Incorporated Associations are registered legal entries under state or territory laws. They are frequently described as “not-for-profit,” yet a more precise term would be “for-purpose”. While they may resemble business, their core mission sets them apart. This distinction does not advocate for reckless financial decisions. Instead, it emphasises the importance of purpose, the reason the organisation exists and what it is to be a member.
There are thousands of local groups in our communities today, not just sports, theatre, and music groups; there are art, craft, hobbyists, repair cafés, makerspaces, environmental and many special-interest groups, ranging from sewing to amateur radio, open-source software, astronomy, technology, industry, science, and education. These organisations represent the lifeblood of local communities, serving as the social capital that binds local communities together.
Over the past five decades, I have had direct experience within Incorporated Associations, large and small, charitable, professional, and recreational. I have come to appreciate their exceptional value to society. What these organisations can accomplish is remarkable, many times more than their commercial or government counterparts using the same financial resources. I’m continually amazed by the outstanding achievements that even a small group of individuals can attain when bound by a shared purpose.
I have witnessed the transformative impact on people’s lives, often surpassing their original founding objectives. They provide a nurturing environment that allows individuals to grow, learn, develop valuable skills, forge new connections, expand employment networks, cultivate profound and lasting friendships, and sometimes even kindle the spark for further education or inspire individuals to establish an organisation or start a business.
While more money would undoubtedly address some of these challenges, they extend well beyond the obvious financial constraints from escalating costs, insurance, and the shrinking availability of suitable venues to host their activities.
A more critical issue is decreasing community engagement, becoming active members, running activities, and joining the associations’ board or committee. Both membership, operational and financial problems become inexorably linked, especially when communities mistake them for “fee-for-service” or charitable operations.
Membership of an association is not mere volunteerism nor blind adherence; it certainly isn’t linked to a transaction based on membership fees. The organisation’s Board or Committee (an interrogable term) differs significantly from a conventional employee structure within other entities and businesses. They are far more profound and meaningful as the people on these governing bodies are elected by their peers to champion the collective interests of all members. Essentially, the members form the heart and soul of any association, large or small. They are the lifeblood that courses through its veins, driving it forward, no matter the highs or lows it may experience.
Reduced membership participation can be attributed to many factors: reduced time flexibility due to the prevalence of casual, gig, and contract employment, the escalating cost of living, and the enduring repercussions of the pandemic. Along with a shifting pattern of social interaction due to the pervasive influence of continuous online spoon-fed entertainment and misinformation. This enormous digital landscape has narrowed community awareness of these local organisations that have always existed and been there for the community but have become invisible in the changing world.
Widespread confusion currently shrouds the concept of Incorporated Associations, extending far beyond the general public. We must proactively raise awareness and educate everyone about the significance and purpose of Incorporated Associations.
I have encountered this confusion among individuals who should most reasonably expect to possess a more nuanced understanding of the matter. This encompasses politicians, public servants, law practitioners, business professionals, and financial or insurance institutions. It even extends to people within their governing bodies, executives, employed staff, or volunteers within an Incorporated Association.
As an organisation grows and evolves, the governing body of an Incorporated Association may appoint an executive officer. This executive officer, in turn, assumes the responsibility for operations, recruiting and managing additional staff and volunteers, ensuring the efficient execution of the organisation’s purpose and strategies.
However, when this happens, many more legal, industrial relations, taxation, and other funding obligations become intricately woven into an organisation’s policies and procedures, further complicating matters. This complexity can easily overwhelm governing bodies, inundating them with various information and responsibilities. As the organisation expands, executives find themselves compelled to generate multiple reports related to risk, workplace health and safety (WHS), quality assurance, finances, human resources, and policy and procedure documentation, all requiring review and approval.
This leads to the question: why would anyone volunteer to serve on a governance body when confronted with such an imposing array of tasks, risk and complexity? Without a well-informed membership that supports and understands the purpose of the organisation.
Membership and the importance of purpose.
There is a distinct difference between the membership of an Incorporated Association and that of a for-profit service or subscription. The very nature of why the Incorporated Association exist is in its objectives, purpose, shared vision, and governance structure.
An Incorporated Association typically recruits members who hold a shared vision and purpose. Members of an Incorporated Association are committed to advancing the organisation’s cause, and their involvement goes beyond personal benefit. They actively contribute to the collective vision and may have a say in decision-making by electing fellow members to a board or committee to govern and represent their organisation.
On the other hand, membership in a for-profit service or subscription model is often driven by individual benefits or access to specific services or business objectives such as shareholder value or profit. In these cases, members subscribe to a service or pay for access, and the primary focus is on meeting individual needs or preferences rather than a shared mission. The relationship is transactional, with members seeking value for their investment.
In the context of an Incorporated Association, the election of boards by the membership is a mechanism to ensure democratic representation and decision-making. These boards are entrusted with the responsibility of steering the organisation toward its mission and upholding the collective interests of the members.
Organisations must recognise the pivotal role of an informed and engaged membership in their success, as it directly hinges on their understanding and genuine support of the organisation’s purpose, “the reason it exists”.
It is essential to acknowledge that governing bodies (Boards or committees), are meant to consist of rank-and-file members within the association. Their peers should elect these individuals to represent the organisation’s core purpose.
However, challenges always arise when governing bodies begin to select candidates. Regardless of how well-intentioned existing governance members’ efforts are to enhance the number of professional governance members, and regardless of a new candidate’s notoriety, professional background, or qualifications, their candidacy can pose a significant risk if they do not already share a profound understanding of the organisation’s central purpose. A lack of alignment can lead the organisation down unintended and adverse paths and even corruption.
Membership in an association carries an enduring responsibility to safeguard the organisation’s unwavering commitment to its core purpose. This responsibility remains unchanged, irrespective of the organisation’s size or the number of employees, executives, and professionals tasked with its operations.
Whether the association is a charitable endeavour dedicated to supporting the disadvantaged or a government-funded entity designed to deliver essential services, the ultimate responsibility for the organisation’s outcomes, both successes and failures, ultimately rests with its members.
The purpose is not only essential to any organisation; in an incorporated association, it serves as a compass for good governance, growth in membership, and long-term sustainability. Understanding and staying true to this mission is essential for achieving these critical objectives for all its members.
A well-defined purpose statement articulates the association’s core reason for existence. It clarifies the governing body’s role, directs members’ endorsement, and tells stakeholders what the organisation aims to achieve. With this clarity, the association can set clear goals, develop strategic plans, and make decisions that align with its mission.
Good governance hinges on effective leadership and decision-making processes. The purpose statement is a constant reminder of the organisation’s values and objectives, helping the governing body make decisions consistent with the organisation’s mission. It also facilitates transparency, as stakeholders can assess whether the association’s actions align with its stated purpose.
A compelling purpose statement can attract like-minded individuals and organisations with similar values and goals. People are naturally drawn to causes that resonate with them personally or professionally. By effectively communicating its mission, the association can recruit and retain members who are passionate about its purpose.
Understanding and emphasising the purpose statement can enhance member engagement. When members feel strongly connected to the organisation’s mission, they are more likely to participate in activities and actively contribute their skills while advocating for the association. This engagement fosters a sense of belonging and commitment among members.
A clear purpose statement is a powerful tool for advocacy and outreach. It allows the association to communicate its mission to external stakeholders, including policymakers, donors, and the wider community. When these stakeholders understand and support the organisation’s purpose, they are more likely to offer resources, funding, or partnerships.
An organisation’s long-term sustainability is closely tied to its ability to remain true to its mission. When the association consistently pursues its core purpose, it can build a strong reputation and track record, which can attract resources and support over time. Additionally, a clear mission can guide the association in adapting to changing circumstances while staying true to its fundamental goals.
The purpose statement is a foundational element in the development of strategic plans. It helps the association set priorities, allocate resources, and determine the most effective strategies for achieving its mission. Strategic planning informed by the purpose statement ensures that the organisation’s actions are purpose-driven and results-oriented.
To gauge its effectiveness, an association must measure its impact on its purpose. The purpose statement provides a benchmark against which the organisation can assess whether it is progressing toward its goals. This data-driven approach enables the association to improve its programs and initiatives continuously.
In conclusion, an incorporated association’s purpose statement is not just a static declaration but a dynamic force shaping the organisation’s governance, membership, and sustainability. By understanding, embracing, and consistently focusing on its mission, the association can cultivate a strong sense of purpose, attract dedicated members, and chart a path toward lasting impact and longevity.