Board remuneration considerations for NFPs

The Chartered Accountants Australia and New Zealand (CA ANZ) has recently released an insightful paper covering key factors to be considered by not-for-profit organisations in determining whether those charged with governance should be remunerated.

The paper includes a checklist highlighting aspects to be considered when contemplating remunerating Boards including an organisation’s constitution, funding constraints, potential tax implications and other key agreements. An in depth pros vs cons analysis for remunerating Boards is also outlined. The case for remunerating Boards is centred around the need to attract a skilled and diverse group of individuals and provide recognition for their time and effort. The argument for not remunerating those charged with governance is focused around the fact that is reduces the potential liability risks associated with being a director and it may also be perceived as being against the spirit of the sector, based on a belief that all of a NFP’s available resources should go directly to furthering the purpose of the organisation.

A copy of the insight paper can be found here.

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