The term “governance” can be used to convey two slightly different concepts.
In the first place, it can mean the process of decision-making in an organisation, taking into account its structure and rules – in other words, the way in which the organisation is governed by its board or committee. Governance in this sense is an internal matter for the organisation. The term is also used in another sense, to refer to the external body of legal and regulatory obligations with which organisations must comply in going about their business – their governance duties. When the organisation is a company, these are their corporate governance obligations
The term “non-profit” simply means any organisation that reinvests profit back into the organisation, rather than distributing it to its members. Non-profits come in many shapes and sizes. It is estimated that there are some 30,000 such organisations in Ireland. The span of activity of these bodies is truly impressive, and diverse. The sector encompasses traditional charities, sports bodies, arts organisations, apartment management companies, educational institutes, professional organisations, trades union, governmental agencies, statutory bodies, and no doubt others.
The structure of a non-profit affects its governance practices and legal duties. Some are unincorporated associations, with or without a written constitution. Some are trusts, or incorporate a trust. The majority of non-profits are however incorporated as companies limited by guarantee. This has become the structural standard for non-profits. Little has been written about this type of company. It has a particular internal configuration that does not suit every organisation. It needs to be understood and adapted to the needs of the organisation.
Linda Scales advises non-profits on their structures, tailoring or redrafting their constitutional documents when this is needed, and helping the organisation to understand the interplay between structure and performance. She advises on regulatory questions, advising on ways in which the governing board can avoid problems of compliance, and contain personal responsibility. As a veteran of many years on non-profit boards, she can draw on personal experience to spot and help diffuse problems which hold back the performance of the board. She facilitates governance reviews for organisations, tailoring each one to the needs of the organisation, and guides the preparation of handbooks, codes of practices and other useful supporting documents.
Additional Reading:
See the following blog posts: