Small Charities Library - Charity governance

An annual general meeting (AGM) is where a charity provides members with a report on its efforts over the previous year, as well as inform them of the charity’s financial situation.

AGMs allow members to ask questions of the charity’s board and leadership, and can often see new board or committee members elected.

Charities can make changes to their legal name, Responsible People (board or committee members) and governing document (the constitution or rules) at their AGM. When a small charity makes changes like these, it must notify the ACNC within 60 days.

When planning their AGM, small charities should:

• check their rules or governing document to ensure they comply with any requirements for their AGM, for example, that it be held on a certain date
• ensure they have enough eligible and suitable people ready to nominate for any board vacancies. If there are board elections, you will need someone to oversee them
• have an agenda that covers all requirements set out in your charity’s rules, and in any applicable legislation
• make it interesting – you might invite a guest speaker or pay tribute to volunteers, supporters and others close to your charity.

It is also vital to take notes (minutes) during the AGM, and to write up and distribute them soon afterwards.

For more information, see our guidance on AGMs, our AGM template and our factsheet on holding an AGM.

Beyond AGMs, charities will hold regular meetings to help get their work done.

Some meetings can be more informal, such as a sub-committee discussing work at a café. Other meetings will need to be 'official' and follow proper decision-making processes. Either way, charities should have rules and procedures in place.

They should be clear on the type of meeting being held (or required) and ensure the meeting proceeds accordingly. It is essential to compile an agenda before the meeting.

An agenda should cover:

• items to be discussed at the meeting, how long each should take and who will lead the discussion
• the purpose of each item being discussed – does a decision need to be made or does it just need to be noted, is advice being sought or is the matter for discussion only?

Other simple tips for holding effective meetings are to:

• consider putting priority items at the front of the agenda
• invite the right people to the meeting
• start on time if you have a quorum, and ensure you have a chair to run the meeting
• take notes, keep minutes and distribute those minutes after the meeting
• note action items and follow up on them.

For more information, see our factsheet on holding meetings.

A small charity’s governance is largely shaped by its Responsible People, meaning the process of choosing new board members is among the most important jobs your charity will undertake.

Board members must share a common commitment to your charity’s purpose and understand their duties as board members. The board as a whole needs to have the right mix of skills and experience to support your charity’s work.

Key steps in choosing a new board member are to:

• check your rules and any legislation that applies to your charity for processes on appointing new board members, and see if there needs to be a board election or if existing board members can fill the vacancy
• examine current members’ abilities, uncover any skill and knowledge gaps your board has, then aim to fill them
• think about how you’ll recruit a new board member
• have an induction plan and induction pack for the new board member.

Once the new board member is appointed, ensure you update your charity’s Responsible People in the ACNC Charity Portal.

For more information, see our factsheet on choosing a new board member.

Board manuals or induction packs are invaluable for new board or committee members. They serve as an initial introduction to the board, as well as an ongoing reference, and should include:

• general background information on the charity
• other important or official charity information, such as official documents, the rules or governing document, annual report, financials, and charity policies
• board or committee member roles and responsibilities
• ACNC-related information, including details on signing up to the Charity Portal, a list of Responsible People lodged with the ACNC, and the ACNC Governance Standards
• names and roles of key staff and fellow board or committee members, as well as a diagram explaining group structure
• a rundown of coming events, important dates and meetings
• an invitation to the new board member to ask questions.

A rundown of suggested induction pack contents is available on the Our Community website.

Annual reports help small charities to inform their supporters, donors and the wider public about their activities and financial position, and serve vital reporting and governance functions.

Many small charities fear the production of their annual report and worry that it will be a time-consuming task that will divert valuable (and limited) resources. However, solid pre-planning can help reduce the stress.

Charities should establish a timeline which plots deadlines and milestones for each stage of the report’s production. Throughout the year, they should look to gather and save material for the report, such as photos, statements, descriptions and stories.

You won’t be able to pre-prepare some sections (the financials, for example), but collating as much of the material for your annual report early will mean less stress for your charity later on.

The ACNC has developed a useful annual report template that your small charity can use.