Board structure and accountability: a not-for-profit governance perspective

Not-for-Profit (NFP) entities in Australia play a significant role in the economy in terms of their contribution to GDP and employment. This paper explores the governance mechanisms utilised to monitor and control these entities. As directors on the board are mainly voluntary, the question explored is how much control is exercised and how much monitoring takes place in a sector dominated by time and budgetary constraints? Data was collected from a representation sample of 20 NFP entities and analysed to determine if NFPs demonstrated good corporate governance in relation to accountability, the board of directors, the use of independent directors and dual roles of chairperson and CEO. It is concluded that although some NFP entities are embracing what is termed NFP governance, many more need to voluntarily embrace NFP governance, particularly in the current disastrous economic climate to ensure they continue to exist in the long term