How nonprofit boards monitor, judge and influence organisational performance

The law and popular opinion expect boards of directors will actively monitor their organisations. Further, public opinion is that boards should have a positive impact on organisational performance. However, the processes of board monitoring and judgment are poorly understood, and board influence on organisational performance needs to be better understood. This thesis responds to the repeated calls to open the ‘black box’ linking board practices and organisational performance by investigating the processual behaviours of boards. The work of four boards1 of micro and small-sized nonprofit organisations were studied for periods of at least one year, using a processual research approach, drawing on observations of board meetings, interviews with directors, and the documents of the boards. The research shows that director turnover, the difficulty recruiting and engaging directors, and the administration of reporting, had strong impacts upon board monitoring, judging and/or influence. In addition, board monitoring of organisational performance was adversely affected by directors’ limited awareness of their legal responsibilities and directors’ limited financial literacy. Directors on average found all sources of information about their organisation’s work useful. Board judgments about the financial aspects of organisational performance were regulated by the routines of financial reporting. However, there were no comparable routines facilitating judgments about non-financial performance, and such judgments tended to be limited to specific aspects of performance and were ad hoc, largely in response to new information or the repackaging of existing information in a new form. The thesis argues that Weick’s theory of sensemaking offers insight into the way boards went about the task of understanding organisational performance. Board influence on organisational performance was demonstrated in the areas of: compliance; instrumental influence through service and through discussion and decision-making; and by symbolic, legitimating and protective means. The degree of instrumental influence achieved by boards depended on director competency, access to networks of influence, and understandings of board roles, and by the agency demonstrated by directors. The thesis concludes that there is a crowding out effect whereby CEO competence and capability limits board influence. The thesis also suggests that there is a second ‘agency problem’, a problem of director volition. The research potentially has profound implications for the work of nonprofit boards. Rather than purporting to establish a general theory of board governance, the thesis embraces calls to build situation-specific mini-theories about board behaviour.

Nonprofit organizational behaviour : sociological and psychological approaches

The study of organizations goes to the roots of social science. Abundant theory provides the basis for explanations of diverse aspects of organizational structure and process. As a subset of organizations, nonprofit organizations can be studied with many of the same theoretical approaches used for studying other organizations. Still, nonprofit organizations have some special characteristics, such as a multiplicity of stakeholders and the use of volunteers; some theories of organizations can therefore be expected to be especially useful for studying nonprofit organizations and some other theories not to be very useful. In general, our approach is to apply relevant organizational theory to nonprofit organizations. As such, this essay is not a typical review of literature about nonprofit organizations. Instead, the purpose is to equip the reader with conceptual and theoretical tools for understanding nonprofits as organizations.

Nonprofit organizational and work unit identification and the occupational stress process

Research investigating the transactional approach to the work stressor-employee adjustment relationship has described many negative main effects between perceived stressors in the workplace and employee outcomes. A considerable amount of literature, theoretical and empirical, also describes potential moderators of this relationship. Organizational identification has been established as a significant predictor of employee job-related attitudes. To date, research has neglected investigation of the potential moderating effect of organizational identification in the work stressor-employee adjustment relationship. On the basis of identity, subjective fit and sense of belonging literature it was predicted that higher perceptions of identification at multiple levels of the organization would mitigate the negative effect of work stressors on employee adjustment. It was expected, further, that more proximal, lower order identifications would be more prevalent and potent as buffers of stressors on strain. Predictions were tested with an employee sample from five organizations (N = 267). Hierarchical moderated multiple regression analyses revealed some support for the stress-buffering effects of identification in the prediction of job satisfaction and organizational commitment, particularly for more proximal (i.e., work unit) identification. These positive stress-buffering effects, however, were present for low identifiers in some situations. The present study represents an extension of the application of organizational identity theory by identifying the effects of organizational and workgroup identification on employee outcomes in the nonprofit context. Our findings will contribute to a better understanding of the dynamics in nonprofit organizations and therefore contribute to the development of strategy and interventions to deal with identity-based issues in nonprofits.

Implementing an employee performance management system in a nonprofit organization

Nonprofit organizations are not exempt from the imperatives of employee attraction, retention, and motivation. As competition for staff, donors, and funding increases, the need to manage employee performance will continue to be a critical human resource management issue. This article outlines a study of the introduction of a performance management system in an Australian nonprofit organization and analyzes its design and implementation. It explores how performance management can be introduced and used effectively within a nonprofit environment to benefit staff and the organization. However, the use of performance management is not without its challenges, and the research also identified initial employee resistance and a resulting initial spike in labor turnover. However, findings indicate that if nonprofit organizations are willing to undertake consultation with staff and ensure that the organization's specific context, values, and mission are reflected in the performance management system, it can be a useful tool for managers and a direct benefit to employees.

The Australian Nonprofit Sector Legal Almanac 2010, ACPNS Working Paper 53

This is the third year that we have summarised annual developments in the law for nonprofit staff, boards and volunteers. We were encouraged by the interest shown in last year’s publication and the use made of the digital copy on our web site, so here is the almanac for the Jan 2010–Dec 2010 period. We are delighted that the Australian Charity Law Association and PilchConnect (Victoria) have again agreed to contribute and promote the publication as well. These two organisations are beginning to fill the void of professional legal development and assistance to small nonprofit organisations that has characterised Australia for too many years. The first conference of the Australian Charity Law Association in Sydney was a significant event and one of the addresses is included in the Almanac. Other materials from the conference can be accessed at the Centre’s website.

Innovation, interaction, and inclusion : heritage luxury brands in collusion with the consumer

Many luxury heritage brands operate on the misconception that heritage is interchangeable with history rather than representative of the emotional response they originally developed in their customer. This idea of heritage as static history inhibits innovation, prevents dynamic renewal and impedes their ability to redefine, strengthen and position their brand in current and emerging marketplaces. This paper examines a number of heritage luxury brands that have successfully identified the original emotional responses they developed in their customers and, through innovative approaches in design, marketing, branding and distribution evoke these responses in contemporary consumers. Using heritage and innovation hand-in-hand, these brands have continued to grow and develop a vision of heritage that incorporates both historical and contemporary ideas to meet emerging customer needs. While what constitutes a ‘luxury’ item is constantly challenged in this era of accessible luxury products, up-scaling and aspirational spending, this paper sees consumers’ emotional needs as the key element in defining the concept of luxury. These emotional qualities consistently remain relevant due to their ability to enhance a positive sense of identity for the brand user. Luxury is about the ‘experience’ not just the product providing the consumer with a sense of enhanced status or identity through invoked feelings of exclusivity, authenticity, quality, uniqueness and culture. This paper will analyse luxury heritage brands that have successfully combined these emotional values with those of their ‘heritage’ to create an aura of authenticity and nostalgia that appeals to contemporary consumers. Like luxury, the line where clothing becomes fashion is blurred in the contemporary fashion industry; however, consumer emotion again plays an important role. For example, clothing becomes ‘fashion’ for consumers when it affects their self perception rather than fulfilling basic functions of shelter and protection. Successful luxury heritage brands can enhance consumers’ sense of self by involving them in the ‘experience’ and ‘personality’ of the brand so they see it as a reflection of their own exclusiveness, authentic uniqueness, belonging and cultural value. Innovation is a valuable tool for heritage luxury brands to successfully generate these desired emotional responses and meet the evolving needs of contemporary consumers. While traditionally fashion has been a monologue from brand to consumer, new technology has given consumers a voice to engage brands in a conversation to express their evolving needs, ideas and feedback. As a result, in this consumer-empowered era of information sharing, this paper defines innovation as the ability of heritage luxury brands to develop new design and branding strategies in response to this consumer feedback while retaining the emotional core values of their heritage. This paper analyses how luxury heritage brands can effectively position themselves in the contemporary marketplace by separating heritage from history to incorporate innovative strategies that will appeal to consumer needs of today and tomorrow.

Innovation, interaction, and inclusion : heritage luxury brands in collusion with the consumer

Many luxury heritage brands operate on the misconception that heritage is interchangeable with history rather than representative of the emotional response they originally developed in their customer. This idea of heritage as static history inhibits innovation, prevents dynamic renewal and impedes their ability to redefine, strengthen and position their brand in current and emerging marketplaces. This paper examines a number of heritage luxury brands that have successfully identified the original emotional responses they developed in their customers and, through innovative approaches in design, marketing, branding and distribution evoke these responses in contemporary consumers. Using heritage and innovation hand-in-hand, these brands have continued to grow and develop a vision of heritage that incorporates both historical and contemporary ideas to meet emerging customer needs. While what constitutes a ‘luxury’ item is constantly challenged in this era of accessible luxury products, up scaling and aspirational spending, this paper sees consumers’ emotional needs as the key element in defining the concept of luxury. These emotional qualities consistently remain relevant due to their ability to enhance a positive sense of identity for the brand user. Luxury is about the ‘experience’ not just the product providing the consumer with a sense of enhanced status or identity through invoked feelings of exclusivity, authenticity, quality, uniqueness and culture. This paper will analyse luxury heritage brands that have successfully combined these emotional values with those of their ‘heritage’ to create an aura of authenticity and nostalgia that appeals to contemporary consumers. Like luxury, the line where clothing becomes fashion is blurred in the contemporary fashion industry; however, consumer emotion again plays an important role. For example, clothing becomes ‘fashion’ for consumers when it affects their self perception rather than fulfilling basic functions of shelter and protection. Successful luxury heritage brands can enhance consumers’ sense of self by involving them in the ‘experience’ and ‘personality’ of the brand so they see it as a reflection of their own exclusiveness, authentic uniqueness, belonging and cultural value. Innovation is a valuable tool for heritage luxury brands to successfully generate these desired emotional responses and meet the evolving needs of contemporary consumers. While traditionally fashion has been a monologue from brand to consumer, new technology has given consumers a voice to engage brands in a conversation to express their evolving needs, ideas and feedback. As a result, in this consumer-empowered era of information sharing, this paper defines innovation as the ability of heritage luxury brands to develop new design and branding strategies in response to this consumer feedback while retaining the emotional core values of their heritage. This paper analyses how luxury heritage brands can effectively position themselves in the contemporary marketplace by separating heritage from history to incorporate innovative strategies that will appeal to consumer needs of today and tomorrow.

Do Australian public and nonprofit nurses cope with administrative stressors?

The nursing profession in Australia and other OECD countries such as the USA and the UK, have focused on ways to recruit and retain nurses (e.g., Bartram, Joiner, & Stanton, 2004). Research has shown that the most common factors impacting negatively on retention include sources of nursing stress such as workload and work environment. While the literature has shown that nursing staff encounter these stressors, studies do not examine the effects of stress caused by an increasing degree of administrative demand placed on nurses, caused by the new public management (NPM) reform in public and nonprofit (PNP) health care organizations. At best, some studies have alluded to some aspects of administrative related stressors (vis-a-vis nursing related stressors such as death, sickness, etc), but they have not been examined in any detail. Similarly, extant research has not examined how nurses cope with these administrative stressors. These will be the main aims of the present study.

Improving information security management in nonprofit organisations

All organisations, irrespective of size and type, need effective information security management (ISM) practices to protect vital organisational in- formation assets. However, little is known about the information security management practices of nonprofit organisations. Australian nonprofit organisations (NPOs) employed 889,900 people, managed 4.6 million volunteers and contributed $40,959 million to the economy during 2006-2007 (Australian Bureau of Statistics, 2009). This thesis describes the perceptions of information security management in two Australian NPOs and examines the appropriateness of the ISO 27002 information security management standard in an NPO context. The overall approach to the research is interpretive. A collective case study has been performed, consisting of two instrumental case studies with the researcher being embedded within two NPOs for extended periods of time. Data gathering and analysis was informed by grounded theory and action research, and the Technology Acceptance Model was utilised as a lens to explore the findings and provide limited generalisability to other contexts. The major findings include a distinct lack of information security management best practice in both organisations. ISM Governance and risk management was lacking and ISM policy was either outdated or non- existent. While some user focused ISM practices were evident, reference to standards, such as ISO 27002, were absent. The main factor that negatively impacted on ISM practices was the lack of resources available for ISM in the NPOs studied. Two novel aspects of information security dis- covered in this research were the importance of accuracy and consistency of information. The contribution of this research is a preliminary understanding of ISM practices and perceptions in NPOs. Recommendations for a new approach to managing information security management in nonprofit organisations have been proposed.

The nonprofit board as a team : pilot results and initial insights

There is a growing desire for boards of nonprofits to deliver better governance to the organizations they control. Consequently, self-evaluation has become an important tool for nonprofit boards to meet these expectations and demonstrate that they are discharging their responsibilities effectively. This article describes initial results aimed at developing a psychometrically sound, survey-based board evaluation instrument, based on the Team Development Survey (TDS), that assesses the team attributes of an organization’s board. Our results indicate that while constructs applicable to teams generally appear to apply to boards, there are also important differences. We highlight how a perception of board objective clarity, appropriate skills mix, resource availability, and psychological safety were positively and significantly associated with measures of board, management and organizational performance.

The Australian nonprofit sector legal and accounting almanac 2011

Summaries of legal cases, legislation and developments in law and accounting relevant to nonprofit organisations and charity law during 2011; including articles on special issues such as accounting standards and the chart of accounts; law reform (e.g. the new national regulator, the Australian Charities and Not-for-profits Commission); and taxation.

Introductory Chapter to The Economics of Nonprofit Enterprises

Nonprofit organizations present the analyst with a slew of puzzles. To an economist conditioned to think in terms of objectives and constraints, even the mathematical definition of the beast is a problem. What is a nonprofit organization? How does this definition shape the elaboration of objectives and constraints?

The GST Compliance Costs Of Nonprofit Organisations

On 2 December 1998, the Federal Government tabled their policy paper entitled Regulation Impact Statement for the Introduction of a Goods and Services Tax (RIS) in the House of Representatives. The Federal Government predicted that total gross GST compliance costs to Australian businesses in the first year of implementation would be approximately $1,912 million (or $1,195 per firm). Furthermore, it is estimated that the recurrent net compliance costs will be much lower at $131 per firm. Whilst the government made brief references to charitable organisations in their analysis, it stated that the compliance costs faced by nonprofits would, in substance, be no different to the compliance costs faced by businesses or government departments. This paper examines the RIS process in relation to nonprofit organisations in the context of recent taxation legislation affecting nonprofit organisations. It argues that the assumption that nonprofit compliance costs are similar to government and business costs is flawed and makes a case for the RIS process to be reformed to include more appropriate assessments of the impact of legislation on nonprofit enterprises.

Entrepreneurship : from denial to discovery in nonprofit art museums?

This research explores the function of entrepreneurship in nonprofit art museums. Traditionally, entrepreneurship literature features debates on customer orientation and innovation. This paper reviews a tension in entrepreneurship: the relationship between limited funding and the need to innovate in nonprofit art museums. The paper develops a construct by which to explain the structure of entrepreneurship in nonprofit art museums in Australia and New Zealand since 1975. From this discussion, different strategies and tensions are highlighted that nonprofit art museum directors have used. The dynamics are explored in ten large art museums and the managerial implications are developed.