The Charities Amendment Act 2023, which was promulgated in the middle of 2023, introduces significant changes to the Charities Act 2005. Some of the more impactful changes have already come into force, and this update outlines what those changes are.One important change is the new requirement that charities review their governance procedures every three years. These reviews should assess whether the procedures, within or beyond their rules, effectively help the charity achieve its purposes and comply with the Charities Act. Regular document reviews and updates of rules and procedures are advisable to ensure effective and efficient charity management.Another significant change is the broadened definition of "officer" under section 4. Now, anyone who holds significant influence over an entity's major decisions, including its management or administration, is considered an officer. This definition includes trustees, board members, or anyone in a position, like a chief executive or treasurer, who can exercise substantial influence. Additionally, "deemed directors," or those whose directions the entity regularly follows, are now included. This broader definition requires charities to clearly differentiate between governance and management roles and to be mindful of the influence exerted by those in management.Section 36C empowers the Charities Registration Board to disqualify individuals from serving as officers for up to five years. Previously, the Board could only deregister the entire entity to remove an officer. Grounds for disqualification include serious wrongdoing related to the charity or significant and persistent failure to meet obligations under the Charities Act or other laws. The new provision enhances the Board's authority, although the exact circumstances for its use remain unclear. Notably, the Board is no longer required to notify the Registrar of Incorporated Societies of a banning order.If you would like further information as to how the Charities Amendment Act 2023 may impact your charity, please do not hesitate to contact one of our experts. Our team is here to help you navigate these changes and ensure your charity remains compliant and effective.
