Chris Riches:

Hi and welcome to ACNC’s November webinar. It’s our final webinar for 2018. Today we’re going to focus on the topic of running a charity but we’re going to do so with a particular emphasis on the themes of charity efficiency and charity effectiveness, and we’re going to also look at issues like collaboration and mergers. My name’s Chris Riches, I’m from the ACNC’s Education team. With me is my colleague, Matt Crichton. Hi Matt.

Matt Crichton:

Hello Chris. Hello everyone.

Chris:

Before we launch into the webinar the usual quick preliminaries. If you’ve got any troubles with the audio you can try listening through your phone. You can call the number listed in the email you will have received upon signing up, and put in the access code and listen to the webinar that way. You can also ask a question at any time through the webinar by using the tools in the “Go To” webinar panel on your screen. We have our colleague, Heath, ready and waiting to respond to any of the questions that come through. We will try to answer all questions that come through during the webinar but we may not be able to get to every single one. If your question isn’t answered, feel free to send us an email through education@acnc.gov.au and we will respond. We will allow a short amount of time for Q&A at the end of the presentation, so if you wanted to watch and then save your questions until the end, that’s fine. We’re also recording this webinar as always and the recording, as well as the presentation slides, will be published on the ACNC website in the coming days. You don’t have to write down all the website references either as we mention them or as they appear on the screen, we’ll send a follow-up email with a list of useful links and other resources in the coming day or two. And we value your feedback, so if you have any ideas or any suggestions about how we can improve our webinars, especially with our schedule for 2019 being developed, either let us know in the short survey at the end of today’s session or send us an email with your comments.

Now here we go. What are we going to cover today? First up we’re going to revisit the question of who runs a charity. Just a quick point of emphasis so we have context for the remainder of the webinar. Of course we’ll talk quickly about responsible persons, Boards, committees, that sort of stuff. We’ll also look at the ideas of charity efficiency and effectiveness. In some way these might be slightly nebulous terms that are, of course, a little bit different for each individual charity. We’ll then look at the concept of running a charity efficiently and effectively. How do you know if your charity is operating efficiently and effectively, for example? What measures do you have? We’ll also provide some tips towards efficiency and effectiveness for your charity. And finally, we’ll spend a bit of time looking at collaboration and charity mergers, things which can be and in some cases should be considered or at least kept in mind when looking at these types of issues. So let’s hop in starting with some questions your charity should ask.

Matt:

Yes, thanks Chris. As you can see on the screen we’ve got a few questions that you should be asking yourselves if you’re involved in a charity. I’ll just run through each of them fairly quickly. The first one’s an obvious one, so what are the responsible… we’ve got actually on screen here RPs, that means responsible persons. You’ll hear us refer to responsible persons a fair bit throughout the webinar. That’s just a term we use to refer to the charity’s Board or committee members. So when you hear responsible persons or if you might see the letters RP, you can just substitute that in your head for whatever you’ve got in your own charity, whether it be a Board member, Director or a committee member and that means the same thing.

Yeah, so the first question, what’s the responsible persons’ duties to ensure the charity is operating efficiently and effectively? So what should they be doing? What are they doing? And what does the ACNC require that they do? There are some duties that the ACNC requires of responsible persons. The second one, how do we know charity is operating efficiently and effectively? And what are the measures? And this is something that will be different for each charity, it depends on a whole range of variables of course. So this is something that you will have to consider within the context of your own operations but also this is linked to the question of how a charity can tell others about how efficient or effective it is. The third question, can we operate more effectively or efficiently? And if so, how can you do that? The fourth one, what sort of things would happen for your charity to consider thinking about collaborating with another organisation or even merging? That can be a bit complicated but it’s something that a charity Board, the responsible persons of the charity that are doing a good job should keep in the back of their mind, it’s always something that might… the might be some situations where the idea of a collaboration or a merger cops up and it’s worth considering. And if a charity does go down that path, the final question there is, what would it need to do if it’s to collaborate or to merge? What duties does it have and how would it bring about that collaboration or merger practically?

I’ll throw you back to Chris now to have a look at the next part.

Chris:

OK. So we’ll start with the basics. Who runs a charity? As we’ve already suggested, a charity is governed by its RPs, its responsible persons, their Board or committee members generally speaking. The duties of responsible persons is spelled out in ACNC governance standard five. Now there are seven duties, all of them are important but what we’ve done today is highlight three of them that perhaps are of more specific importance to the efficient and effective running of a charity. And there they are.

Duty one is to act with reasonable care and diligence. Obviously that’s something that responsible persons need to do in all their efforts but guiding and monitoring what a charity does, it does cover the ideas of effectiveness and efficiency in an organisation. The second duty, duty two is to act honestly in the best interests of the charity and its purposes. Again, this is an all-encompassing duty but it is in the best interests of the charity to be efficient and effective doing so means it has a better chance of achieving the purposes it works towards. And the third duty listed up there, we’ve skipped a couple and we go duty six, that’s for responsible persons to ensure that a charity’s financial affairs are managed responsibly. This means good processes to prevent problems, policies and procedures that ensure financial matters are overseen properly and in a way that promotes the effectiveness of the charity.

Matt:

OK, so we’ll have a think about what efficiency and effectiveness is and this is where things can get a little bit more difficult. Most of you listening probably have a fair idea of what effectiveness and efficiency are, what they look like. Certainly… well we know it if we see it, and certainly in the universe we can easily recognise inefficiencies and ineffectiveness. So some people would define the two as efficiency being, particularly with money and donations, the wise use of resources and getting the most out of the resources that a charity has. Doesn’t have to be financial but it’s often one of the considerations that people have for efficiencies is the financial aspect.

Effectiveness is, as the screen says, it’s more so about getting the job done. So got on there fulfilling aims, completing projects, running programs, that sort of thing, to achieve the goals of the organisation. In a sense, if you combine the two, efficiency and effectiveness, you get a good idea of the direction that a charity should be getting towards. But as we said at the beginning this is going to look different for different charities and that will depend largely on the sorts of activities, projects and programs that they run.

Measuring it, which we’ll get onto in a moment, is another thing and that’s certainly dependent on what a charity does. And I’ll pass you over to Chris again to just give an overview of how to measure efficiency and effectiveness.

Chris:

Yeah, thank you Matt. It’s something that going to vary. We’ve already mentioned it a couple of times, we’ll mention it again. It’s going to vary. These measures of how an individual charity might measure efficiency or effectiveness will vary depending on the make up of the charity, what you do, its size, all of those sorts of variables. It can… at this stage it becomes a little bit harder to speak about these sorts of things in a general sense, you know charities are different, how say an environmental charity might measure effectiveness and efficiency in its own circumstances will probably vary from how a charity which, say, helps the homeless or those sleeping rough will measure those two things. So you need to be aware that this a… and these concepts are universal but how they apply to you become, it becomes very individual, it becomes very specific to what you do and, I guess, the character of your charity, of your organisation.

Of course there are outside perceptions of what efficiency and effectiveness might be. And what a charity looks at when examining its own efficiency and effectiveness may well differ greatly from those outside perceptions, from the perceptions of the general public and others. When some people look at these things they might look at how a charity raises money and how many people look at fundraising and perhaps even favour fundraising without a lot of outlay from the charity. Some look at these sorts of issues as keeping staff numbers to a minimum, running a charity on the smell of an oily rag pretty much. Doing lots for very little outlay. Operating without any or too many overheads or administration costs. Some of these measures of effectiveness and efficiency are not necessarily the most valid or even the most correct. As we detail on the ACNC website, reasonable admin costs are reasonable. Most charities can’t run merely on that smell of that oily rag, they need to allow for realistic admin costs. Reasonable fundraising costs are also acceptable, as long as they can be justified by the charity. Charities can keep money in reserve, they can make a surplus, all these things are part of prudent financial management. They’re also part of being efficient and effective.

Now you’ll notice as we’ve gone along, or as I’ve chatted the last couple of minutes, the repeated use of the word “reasonable”. What is reasonable in these areas will, again, depend on the charity involved. We’ve got some guidance on a number of these topics, you can see some of those links at the bottom of the slide on your screen there, on admin costs, on fundraising, spending reserve, surpluses, that sort of stuff. We would recommend go and have a look at them, go have a bit of a read through, get a bit of a feel for what we would deem, or what the ACNC would deem to be reasonable, and go from there.

Responsible persons really do have an important role in making sure an organisation is run efficiently and is effective. And so if you are a responsible person for a charity, a committee member, Board member, Director, that sort of thing, there are a few things that you really should consider about your role and think about in the context of the charity’s efficiency and effectiveness, should think about defining the measures that mark your charity’s efficiency and effectiveness. And again we’ve said it a few times this will be different for each charity. And then how to monitor those measures, or modify them as you go along, if need be. When we say define the measures marking the efficiency and effectiveness, it doesn’t necessarily mean that you sit down with a piece of paper and write out a dictionary definition, although, you know, that could help. We more mean that the responsible persons need to be aware of things that indicate that the charity is operating in an efficient and effective way. And of course this is part of the responsible persons duty to comply with ACNC governance standard five, the one we mentioned earlier.

So what we’ll do now is just go through some of the ways that the responsible persons of a charity can track the charity’s efficiency and effectiveness, and provide some examples and some practical tips, I suppose, on where they should be focusing their efforts and how they can improve the efficiency and effectiveness of a charity. Because even the ones that are really well run, there’s still room for improvement.

So the first point mentioned is to keep track of finances, understanding where the charity’s money is going, and also where it’s coming from. And from a responsible persons’ perspective, asking questions about those finances, and especially about anything that looks a little bit inefficient or in need of improvement. Responsible persons, if they need some help understanding financial concepts, they should be able to ask someone. That might be a financial officer, it might be the Treasurer of the organisation, someone who knows their way around a, maybe a profit and loss statement, or some finances. Responsible persons ought to also examine the finances to ensure that charity spending is justified and appropriate. For example, admin cost spending is reasonable and that it contributes to charity effectiveness or that money that is being spent to raise funds is, again, reasonable or necessary. And there’s always, again, the option of not spending money on raising money. So that’s, again, something that should be in the back of your mind all the time and floated over the committee or Board table when appropriate.

Second point is to be across charity activities and work. Responsible persons need to know what their charity is doing. I mean that sounds pretty obvious but they also need to be knowledgeable enough about it to be able to, I guess, discern whether the work that is being done is being done efficiently, whether it’s effective, whether it’s having the desired effect, and whether questions should be getting asked and where necessary improvements are made. They need to be informed and active in discussions and deliberations. We’ve said this in a number of webinars throughout this year that responsible persons can’t just sit there and nod their heads, they have to be informed, they have to be active, they have to know what’s going on around them and be able to raise concerns, ask questions, and those sorts of things, to ensure that they’re very involved in the running of the charity. It’s a good idea also to talk to people inside and outside the charity. It provides good perspective on your organisation and its work. Responsible persons should never get into a situation where they are isolated from their charity’s people or from any worthwhile perspectives coming in from outside the charity. They could look, you know, could something be done better or more efficiently? Are there perspectives they haven’t thought about when it comes to their work? Are there perspectives from those on the ground, the volunteers, staff members, helpers, supporters, that sort of thing, or those with knowledge in specific areas? As a responsible person are you chatting with other responsible persons, Board or committee members? How is that communication across the Board table? These are the sorts of questions you should ask.

So that’s three. We’ve got a couple more on the next slide and I’ll let Matt talk about those two.

Matt:

Yeah, just a couple more. But that’s a really important point, it’s one worth reiterating that if you’re on a Board, yeah don’t let yourself get disconnected from the work of the charity on the ground. And it might be very different things for very different charities but the Board should be really across all the work that the charity does and should know it at that sort of basic fundamental, you know, frontline level. And it will inform… it will allow the Board to make more informed decisions, and better decisions really if they know what the charity doing on a daily basis.

We did mention finances. One of the things that an organisation, responsible persons for a charity should do is check the figures. And that comes with checking projects and programs, and ask questions. So if you are engaged with that frontline level, as we’ve described, you should be able to ask questions of the people there and really make sure that you’ve got a clear understanding of what’s going on.

Keep up with all the financial reports and know where the money’s being spent, what sort of tenders and contracts are out there and if you are getting, I suppose, the best bang for your buck. There might be some people, organisations, companies, or whatever that you use, subcontractors, that might be doing a better job for less money

Chris:

But never let, never sort of just sit back and if you’ve got a contract or if you’ve got to tender an agreement with someone to provide a service or something like that, never sit back, never say ‘oh well this is good enough, it’ll be good enough forever’ because things change and be actively looking when required and be aware that things do change and you might by looking around get a better deal somewhere, or you might find an alternate source of funding or provision of services from somewhere as well.

Matt:

Exactly. And know what’s coming down the pipeline. Although you can’t know everything that’s going to happen in the future, all diligent responsible persons will be aware of sort of trends and issues and external forces that may have an effect on a charity’s work and its capacity to get the job done. So for example are there other funding sources available that you’ve heard of through your contacts or other people? Are there new grants program available from certain organisations or even government? And are there new ways of doing things? Have you come across a new piece of technology or a new approach or something that you learned at a conference somewhere that could be applied to the way your charity does things? And it’s important to be across these things and think about how they can be applied to your organisation, the work it does.

Chris:

Now before we kick off a webinar anyone who wishes to register and attend often has the opportunity to throw a question our way prior to it. And one that we received quite a lot of queries about, so much so that we’ve ended up putting in a couple of extra slides in this presentation, is about meetings and about the efficiency and effectiveness of meetings. Now we’ve touched on a couple of issues just in the last few minutes and this is an important consideration, an important measure of efficiency and effectiveness. Responsible persons should be thinking about and discussing how their meetings are going, how efficient, how effective they are. We’ve all sat in on meetings that seem to meander along, don’t go anywhere, no decisions are made, or if they are made they seem to take a very, very long time. Poor meeting practices can be among the most obvious signs of inefficiency. Meetings that don’t achieve anything also clearly impact on a charity’s effectiveness. We’ve got a few pretty simple tips to address the issue.

First thing, first up is to ensure your meeting is staged in accordance with your charity’s rules. That’s the first basic point. Before the meeting ensure you’ve got a proper well-structured agenda and get it out to attendees beforehand so they know what’s coming up, they’re not going to be blindsided by anything and they’re prepared to discuss and engage. Invite the right people to the meeting, especially if you’re talking specialist, I guess, topics or you might be getting a report on a project or something like that, get the Project Manager in, get the Treasurer or Finance Officer in. Ensure you have a quorum so that the decisions you make are actually valid. Now during the meeting, start on time. Don’t dilly-dally. Stick to the agenda that you’ve got prepared. Try not to get side-tracked. Discuss the issues properly but don’t hinder the meeting effectiveness by wandering off on tangents all the time. Ensure you’ve got a Chairperson to oversee the meeting, have them in place and ready to go. Have someone whose job it is to take notes during the meeting, that includes recording the decisions that are made, discussions, movers and seconders of motions, that sort of thing. What this does, it displays transparency in decision making and improves efficiency later on when you’re preparing the minutes. And finally, again, ensure you follow the rules that you have in place for meetings.

Matt:

Yeah, just make sure you set yourself in the beginning too so that way you can enforce the rules halfway through the meeting and it’s not going to come across as if someone’s being singled out or targeted because you didn’t want to hear what they in particular had to say. So if you say from the outset, ‘look, we’re going to keep on time, we’re only going to discuss what’s on the agenda, other things can be discussed at a later date or another time’, you can just remind people of that as you sense the meeting going off on a tangent, or people are, let’s say, hijacking it for their own agenda. You can point to the rules that you outlaid at the beginning and say, ‘we’re going to stick to these’ and that way it’s a way of enforcing the good behaviour that you want to see in the attendees from the outset. And just at the end of a meeting, as you can see on the screen, write up the minutes while it’s still fresh in peoples’ minds and get them distributed pretty quickly, and make sure you’ve noted the action items and what people must do to get them done. We’ve got a few resources that will be useful for you and we will include those in the follow-up email that follows this webinar so you don’t need to worry about writing them down now, we’ll include those as links in the email for you.

Now we will have a talk about collaboration. This is one of those tricky things and I think there’s a few things that we can, some tips and some advice that we can offer.

Chris:

Inevitably when we’re talking about things like efficiency and effectiveness your thoughts end up maybe turning to working with other organisations. Collaboration is an alternative. Collaboration in this context is where a charity may simply just choose to work with another organisation. Now we can often call these arrangements partnerships. They can involve two or more charities or groups that range across charity, community, corporate or government sectors. Efficiency and effectiveness are of course sort of at the heart of partnerships or collaborations by working together, by pooling resources, that’s not just money, it’s knowledge, it’s people, goods, services, that sort of thing. Partners aim to better use what they have or even generate more of what they have, and in doing so provide further benefits to the community or to the target group than what would occur if they work separately. Partnerships and collaborations can not only see existing resources combined for better effect but they can also see new value created, and in fact they probably should see new value created.

OK the next one, as we can see on the screen, triggering the collaboration discussion which basically means think about what you need, what you might need to collaborate, what situations might arise that will sort of force your hand, or at least force you to talk about collaborating. There might be something that you… might be a new activity, a new program or something that you want to do but just don’t have the ability to do yourselves, whether that’s the technical knowledge know-how or if it’s simply resources, not enough people, not enough money to do so. It could be that another organisation you know of could complement the work that you do already and working together will produce real benefits. It could be that you have a pre-existing relationship with another organisation for whatever purpose and you see that you could use that as the start of a collaboration. Maybe they do something that you don’t do and similarly you do something they don’t do and then it gives rise to a new program or activity.

Whatever it is, whatever sparks the discussion about collaboration, the responsible persons, again, are the important drivers of this and they’re the ones making decisions on behalf of a charity at that executive level, that decision making level. So they’re the ones that should be aware of the collaboration potential and should keep it in their arsenal, I suppose, when it comes to ensuring that their charity is as efficient and effective as it can be. And that may be that it may be a regular discussion on the Board meeting agenda.

We have a good guide on our website which again we’ll send a link to. You can see it on the screen there at acnc.gov.au/partnerships. This guide is mostly about partnerships between charities and corporates or businesses but much of the wisdom contained within it is applicable for charities working with other charities or other not-for-profits as well. So it’s worth having a look. We’ll send that link in the follow-up email as well so you’ll be able to get that without having to drop down on URL now.

Now one last topic to cover today, merging. Merging is often a bit of a tough one to talk about. But like the idea of collaboration and of partnerships there are often links between merging and the themes of effectiveness and efficiency. Merging can come up when charities who are looking at, they might realise they are doing some similar work with another charity, especially if they’re doing similar work in the same area, be it the same geographic area, the same topic area, focus area, that sort of thing. Merging might bring with it some efficiencies, it may also expand the effectiveness of a charity’s work. But at the same time it’s not the right answer for every charity.

Now who has responsibility to decide on merging? Well the ACNC doesn’t. Again, this responsibility rests with the charity’s responsible persons.

Matt:

Yeah, there are no requirements or conditions that dictate that a charity must merge or consider merging. And certainly the ACNC, the role of the ACNC isn’t step in and force a merger upon an organisation. And just because there are a few charities doing similar things in the same area, it doesn’t necessarily mean that any of them are compelled to merge or must consider a merging. Though having said that, it may be a prudent discussion to have if a charity is struggling. One of the charities in a similar area doing similar things is struggling or maybe it’s not as efficient as it could be, or not as efficient as the others doing the same work in the same area, it may be that a merger is just a sensible discussion to have. It’s something that you shouldn’t necessarily shy away from. Of course it means that an organisation is effectively closing down in the sense that it’s no longer the thing that it used to be but that might just be one step in its evolution and it becomes a new and better organisation, if a merger was the right thing for the charity. And, again, that all comes down to the decision of the responsible persons that are responsible for operating and running the charity.

Chris:

Now what’s involved in merging? Well in order to merge the charities will need to agree to merge. So that’s a pretty obvious first step. The way a charity does may be affected by its governing documents, and any relevant legislation, incorporating legislation, that sort of thing. A charity could, for example, need to have its members pass a special resolution at a meeting, a general meeting, in order to merge. If that occurs, charities will need to agree with each other on how the new charity, new legal entity, new organisation will operate. This includes things as, including, you know, whether they’re going to move into one office, how to manage their finances, the effects on employees, those sorts of things. Then once all that sort of have been discussed and figured out you can go through the process of merging. It can be complicated, it can be involved. It’s not something to be taken lightly. It might be a good idea to really take some time to work through the options to consult widely amongst responsible persons and, look, most likely you’ll probably have to consult through charity staff, membership, all those sorts of things as well. Got to really treat the decision with the gravity, with the seriousness that it deserves.

Matt:

Having decided to merge though, taking into consideration all the things that you need to, there will be a few things that you need to do for the charity to complete this one. There’s a few dot points here that give you an overview, a sense of what’s involved but of course this list will expand based on, you know, your organisation’s activities and structure. So take this as a starting point, as a guide and work from there. But you’ll need to comply with all the relevant legislation. So think about what laws govern the structure and the set-up of your organisation. Submit any forms to ensure that you’ve met your legal obligations to regulators or even to your employees. Stick to what’s set out in the governing documents, they often contain some clauses that govern the way in which an organisation needs to wind up or merge with another. Of course tell people that the charity is merging. You do… even if a charity is at the point where they think they need to merge, whether it’s lack of resources or lack of efficiency, that sort of thing, it still has supporters and it still has people that will be disappointed so it’s important to tell them that the charity’s merging and it’s sort of just taking on a new guise, I suppose, it’s not finishing, it’s taking a next step. Follow up on any other requirements you have, so it might be changes to the ABN, there might some tax concessions are affected by the way in which you’ve merged and the organisation with which you’ve merged. And even to the ACNC, notify the ACNC of changes. We’ve got some guidance at that web address there, acnc.gov.au/merge too.

OK a few things to just sort of wrap up the main part of the webinar, we’ve got some important points to remember. We’ve got six in total. Chris will take you through the first couple.

Chris:

Now responsible persons play the key role in ensuring that the charity operates efficiently and effectively. This is not only in their duties to comply with governance standard five, which we’ve mentioned previously, but also in making decisions on efficient and effective charity behaviour. Now the second point to remember is generally if your charity strives to be efficient and effective, it aims to get the job done and to do so in a way which makes the best use of the resources it has.

Matt:

Yes, but of course how each charity measures efficiency and effectiveness will differ, and it will differ according to a whole range of factors, that being the aims of the organisation, what it does, its priorities, the nature of the work, its location, all of these things. And public perceptions of charity efficiency and effectiveness may vary depending on how your organisation measures them or defines them. The fourth point to remember is that responsible persons have the job to set out the charity’s course and direction. So they should take the time and make sure they’ve defined the measures that mark a charity’s efficiency, and monitor those. And even less so as an external document, whilst this can help and it would be a great step in the direction of transparency to offer that up to all supporters, donors and even the general public as a way of showing what you value and how you mark efficiency and measure it, but particularly for internal work processes and decisions. If you’ve got that document or if you’ve got that, whatever it may be, clearly understood by all the people involved in the charity and they’re working towards the same goal, with the same understanding of the mark of efficiency and how to monitor it, then that can be much easier and lead to much better outcomes.

Chris:

The fifth point to remember is that the decision to collaborate or work with another organisation, again it rests with the charity’s responsible persons. They should be aware of what collaborations may offer. And that might include the potential for improved efficiency and effectiveness. Sixth point is that, of course, merging is another option for charities to discuss. But it is a rather more permanent option. If a charity makes the decision to merge, there are plenty of I’s to dot and T’s to cross, it is not a decision to make lightly.

Matt:

No, that’s for sure. Yeah, it’s an important one to consider and to consider seriously but just know that once you’ve made that decision it’s very… I was going to say impossible to undo but maybe not, very close to it and very good time to…

Chris:

A lot harder to undo I think.

Matt:

Yes. Alright, we’ve had a few questions pop up as we’ve gone along throughout the webinar. If you’ve been waiting for the chance to answer questions to our… now’s the point to send them through, we’ll see if we can get to as many as we can. One that did pop up that we thought we would share, see if anyone can get something out of it is asking about collaborations and more specifically it’s asking about, how do we know if the collaboration that an organisation is part of is operating efficiently and effectively? OK, so that’s a pretty good question. So it’s one thing to know that your own organisation may have some inefficiencies that you want to cover but once you decide to get into a collaboration to improve things, how do you know then that collaboration with the other organisation is working efficiently and effectively? Chris, I’ll let you take this one. What can we say to this?

Chris:

Regular reviews would probably, and gee that sounds boring but it’s something that needs to be done. If you’re working with another organisation you can’t be working in a silo. You’ve got to set aside some time with your partner organisation or people from it to have a chat, to sit down to review how the collaboration or how the partnership is travelling along. There might be times where you might need to review the aims of the arrangement. The divvying up of the work and responsibilities that go with it just… and also just a general sort of look to make sure it’s as efficient and as effective as it could be. There are some things that perhaps you should sort of think about I guess. Whether the work within the partnership or the collaboration is divided up fairly and reasonably, not too much falling on one side or the other, you know the amount of work that you do is good for the amount of resources you’re putting in, the size of your organisations and that sort of stuff. Whether the collaboration itself has still got support, wide support from within both organisations. Does the collaboration still do things in an efficient way? Is it still the most efficient way to achieve what your aims are, what you’re trying to do? If it isn’t, then maybe it’s time to reshape the collaboration, seek out alternatives, that sort of thing. Again, is it making the best use of the resources that it draws on? Is there flexibility in the partnership? Is there an ability or is there a willingness to change to be flexible, to make alterations to change the course of things if required?

And again we mentioned earlier the world doesn’t stand still so if there are things that are happening, if there’s some ideas, if there’s some approaches that could help efficiency in the partnership, consider them. Is it something that we look at? Learn from things also that haven’t work, recognise things that have and through all this communication is the key. You’ve got to be talking. Again, you can’t be in a silo so keep talking.

Matt:

OK, I’ve had a couple… actually just before we do get onto another one, that’s an important thing to keep in mind at the beginning of the collaboration. So think about things maybe not continuing in the way that you would like them to way down in the future so that when you set up the conditions on which you’ve collaborated with another organisation there is flexibility within the arrangement, within the agreement to change things or to review things and that sort of thing. So it’s important to… this is not necessarily being negative or foreshadowing bad things or things going wrong, it’s just having the foresight to know that you will want to adjust or tinker with things later on. So make sure you’ve got that leeway in the agreement at the beginning which will make it so much easier later on.

Yeah. We had a question about mergers, and just in particular if there is a way that a charity has to report a merger to the ACNC. And the short answer is no, there isn’t a particular way to report a merger and an organisation doesn’t have to report a merger. But they do have to report or notify of particular changes to their charity that will inevitably come through a merger. So it depends on what happens with the merger. If effectively one organisation is, let’s say, taken over by the other in that one organisation in effect ceases to exist, its ABN is no longer registered and it sort of fits under the existing structure and ABN of another organisation, well in that sense it might be that the organisation notifies the ACNC that it’s no longer operating and it will have its registration cancelled. It might be that both organisations are effectively cancelled in their current state and they form a new organisation, in which case both would have to notify that the organisations no longer have ABNs registered and that sort of thing, and then you would have to register the new organisation that comes up in its place. So it depends on the context of the merger itself, and depends on what details have changed. But no doubt the process of any merger will result in changes to a charity that do require some notification to the ACNC. The best thing to do is have a look on our website to see what are the required notifications, and if any of those change as a result of the merger then that’s the thing that you will need to get in touch with the ACNC about.

Chris:

I think that merge guide that we chucked up on the screen earlier too, I think that’s got a decent run down of some of the things you may need to notify us about as well. So have a look at that one too definitely. I think that’s about…

Matt:

Oh we’ve got another one…

Chris:

We’ve got one more have we?

Matt:

There’s a couple more.

Chris:

Cool.

Matt:

There’s actually an interesting question about training to become an effective Board member. That’s a good question. It’s one we get a fair bit on a range of topics if… what kind of training can individuals do to become more effective as a responsible person? I suppose one thing we would say is participation in things like this, this is not just plug our own webinar program but it’s really the reason we run them, to help people become effective responsible persons on charity boards and to be able to, I suppose, improve the aggregate running of charities across Australia. So paying attention to these sorts of things.

There are other organisations out there that run similar webinars, seminars, these sorts of things, that are often free, sometimes they might take a token fee, of course it goes without saying, it’s a bit redundant to say that some are more expensive than others, but have a look and see which is most effective for your organisation. And just, I know Chris has got something to add on this point but I would just jump in and say although we are sort of socially conditioned to expect charities to not spend anything on admin costs and that sort of thing, this is the sort of thing that it’s probably worth considering, of course excessive spending is not allowed really and it’s something that the ACNC could potentially look at, but reasonable spending on admin costs may involve reasonable spending on training modules or courses for your responsible persons to become better at the roles that they have.

And again, as we’ve said throughout this webinar, this will look different for all charities. Some have much bigger budgets than others, some have bigger Boards, smaller Boards, some have existing expertise on a Board, you might have three lawyers and three accountants already on your Board so you’re sort of covered in the legal and financial areas, so you probably wouldn’t need to send them on a sort of cheap course to understand financial statements. But for another organisation it may be something that you want to consider.

Chris:

One other thing to think about too away from just, I guess, a formal training environment is if you have new Board members jumping in, helping out, make a point of setting aside some time, get some existing responsible persons and have them do a little bit of shadowing, job shadowing or position shadowing, where you know, say, if there’s an outgoing responsible person on your Board who has responsibility for certain specific areas, that that person who’s going to come in and take their place has the opportunity to see them in action, has the opportunity to learn from them whilst they’re still there, whilst they’re still part of the Board. There’s nothing worse than the loss of institutional knowledge because your Board, your organisation grinds to a halt as other people try and get up to speed, and then if there’s another changeover, grind to a halt again, people have to get up to speed again. Keep things rolling by ensuring that those who do come on board have the opportunity to learn from those who are already there, be it through, say, job shadowing, maybe some mentoring. Things like welcome kits, induction packs, all those things that we’ve talked about previously as well, this is where they are very, very valuable. And, again, coming back to efficiency and effectiveness, they are cornerstones to allow an organisation to continue to roll forward and not stop. So they’re the sorts of very, let’s say, easier things that you can do, that responsible persons can do to keep the organisation rolling.

Matt:

And just on some of those just external courses too, just to make a bit of a search, a little bit easier than going to Google and saying, how do I become an effective RP, responsible person? There are some resources that we often will tell people about. So our community has some great resources online. I think not-for-profit law is another one that you could check out. Australian Institute of Company Directors has some free resources as well that you can have a look at. They’ve got lots of information about governance, general governance of course with not-for-profit specific governance too. And even the Australian Centre for Philanthropy and Non-Profit Studies at QUT is a source of some good information too. So we’ll include some of these links in the follow up email, but that I suppose is a handy set to get you started if you needed a bit of a help to start your search, and of course you’re cookies and internet traffic history will then take care of the rest I suppose.

Chris:

Alright, I think that brings us to the end of today’s webinar. We’re getting close’ish to one o’clock now. Thank you very much for your attendance today. We will hang around just a touch longer just in case there are some late questions coming in, feel free to send them through. If we don’t get around to you, zoom an email through to us, education@acnc.gov.au and we’ll endeavour to get back to you as soon as we can. Again, we’ll just mention we’re looking for ways to improve our webinars, our education products here at the ACNC. We would love it if you took the time to let us know what you thought of today’s session by completing the survey that’ll pop up after we’re done here. It’ll literally take you a couple of minutes. If you’ve got any additional comments or questions about the webinar, you can get in touch with us, again, via the Education email address we’ve mentioned previously. Beyond that, that’s it for us for today and that’s it for us for webinars this year. We want to thank you all for attending today and to those who have attended throughout 2018, thank you very much, we’ll be back next year with a whole heap of new webinars. So please keep an eye on the website, we will get that information up and feel free to register and jump in and take part. Thank you to Heath for typing away madly in the background. Thank you to Matt for being here as well.

Matt:

Thanks.

Chris:

And thanks to everyone for joining us.

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