Key challenges include regulatory compliance, transparency and streamlining governance to mitigate risk. Adopting a modern governance software platform can assist with these and more. It can also help your organisation save money through improved security, better governance and compliance and increased operational efficiency. Here are some of 2024’s most important developments and 2025’s key trends.

Mandatory Tax Exemption Self-Reviews

As of 1 July 2023, the Australian Government’s new self-review regime is in place, meaning it covers the 2023–24 financial year. It’s intended to tighten the rules around self-assessment for income tax exemptions. In principle, per the Australian Taxation Office’s (ATO’s) website, the requirements are simple:

Non-charitable not-for-profits (NFPs) with an active Australian business number (ABN) need to lodge an annual NFP self-review return to confirm their eligibility to self-assess as income tax exempt.

You can lodge your review online using the ATO’s Online services for business portal, the ATO’s self-help phone service (if online services are inaccessible) or with your registered tax agent.

The changes don’t apply to Australian Charities and Not-for-Profits Commission (ACNC) registered charities. However, if they do apply to your organisation, then you should consider the following questions:

1. Is your organisation eligible to register as a charity?
2. Is your organisation eligible to self-assess as income tax exempt?
3. Are you required to lodge a tax return?

The ATO has provided resources for self-assessment, including an NFP self-review return factsheet and an NFP self-review return question guide on its Reporting requirements to self-assess income tax exemption web page.

Increased Reliance on Digital Platforms

NFPs are at risk from cybercriminals. As organisations of all types rely increasingly on digital platforms to collect, store and transact with user and customer data, they become more tempting targets for criminals.

The Australian Institute of Company Directors (AICD) and the Cyber Security Cooperative Research Centre (CSCRC) released a set of Cyber Security Governance Principles in 2022, becoming one of the AICD’s most downloaded resources.

They include a checklist for NFP directors and outline how organisations can mitigate cyber risks and respond effectively if an incident occurs.

It’s critical to ensure your board includes members who understand cyber risks and that all directors are equipped to make sound decisions about them.

These include the risks of using Artificial Intelligence (AI). AI has many practical uses, including streamlining communication, analysing data, automation, summarising information and creating visuals.

However, new hazards also exist, including biases, privacy concerns, and hallucinations (when AI systems generate inaccurate or nonsense outputs).

Adopting a digital governance platform can play a key role here, as any good solution will have security measured "baked-in" alongside tools for risk management, reporting and emergency responses.

More Board Diversity

Regulators, investors, stakeholders and board members alike have come to realise that diversity is good. Diverse boards improve returns and performance in times of crisis compared to non-diverse boards.

"Diversity" encompasses gender, gender identity, ethnic and cultural background, education and experience, social class and more.

The key benefit is that diverse boards have fewer "blind spots" and can better respond to a broader range of stakeholders. They avoid "groupthink" by drawing on a wider range of ideas and opinions when making decisions.

Ensuring your board has a suitable skills matrix and succession plans to bring an appropriate mix of people, skills, and other attributes into your NFP is essential for its success. Every organisation needs a strong talent pipeline, and NFPs are no exception.

Stricter Governance and Reporting Standards for Fundraising Activities

Financial reporting is critical for any organisation. Fundraising, meanwhile, is a key activity for most NFPs. Each State and Territory has different laws, but broadly speaking, the following activities are considered to be fundraising for a person, cause or organisation:

• Requesting donations (whether in person or online),
• Selling merchandise or memberships,
• Holding events to raise money.

Fundraising locally only requires legal compliance. However, you may need a license if your activities are online or span multiple states.

As each state and territory has rules for auditing fundraising, keeping accurate records and ensuring your NFP has strict governance and reporting systems is critical. It’s also essential to be across developments in ESG reporting, AASB activities relating to NFPs, ACNC and ATO reporting, requirements, and more.

How OnBoard’s Platform Can Help

Across all of the above concerns, board portal software can be critical in helping organisations meet their regulatory, financial and ethical obligations. We believe that OnBoard is the most effective such platform for most NFPs, as it:

• Offers a purpose-built solution for NFP governance and board management
• Fosters collaboration and quick decision-making with voting, surveys, and esignatures
• Allows directors to seamlessly switch between organisations to reduce cognitive load and improve efficiency
• Drives 100% adoption for NFP boards with dedicated support and training.

In addition to its bespoke NFP features, OnBoard offers assistance with integration and deployment, training and onboarding, and ongoing updates and development. Beyond the platform, OnBoard offers many free resources, such as our Board Meeting Agenda Template, Complete Guide to Running a Nonprofit Board Meeting, and more.

Further, we offer special NFP pricing to NFPs of all types and sizes. Contact us today for a free trial or to learn more about how OnBoard can benefit your organisation. We’d be delighted to assist.