Separation of Authority

Separation of Authority

A Good Governance Guide from the Governance Institute of Australia (3 of 4)

Posted on 24.11.2017

Overview

The third in a series of 4 articles focusing on governance in the not for profit sector.

The content is based on information from resources provided by the Governance Institute of Australia 

Separation of authority between board and management

It is considered good governance for a not-for-profit (NFP) organisation to have clear guidelines determining the boundaries between the duties of the board and the managers of day-to-day activities of the organisation.

It is good practice for an organisation to adopt two documents to provide clarity regarding the delineation of board and management activities: a ‘statement of matters reserved for the board’ and a ‘delegation of authority’ policy. An organisation following good governance practice will also have a board charter or terms of reference accompanying these two documents.

Statement of matters reserved for the board
The statement of matters reserved for the board identifies those decisions which are to be made by the board and not delegated to management. This may include:

  • holding responsibility for the overall leadership of the organisation and setting the direction, culture and values
  • setting the risk appetite for the organisation
  • approving strategic aims and objectives of the organisation as a whole
  • read more

Delegation of authority policy
The ‘delegation of authority’ policy describes those matters delegated by the board to management, including the specific role those matters are delegated to as well as any limits on that delegation. It is important for the board to understand that, while it can delegate authority to make decisions, it cannot delegate its responsibility.

Policies generally can be stated in either of two ways; specifying what the delegate can do, or specifying what the delegate can’t do. It is good governance to clarify what can be done and preparation of a delegation of authority in tabular form is often a good approach to keep it simple and easy to understand.

A delegation of authority policy may include the following matters, depending on the size and complexity of the organisation:

  • financial delegations
  • authority to enter into material contracts
  • approval of policies
  • read more

Source
Good Governance Guides
Governance Institute of Australia

For more information and resources on governance for your organisation go to GOVERNANCE

 

 

 

Share

FacebookTwitter

Have a story to tell or news to share?

Let us know by Submitting a News Story

Discover Queensland

Explore all of Queensland’s adventures.

Start Exploring

What's On

Aug

15

Scenic Rim Ultra

Scenic Rim Ultra

Read more

Aug

30

Kooralbyn Valley MTB 6hr Endurance

Kooralbyn Valley MTB Endurance 6hr Enduro 10 km loop
Read more

Sep

05

Bushwalking Leader Training Course

Is it time to get recognised qualifications for your outdoor recreation skills?
Read more

Latest News

Billions in cancelled holidays

Travel agents decimated

Read more
Questions raised about honesty-reliant system

Queensland's coronavirus border breaches raise questions

Read more
JobKeeper criteria relaxed

Government will ease JobKeeper criteria, adding $15 billion to the coronavirus recovery scheme

Read more

Become a member

We welcome applications for new Community and Green Circle Members from organisations and individuals involved in the outdoors

Learn More
Tail Lights by Georgina Pratten