NFP Board Member Remuneration Report revealed

Better Boards has released a report, NFP Board Member Remuneration Report 2016, that explores the make up of Australasian not-for-profit boards.

The report provides a snapshot of the dynamics of Australasian not-for-profit boards and provides insights to help understand the changes in board structures and remuneration practices.

The 40-page report aims to provide valuable insight to not-for-profit organisations, boards, board members and others in the not-for-profit sector on the topics of board remuneration and structure.

Key findings include:

• Some or all board members are remunerated in 13.9 per cent of respondents’ organisations. This has decreased from 17 per cent in 2012-13.
• Approximately 38 per cent of respondents with non-remunerated boards supported the idea of remuneration, a further 14 per cent supported under certain circumstances. Remuneration was clearly not supported by 33 per cent of respondents, 5 per cent were undecided and 9 per cent could not be clearly categorised.
• The most commonly reported value of remuneration for a single board member in an average year was between $10,000 and $30,000. In 2012-13 the most commonly reported category was $5,000 – $10,000.
• The most commonly reported annual revenue of organisations that remunerated their boards was between $20 million and $50 million. In the total sample, the average annual revenue of respondents’ organisations was between $1 million and $5 million.
• Some form of board performance review was reported as regularly undertaken by 75 per cent of remunerated boards. However, only 6 per cent reported that the board’s performance was taken into account when determining remuneration.

“The incidence of board member remuneration has fluctuated over the time that Better Boards has conducted this survey. In 2011 14.7 per cent of respondents reported that their board was remunerated, this rose to 17 per cent in 2012-13 but has returned to 2011 levels with a finding of 13.7 per cent in 2016,” said Julia Duffy, Lead Researcher Better Boards Australasia.

“As was observed in the 2012-13 report this change is not enough to claim a statistically significant shift in the incidence of remuneration. Nevertheless, the number of board members from non-remunerated boards who indicated that they support the idea of remuneration in general, or in the future for their specific organisation, indicates that there may be future growth in this area, especially where organisations are able to grow and develop greater financial resources.

“The opinions of respondents shared in the long-worded answers indicate that there is a vast array of different perspectives on remuneration in the sector. Although many respondents argued either for or against remuneration, many others reported that they are undecided on the subject or felt that remuneration was only suitable in specific circumstances or on a case-by-case basis.”