Governance Challenges for Not-for-Profit Organisations: Empirical Evidence in Support of A Contingency Approach

This article presents empirical evidence of the governance challenges faced by Australian not-for-profit (NFP) organisations. Drawing on our collection of data through interviews and a survey, the paper explores perceptions of NFP leaders concerning key governance challenges, drawing implications for theory and practice in the area of NFP governance. The paper demonstrates that the effectiveness of governance systems is influenced by internal and external contingencies that NFP organisations face, such as variations in board roles, stakeholder and membership demands, funding arrangements, board member recruitment processes, skills of board members, and resources for training and development. The paper suggests the merit of a move away from prescriptive and normative models of NFP governance, contending that generic best practice governance standards for NFPs ought not to be further pursued. The paper highlights a role for a national NFP regulator in providing training and advice, as well as assistance with the development of appropriate governance systems according to contextual factors. JEL Classifications: L3, L5