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Enhanced governance for Australian charities – a sixth standard

In order to maintain and enhance public trust in the Australian charity sector, the Australian Charities and Not-for-profits Commission Amendment (2021 Measures No. 1) Regulations 2021 (Cth) (the Regulations) came into effect on Thursday 25 February 2021 and creates Governance Standard 6.

Governance Standard 6 requires a registered charity to take reasonable steps to become a participating non-government institution if the charity is, or is likely to be, identified as being involved in the abuse of a person:

  • in an application for redress made under section 19 of the National Redress Scheme for Institutional Child Sexual Abuse Act 2018 (Cth) (Redress Act) or
  • in information given in response to a request from the National Redress Scheme Operator (the Secretary of the Department of Social Services) under section 24 or 25 of the Redress Act.

This could include, for example, a registered charity that was named in the Royal Commission into Institutional Responses to Child Sexual Abuse but may not have been identified so far in a redress application.

Very clearly, Governance Standard 6 strongly encourages effected charities to participate in the Redress Scheme, particularly to ensure survivors of institutional child sexual abuse are appropriately compensated. The six Governance Standards are a core set of minimum standards required to be met in governing your charity – your charity must be able to show it is being run in an accountable and responsible way to maintain registration as a charity.  Although the Australian Charities and Not-for-Profits Commission (ACNC) has strong enforcement powers and can revoke a charities registration, it operates on the basis that it expects most charities will be meeting all of the standards.  It will normally only take enforcement or revocation action in the most serious cases.

How then do you ensure compliance with all Governance Standards?  Having leading practice processes, procedures and most importantly controls in place with a skilled board and executive to manage and govern in line with your charitable purpose.

We can assist you to ensure and maintain compliance with the Governance Standards. Contact us to find out more.
 

Authors
Stephen Howell
Director and Principal Advisor
Stephen is the Principal Advisor for Effective Governance Pty Ltd, a corporate governance consultant, forensic accountant, company director and former company secretary, external auditor, corporate regulator and CFO with a focus on contributing to the...