Not for profit organisations (NFPs) play an important role in our society, yet there is no universal definition of the sector nor an all-encompassing measure of its contribution. This reflects the diverse purpose, funding, reliance on volunteers, size and structure of organisations that primarily operate for a social or community purpose (rather than the financial gain of its members). In economic terms, NFPs contribute between 4%–5% of GDP in Australia and New Zealand and are significant employers. Volunteering and ‘in-kind’ support are significant in the sector.
The need to manage risk effectively
Passion and the cause may be an NFP organisation’s pulse, but they may not always protect it from unwise decisions, mismanagement, or human fallibility. Equally, finding new and more effective ways to support the organisation’s clients, members and cause may involves taking greater risk, sometimes not being successful, and learning from its successes, failures and near misses. Accordingly, good governance requires an NFP to find the right balance between taking risks on an informed basis, treating (dealing with) those risks that are undesirable, and having the confidence that the organisation can bear its level of risk in pursuing its objectives.
For the NFP’s stakeholders, what matters most is not what happens in the face of uncertainty, but rather how well the organisation deals with a change in circumstances, the unthinkable or the unforeseen happening — bad and good. As uncertainty and risk are implicit in decision-making and risk is generated and controlled at all levels of the organisation, managing the NFP’s risks effectively benefits all stakeholders.
Broadleaf works a great deal in the NFP sector. Grant Purdy was a co-author of the authoritative guide to managing risk in these organisations, HB 266:2010 Guide for managing risk in not-for-profit organisations. This handbook gives NFPs full advice on how they can establish and improve an effective approach for managing risk that is aligned with the Australian, New Zealand and International standard, ISO 31000:2009.
Some of the NFPs with which we have worked are noted below.
The Australian Ballet
Broadleaf developed a range of tools and materials to help the Ballet manage risk more effectively. We then use those tools during a facilitated workshop that identified and analysed the major strategic and operational risks faced by the Ballet. A risk treatment plan was developed.
Bethany Community Support
As part of a strategic planning retreat for executive and board members, Broadleaf facilitated a risk assessment workshop that developed a risk treatment plan.
Centre for Multicultural Youth
Broadleaf facilitated the development of the business plan with the executive team, including measurable outcomes. We then facilitated a risk assessment to stress test the draft plan and helped develop a risk treatment plan.
We have also facilitated a workshop to understand the risk associated with a project to open two rural offices. This led to development of a risk treatment plan.
12 months after the offices opened Broadleaf facilitated a post project review using root cause analysis. This captured the lessons learned.
Eastern Domestic Violence Service (EDVOS)
Broadleaf helped developed risk assessment tools and then facilitated a risk assessment for the Service.
Guide Dogs NSW/ACT
Broadleaf helped the Risk Management Committee and the Board of Guide Dogs NSW and ACT to review its approach to risk management, formulate a policy statement and develop a context description for the organisation.
Guide Dogs NSW/ACT is the state's largest provider of guide dogs to people who are blind and vision impaired. The organisation trains people with impaired vision to use canes, canines and electronic aids to improve their mobility, independence and safety. To donate to Guide Dogs, please visit their website.
International Organisation for Migration
Broadleaf developed the risk management framework for this UN-affiliated body. Working in its Geneva head office, we helped the management team evaluate their current approach to manage risk and then guided them in the development of a new set of tools and methods aligned with ISO 31000 to be used in the future.
With a focus on integration, we facilitated the development of a two-year implementation plan with a significant training component.
Melbourne Youth Music
As part of the strategic planning process, Broadleaf facilitated a risk assessment that stress-tested the plan objectives. This led to a risk treatment plan for the NFP.
World Vision India
World Vision India is a Christian humanitarian organisation working to create lasting change in the lives of children, families and communities living in poverty and injustice. World Vision serves all people regardless of religion, caste, race, ethnicity or gender. All development work World Vision India carries out is focused on building the capacity and ability of communities and families to ensure the wellbeing of children. The wellbeing of children includes ensuring children have access to education, health, protection and participation.
Two senior executives of World Vision India attended an enterprise risk management workshop in Mumbai, conducted by Broadleaf with its Indian partners Sama Audit Systems & Softwares. Since then we have assisted World Vision India by providing peer reviews of its ERM framework and processes on a pro bono basis.
To find out about helping World Vision India with sponsorship, please visit their website.