Who regulates the governance of Not-for-Profits in Australia?
Published: December 12, 2016
Read Time: 5 minutes
The administration of NFPs is a complex business in Australia. Whether an organisation is regulated by a state-based or Commonwealth body will largely depend on its legal structure, but certain organisations may face additional regulation based on their activities, for example if they are a charity or part of a highly regulated sector such as aged care. Consequently, dozens of statutory bodies are involved in the regulation of the governance of NFPs across the country and it can be difficult to ensure your board is meeting all of its necessary requirements and importantly to know where to seek advice if something goes wrong.
At Better Boards we receive many enquiries regarding internal disputes or concerns of misconduct at the board level. Often these enquirers are unsure of who their organisation should turn to for advice, to resolve issues, or in more serious cases to report an incident. These types of issues are many and varied and often the best starting point is to check in with your organisation’s regulator regarding how the issue should be properly resolved for your type of organisation. In some cases the regulator will have a process for resolving that type of issue and in others they may refer you to another government body, such as the police. Please note, charities have additional rules beyond those of other NFPs, information about charities and their regulatory body, the Australian Charities and Not-for-profits Commission, appear lower down in this fact sheet.
Governance of Not-for-Profits in Australia: Frequently Asked Questions
Dozens of statutory bodies are involved in the regulation of the governance of Not-for-Profits across the country and it can be difficult to ensure your board is meeting all of its necessary requirements and importantly to know where to seek advice if something goes wrong.
Companies limited by guarantee
Companies limited by guarantee are incorporated under the Corporations Act 2001 (Cth) and federally regulated by and report to Australian Securities and Investments Commission (ASIC). More information can be found in our company limited by guarantee fact sheet.
ASIC provides clear guidance on their powers and processes for dealing with complaints and disputes relating to the misconduct of a company or company director (including companies limited by guarantee).
ASIC’s How to complain page provides a starting point for determining what type of issue you are dealing with.
Incorporated Associations are regulated at the State level and the regulatory body differs in each State, as do the processes for reporting misconduct and resolving disputes. In most States, such as Victoria, the State regulator will also be the relevant regulator for issues relating to fundraising, however, in others such as the Northern Territory, fundraising will be regulated by a separate body. More information can be found in our incorporated association fact sheet.
Below is a list of the “starting point” pages for resolving disputes relating to Incorporated Association in each State:
Organisation formed by Royal Charter or by Special Act of Parliament
See our fact sheet for more information on this type of organisation. These organisations must comply with the specific act or charter relating to their establishment, often called their constituting documents. If the organisation is not otherwise a charity, complex questions or complaints relating to an organisation formed by royal charter or special Act of Parliament are best directed to the relevant Attorney General in your State if it is incorporated under a state Act or Commonwealth Attorney General if it is incorporated under a Commonwealth.
Indigenous Corporations are overseen by the Office of the Registrar of Indigenous Corporations (ORIC) an independent statutory officer holder appointed by the Minister for Indigenous Affairs under the Corporations (Aboriginal and Torres Strait Islander) Act 2006. More information about Indigenous Corportations can be found in our indigenous corporation fact sheet. Most but not all Indigenous Corporations are not-for-profit organisations. Complaints regarding misconduct can be made through ORIC – Making a Complaint.
State regulators may also redirect complaints to a specific industry regulator, especially where they relate to the provision of a service. These may include.
Since 2012 charities have been administered by the Australian Charities and Not-for-profits Commission (ACNC). The ACNC is responsible for the registration of charities and requires that charities maintain various ongoing obligations as well as meet reporting requirements. The ACNC have the power to cancel the registration of a charity where some of these obligations are not met, or to pass on a complaint to another government regulator. The ACNC’s powers to investigate and avenues for addressing complaints are outlined on their website and includes multiple methods of submitting a complaint.
This fact sheet is intended as a simple overview. Non-profit law is incredibly complex and there are many components, allowances, restrictions, exceptions and important qualifications that are not described above. Dedicated legal advice should be sought from a legal practitioner before taking action.
Better Boards connects the leaders of Australasian non-profit organisations to the knowledge and networks necessary to grow and develop their leadership skills and build a strong governance framework for their organisation.