Governance and Charity

This essay analyzes the importance of governance and charity in non-profit organizations. It discusses the recommendations provided in two articles and critiques them. The similarities and differences between the articles are also examined.

Running head: GOVERNANCE AND CHARITY
Governance and Charity
Name of the Student
Name of the University
Author Note

1GOVERNANCE AND CHARITY
Table of Contents
Introduction......................................................................................................................................2
Article 1: Governance for Good......................................................................................................2
Recommendations provided in the article.......................................................................................3
Critique of the Article......................................................................................................................4
Article 2: The Governance of Not-For-Profit Firms........................................................................4
Recommendations provided in the article.......................................................................................5
Critique of the Article......................................................................................................................5
Similarities and differences in the articles.......................................................................................5
Conclusion.......................................................................................................................................6
References........................................................................................................................................7

2GOVERNANCE AND CHARITY
Introduction
The economic inter dependency among the various nation states of the world have led to the
evolution of a complex system of capitalism (Kyriacou, Muinelo‐Gallo and Roca‐Sagalés 2015).
Earlier, the private players of a concerned country had the freedom to engage in any activity of
their choice. This proved to be immensely beneficial to them as their main objective was the
generation of more profit. As a result, they exploited the various resources of the Earth to the
extent that it started to be a burden on the human society and on the environment of the Earth.
This, in turn necessitated the private organizations to take some responsibility for their actions
(Patterson et al. 2017). Their activities had adverse consequences on the society in terms of
harming the poor people. As a consequence, the concept of charity organizations arose. Charity
organizations include all those businesses whose main objective is to provide some amount of
relief to the people who cannot provide themselves. The organization of such charity institutions
is important as they have to fulfill an entirely self less objective but the main vision of the
organization is also important. This essay seeks to analyze the institutions of such charity
organizations in the context of two articles such as “Governance for Good” written by the
Government of Australia and “The Governance of Not-For-Profit Firms” written by Glaesar
(2002). This essay seeks to analyze two articles and critically analyze them on the basis of the
main arguments as put forward by them.
Article 1: Governance for Good
The Government of Australia wrote an article entitled “Governance for good”. This
article discusses about the importance of the concept of ‘governance’ and the institution of the
charity organizations (Governance for good: The ACNC’s guide for charity board members,

3GOVERNANCE AND CHARITY
2019). The main contention of this article is how to institute the charity organization so that it
can carry out its functions in an efficient manner.However, there was been a change in the
outlook of the agency of the government (Tilt 2016). The increase in the scope of the
governmental activities is known as governance. According to the author, the very function of
governance is the activities, processes and relationships which ensures that a particular
institution is functioning in a proper manner (Boateng, Akamavi and Ndoro 2016). The article
also analyzes the concept of good governance (Governance for good: The ACNC’s guide for
charity board members, 2019). Governance refers to the social responsibility of the organizations
towards the public (Yang, Brennan and Wilkinson 2016). According to the article “Governance
for Good” the ACNC Act regulates the structural organization of the charity organization with
regards to the institution of the board members (Governance for good: The ACNC’s guide for
charity board members, 2019).
Recommendations provided in the article
The main recommendation provided in the article is how to institute the organization.
As a result, the article talks about the appointment of the board members and their functions. The
article also lays stress on the eligibility criteria of the board members and also spells out under
what circumstances they will be terminated from the organization. Such recommendation has
been made essential due to the fact that a charity organization has the immense task of ensuring
welfare of the human society. As a consequence, it is of utmost importance that the people
involved are of the highest ethical standard and maintains transparency..

4GOVERNANCE AND CHARITY
Critique of the Article
The article is critiques on the basis that it lays too much stress on its institution and not on
the main objective of such charity organisation. In other words, the authors of the article has
provided a clear detailed analysis of the nature of board members and what their main functions
are. It also mentions about the important requirements within such members and how they will
be terminated if they fail to uphold such standards. As a result, the article is too organizational in
approach. It has failed to mention about the importance of such charity organization and what
their main intentions are. The humane approach of the article is missing. There is a general
tendency of mechanism within the article which could have been avoided. The article however
mentions about the nature of board members and there is an important prerequisite of them
adhering to the principle of transparency and honesty in their work. The humane implications of
the organization of such institutions have been ignored in the paper (Mellor 2018).
Article 2: The Governance of Not-For-Profit Firms
The second article written by Glaesar (2002) titled “The Governance of Not-For-Profit
Firms” looks in to the various distinctions between a profit organization and a not for profit
organization as defined in the article “Governance for Good” (Governance for good: The
ACNC’s guide for charity board members, 2019). In the modern contemporary world of today,
the mechanistic nature of the organizations are given more preference. There is an absence of the
humane nature in such organizations (Breeze 2017). According to the article “The Governance of
Not-For-Profit Firms” the non profit organizations are outside the scope of the agency of the
government. As a result, there is a need to increase the power and authority og the board
members of the charity organization as they wield the sole responsibility of the fulfillment of the

5GOVERNANCE AND CHARITY
objectives of the organization (Chelliah, Boersma and Klettner 2015). However, the author of
this article harps on the tendency of the not for profit organizations to assume a profit motive,
especially those involved in the sphere of medicine. The profit motive of the private
organizations is an inherent aspect in this capitalist world.
Recommendations provided in the article
The main recommendation of the article is that the board members have the authority
and the power to ensure the achievement of the objectives of the organizations. The main
objective of any charity organization is that they must provide for the welfare of the people who
have been negatively affected by the activities of the private organization of the state. Such a
recommendation has been deemed to be essential because the survival of the human race is of
utmost desire. Moreover, they are entitled to a quality standard of living and staying in poverty is
a gross violation of this right.
Critique of the Article
The main critique of this article is somewhat similar to the previous article. The article
other written by Glaesar (2002) titled “The Governance of Not-For-Profit Firms” puts too much
emphasis on the organization of the charity institutions. It talks about the nature of the board
members and about their eligibility criteria in order to be a member of the board. Moreover, the
article fails to look in to the aspect of humanity and the necessity of such activities for the
society. As a result, the sociological implication of the article is missing and it is on this basis
that the article has been critiqued.

6GOVERNANCE AND CHARITY
Similarities and differences in the articles
The similarity between these two articles, one written by Glaesar (2002) titled “The
Governance of Not-For-Profit Firms” and the other written by the Government of Australia,
titled “Governance for good” discusses about the importance of charity organizations and how
they should be instituted in order to achieve their objective. The managers hardly worry about
the kind of products they give to the people as long as their revenue earning increases (Breeze
and Mohan 2016). This necessitates the institution of those organizations whose primary aim is
to serve human kind. More than half the population of the world do not have enough resources to
sustain themselves. They do not have the finances needed for food and shelter and thereby, are
deprived of basic means of subsistence. However, the articles fail to analyze this aspect of the
human society. The articles are similar to the extent that they concentrate on the structural
organization of the charity institutions.
The difference in the articles in that the article on “Governance for Good” talks about
the important aspect of governance. On the other hand, the one written by Glaesar (2002) titled
“The Governance of Not-For-Profit Firms” does not focus on governance much. It talks about
the importance of board members and the necessity of providing them with more power and
authority to ensure the fulfillment of their objectives. This article lays stress on the aspect that
non profit organizations do not come under the purview of the government.
Conclusion
In conclusion it is observed that the structure of any organization is important and that
it should be aligned with the objectives of that organization. The power given to the board
members of the charity organizations is important as they have the immense task of ensuring the

7GOVERNANCE AND CHARITY
fulfillment of their objectives of improving the welfare of the human society. However, they
must also look in to the fact that they are transparent in their dealings and should provide people
with any documentation f how they receive their funds. This is because of the fact that they are
indeed private organizations but their nature is not that of profit earning. Instead, they are
entrusted with the function of improving the standard of living of the people by taking them out
of poverty.

8GOVERNANCE AND CHARITY
References:
Glaeser, E.L., 2002. The governance of not-for-profit firms(No. w8921). National Bureau of
Economic Research.
Governance for good: The ACNC’s guide for charity board members. (2019). Government of
Australia.
Kyriacou, A.P., Muinelo‐Gallo, L. and Roca‐Sagalés, O., 2015. Fiscal decentralization and
regional disparities: The importance of good governance. Papers in Regional Science, 94(1),
pp.89-107.
Patterson, J., Schulz, K., Vervoort, J., Van Der Hel, S., Widerberg, O., Adler, C., Hurlbert, M.,
Anderton, K., Sethi, M. and Barau, A., 2017. Exploring the governance and politics of
transformations towards sustainability. Environmental Innovation and Societal Transitions, 24,
pp.1-16.
Tilt, C.A., 2016. Corporate social responsibility research: the importance of
context. International journal of corporate social responsibility, 1(1), p.2.
Boateng, A., Akamavi, R.K. and Ndoro, G., 2016. Measuring performance of non‐profit
organisations: evidence from large charities. Business Ethics: A European Review, 25(1), pp.59-
74.
Yang, Y., Brennan, I. and Wilkinson, M., 2016. Value similarity: the key to building public trust
in charitable organisations. Voluntary Sector Review, 7(1), pp.47-66.
Bennett, R., 2016. Factors contributing to the early failure of small new charity start-
ups. Journal of Small Business and Enterprise Development, 23(2), pp.333-348.

9GOVERNANCE AND CHARITY
Mellor, H.W., 2018. The role of voluntary organisations in social welfare. Routledge.
Breeze, B., 2017. The New Fundraisers: Who organises charitable giving in contemporary
society?. Policy Press.
Chelliah, J., Boersma, M. and Klettner, A., 2015, January. Governance challenges for not-for-
profit organisations: Empirical evidence in support of a contingency approach. In Australasian
Conference on Business and Social Sciences 2015, Sydney.
Breeze, B. and Mohan, J., 2016. The logic of charity: great expectations in hard times. Springer.