Governance for the non-profit sector

30 July 2014 | Mthandazo Ngwenya | Opinion

Tshikululu has played an active role in support of amending and updating the current King III Codes, in its submission to the King Committee on Corporate Governance. This submission was made to suggest that the codes be made more adaptable for the not-for-profit (NPO) sector, which battles to apply these corporate-minded governance codes in its social context.

Mthandazo Ngwenya, Chief Financial Officer

The King III codes do not speak directly to the specific circumstances of non-profit organisations, private companies and entities in the public sector. Currently, the compliance recommendations are onerous to small operators, and in particular to the NPO sector, which survives on donations.

One of the main challenges faced by the sector is that international funders look to the King III guidelines as their base and inadvertently place pressure on the NPO sector to comply with increasing governance demands.

Tshikululu is in full support of the proposed amendment to the King III codes and also believes that a common way forward needs to be found; where compliance is taken seriously and seen as enhancing value. Tshikululu, as an organisation, has gained the trust of its clients and cemented its reputation in South Africa through the application of strict governance standards, and believes that similar successes can be achieved in the social sector.

In the past two years Tshikululu has delivered governance training for NPOs and other trustees of various public benefit organisation trusts. This has involved targeted training programmes and the development of best-practice guidelines by Tshikululu to assist NPOs. These guideline documents are made available on our website to our stakeholders and prospective clients.

In line with the increased importance on strong governance structures, Tshikululu will also make governance a key focus of future serious social investing (SSI) conferences, which we have traditionally held annually at the Gordon Institute of Business Science.

Tshikululu has long been an active player in promoting discourse between government, business and the social sector, and looks forward to continuing to play a vital part in the South African development landscape.