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Disclosure Regimes for Charities and Not-for-Profit Organisations

Posted By admin On January 1, 2009 @ 12:00 am In Issue 2: Summer 2009 | Comments Disabled

by The Senate Standing Committee on Economics, Senate Printing Unit, Parliament House, Canberra, Australia; December 2008.

Leaders of Australian third sector organisations may soon face new national disclosure regulations with the Australian Senate Standing Committee on Economics’ recent report on models to improve governance, accountability, and transparency in the not-for-profit sector. Historically, Australia’s legislation regulating not-for-profits came about in a piecemeal fashion, with lack of a coordinated approach to transparency and accountability. Charities are not obliged to report in a consistent manner. Instead of an overarching regulator, numerous compliance regulations operate at the State, Territory, and Commonwealth level. This proliferation in regulatory systems forms a significant barrier to transparency and general accountability.

The current disclosure regime was seen to be insufficient because it lacks information of a comparative sort that would allow donors to make informed choices about their giving. The multiplicity of regulation and regulators also causes inconsistency across the sector. To bolster transparency, each organisation must state its purpose, objectives, and measures of success. Accountability measures include clarifying who is responsible — and to whom — as well as stating the consequences if the rules are violated.

It is not yet known when the new disclosure regime will come into being, with a taskforce now required to implement the report’s recommendations. Perhaps sector leadership should take this opportunity to clarify and publicise their own strategies before the government requirements takes hold.

To access the full report see: www.aph.gov [1].au/Senate/committee/economics_ctte/charities_08/report

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