Nonprofit boards in Australia: a distinctive governance approach

This article reports the findings into patterns of governance on nonprofit boards in Australia. The research surveys 118 boards, upon which serve a to tal of 1405 directors. The findings indicate that nonprofit boards can mimic some aspects of a sha reholder approach to governance. But nonprofit boards, in the main, indicat e priorities and activities of a stakeholder approach to governance. The fe atures of 'isomorphism' that arise largely stem from legislative requiremen ts in corporate governance. Generally, nonprofit directors are influenced b y agenda and motivations that can be differentiated from the influences upo n director activity in the corporate sector. The study indicates that nonprofit boards prize knowledge and loyalty to th e sector when considering board composition. The survey suggests nonprofits "compensate" for the demands placed upon them about fiduciary duty and due diligence responsibilities with the diverse intellectual expertise of non- executive directors. Nonprofit boards possess greater diversity than boards in the corporate sector; they include more women as directors than corpora te boards and they include a greater proportion of directors from minority groups. While strategic issues feature significantly as a task of the nonpr ofit board, they distinguish themselves from their corporate counterparts b y engaging in operational management. The findings indicate that, in the main, directors on nonprofit boards deli berate and operate in ways distinctive from their corporate counterparts. S uch findings offer a contribution to the reform of Corporations Law in othe r countries and the likely consequence on boards outside the corporate sect or.