From John Dickson's Desk

I was relaxing over the Easter weekend, reading the Courier Mail (perhaps my first mistake) with my feet up on the back deck, when two articles took my attention.

The first one highlighted issues facing the Board of the Queensland State RSL Branch (not to be confused with individual RSL Clubs) relating to Fringe Benefits Tax (FBT), which comes off the back of other recent publicised concerns over State RSL Branch management in both New South Wales and South Australia.

The second article by Peter Cameron was an alleged “secret review” of Queensland’s 44,000 poker machines. The article claimed Queensland gaming machines resulted in $715 million in annual taxes to the State Government and suggests the prevalence of these pokies is in low socio-economic communities.

Now, seeing articles such as these in the newspaper comes as no surprise, however what continues to surprise me is the lack of general knowledge or commitment to robust Corporate Governance principles in the sectors where it is most paramount; charities, not-for-profit and the Community Club sectors.

“Corporate Governance is like insurance. Nobody really worries too much until something goes wrong and you need to make a claim.”

Having spent a good portion of my career researching, writing about, and developing Corporate Governance programs, I have seen time and time again, that when Corporate Governance goes wrong (or worse, public), the cost can be significant, particularly with damage to your community and member trust, loyalty and support as well as significant financial losses, internal disruption, criminal charges and fines or penalties may also apply.

Whilst the Queensland State RSL concern may just be an administrative oversight, the mere public format in which this is being reported generates consequences for the RSL brand, and possibly in confusion, RSL Clubs.

A probe into Queensland gaming sparks corporate governance questions for Club Boards and Committees because a licence to operate gaming machines in Queensland is granted by the State Government in exchange for community benefits. To a large extent, these community benefits are unspecified and left to the good Corporate Governance of community Club Boards and Committees, to do the right thing by their community and members and in turn, the Government.

You only have to take a look at the latest Australian Cricket Team saga to see that sadly, not everyone behaves in the right way, whether it be through apathy, ignorance, misunderstanding or desperation. If the Club Industry wishes to maintain the support of Government and the community in the licensing and operation of gaming machines, they must clearly and visibly demonstrate their corporate governance commitment to a Club’s purpose for being, it’s financial controls and decision-making processes in order they deliver the government, community and members’ expectations.

“There is a big governance problem right across Australian sport and it’s a very difficult thing to grapple with” – Lindsay Tanner, Chair Essendon Football Club quoted in the latest edition of the Australian Institute of Company Directors 

Whilst Corporate Governance is often considered a boring and complex subject, these newspaper articles are a stark reminder that it should be at the heart of charities, not-for-profit and community Club Boards and Committees. You need to be continually refreshing your knowledge, undertaking reviews of your policies and ensuring your charter always points in the right direction.

The Community Club Corporate Governance Landscape

• The NSW State Government has an increasing interest in Community Club Corporate Governance, with compulsory training already established. Recent significant changes to NSW gaming regulations now allow the Government the ability to step in where appropriate and issue financial penalties of up to $11,000 and disciplinary measures for Directors and Committees who breach Club Corporate Governance.
• The Victorian Government and State RSL Branch have also been aggressive in requiring corporate governance training of all their Club and branch Committee Members. I have been involved in designing and delivering this program in Victoria for over 12 years. I will also spend approximately 2 weeks next month rolling out additional corporate governance training to Victorian RSL Clubs and branches.
• The Queensland Government to date, has shown little interest in any form of compulsory Corporate Governance in the Community Club arena despite numerous approaches by several industry associations and individual Clubs over the years. Despite this, many Queensland Clubs are now writing compulsory Corporate Governance Training into their Constitutions.

I have spent the last 35 years developing and delivering detailed Corporate Governance programs for the Community Club sector. I encourage Clubs to draw on my many years’ experience, not only as a Club Manager but also as a Board Member and industry and tertiary qualified advisor for over 25 years. We offer a range of Corporate Governance options, that cover the fundamentals and clear examples of what you should and should not be doing, and we have a bit of fun along the way and keep the legal/corporate jargon to a minimum.

Corporate Governance Solutions:

• Corporate Governance ONE (1) day training for new Board & Committee Members
• Refresher training for existing Board & Committee Members
• Topic-specific workshops around key areas of concern

If these newspaper articles struck a chord with you too, get in touch and see if we can update your Board or Committee's understanding of Corporate Governance with an informative workshop, customised to your own Club.

John Dickson | Chairman, DWS Hospitality Specialists

Mobile: 0417 721 942

Email: [email protected]