Charities regulator flags top challenges for the sector

Posted on 17 May 2023

By Greg Thom, journalist, Our Community

Woodward Sue Connnecting Up May2023 45
ACNC chief Sue Woodward speaking at the Connecting Up conference. Picture: Hamish Appleby

Reversing the slide in volunteer numbers, reducing red tape, addressing cyber security threats to the sector and grappling with the challenge of effectively managing crypto currency donations are just some of the key priorities being tackled by Australia’s national charities regulator.

Australian Charities and Not-for-profits Commission chief Sue Woodward also said NFPs need to become more agile, exploring new ways to deliver services while effectively managing staff amid widespread economic challenges.

“[There are] cost of living pressures that affect both NFP organisations but also cost of living pressures of those people you might be supporting,” the Commissioner told attendees from across the sector during a keynote speech at the recent Connecting Up conference in Melbourne.

“It’s a double whammy.”

The Commissioner also shared key data from the upcoming 9th edition of the annual Charities Report, due to be released in June.

Among the findings from the ACNC 2021 Annual Information Statement reporting period:

  • An estimated 1.4 per cent of charities ceased operating because of COVID.
  • The number of charities who said they had an online presence was up by 28 percentage points on the same period in 2018, to 61 per cent.
  • Volunteer numbers fell by 596,000 over the same period, putting further pressure on the 50 per cent of charities who operate without paid staff.

The significant decline in volunteer numbers is an issue highlighted previously by Our Community and is currently being addressed via the National Strategy for Volunteering.

“We know there has been a decline in volunteering and [we need to look at] how we get those volunteers back,” said Ms Woodward.

The Commissioner indicated the increasingly sophisticated data analysis being employed at the ACNC is being used to support the work of the Productivity Commission’s inquiry into philanthropy.

Sue Woodward Connecting Up
The Commissioner told the conference that building public trust and confidence is crucial to addressing some of the challenges facing the sector. Picture: Hamish Appleby

The ACNC last year upgraded its Charity Register by adopting Our Community’s social sector classification system, CLASSIE.

The CLASSIE taxonomy, which is also used on Our Community’s SmartyGrants platform, allows people to search by activity type, location, who each charity helps, and registration status.

“We’ve also done some extra work this time on the grantmaking side of the data and we’ve got to draw that out,” said Ms Woodward.

“So there’ll be a bit of a feature on that in the next edition of the Charities Report.”

Reflecting on her first four months in the job, Ms Woodward revealed she was excited to be back at the ACNC after seven years and had returned with an open mind.

“I have met with the 113 staff one-on-one, and I did that because I think the staff are the most important thing in any organisation and I really wanted to get an idea of who is at the ACNC now,” she said.

“I haven’t made any assumptions that just because I worked there seven years ago, I really know what it’s all about.”

Ms Woodward said many of the foundations laid down during her previous tenure, however, had remained in place.

“I feel that the staff are very energised and very excited about having a permanent person now in the role and on board about what we do in our next decade, which is really encouraging for me to know.”

Ms Woodward said she had also been busy speaking to state and territory regulators and Commonwealth agencies and has reached out to international regulators.

“I think apart from introducing myself, I’ve really tried to understand what their priorities are and I’m looking for opportunities where the ACNC can continue to support red tape reduction.”

It was in this context the ACNC welcomed the recent announcement that Australian, state and territory treasurers have agreed to a set of nationally consistent fundraising principles.

“I think that’s a really critical one now and I’m really pleased to be on the inside of the ACNC because I can make sure that we do everything we can to help that actually be implemented.”

Ms Woodward said building public trust and confidence was key to addressing some of the challenges currently facing the sector.

One example of this approach is the $2.9 million allocated in the federal budget over the next four years to boost "transparency and accountability" in the charity sector by enabling increased disclosure of the ACNC's regulatory activities.

“I think if we maintain or improve public trust and confidence then you’ll get the volunteers, you’ll get the donations and that will help you be independent and sustainable,” she said.

Despite the complex environment and issues facing NFPs, Ms Woodward said there were as many opportunities as challenges in the years ahead.

“I’m excited about the opportunity to have the ACNC become a regulator that helps maintain and grow public trust and confidence in Australian charities,” she said.

“A regulator that supports innovation in Australian charities and a world class regulator.

“No doubt, there’s more surprises for me, but I am very committed to that vision and I’ll be looking very much to the continued support and engagement of the sector to achieve it.”

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