Member Code of Practice
The voluntary Code of Practice was endorsed by the Membership of Philanthropy Australia at its Annual General Meeting held on Wednesday, 24 April 2002.
The code is based on some key principles about giving in Australia, which Philanthropy Australia commends to its giving Members. If you are a Member or otherwise involved in the philanthropic community, Philanthropy Australia encourages you to share and discuss this document with the relevant staff and directors/trustees within your organisation.
Code of Practice
This voluntary Code of Practice constitutes a recommendation to full grant-making Philanthropy Australia members (as defined in the Constitution). Its aim is to encourage best practice, openness and transparency in all aspects of grant-making by these member organisations whether they are family foundations, corporate foundations or corporate giving programs, community foundations, private foundations or government-initiated foundations.
2. Principles of Good Practice
This code is based on some key principles about grant-making in Australia which Philanthropy Australia commends to its members. These include:
- Acknowledgment by grant-makers of the importance of operating in accordance with the wishes of founders who provided initial capital, or in the case of community foundations and corporations, which are dependent on multiple donations, the wishes and concerns of these donors.
- Commitment by grant-makers to the development and promotion of innovative, flexible and effective responses to specific social, cultural, environmental, educational, scientific, health and economic challenges in today’s society.
- Acceptance by grant-makers, that in fulfilling their particular role in helping build a just, sustainable and pluralistic society, it is important that there is openness, transparency, integrity, accountability and self-regulation in the provision of resources to grantees.
3. Legal Responsibilities
All Boards of grant-making members of Philanthropy Australia should be aware of the legal duties and obligations imposed on grant-making member trustees. In summary, the major duties imposed on a trustee comprise:
- The duty of the trustee to avoid conflicts of interest – a trustee should not put himself or herself in a position where the trustee’s own interests conflict with the interests of the beneficiaries
- The duty of the trustee not to make a personal profit from the position of trustee
- The duty of the trustee to act in the best interests of the beneficiaries
- The duty of the trustee to comply with the relevant trust instrument – the trustee should be familiar with the terms of the trust instrument
- The duty of the trustee to use ordinary business prudence when investing funds on behalf of the trust, and
- The duty of the trustee to seek advice where the trustee is unsure whether he or she is complying with one of the above duties
Additional duties may apply if the grant-making member trustee is a corporate trustee. The Board of a grant-making member that has corporate trustees should therefore be fully appraised of and comply with such additional duties.
The above is not intended to be a complete explanation of the legal principles that apply to trustees. If Boards of grant-making members have any doubt as to which duties apply to them or whether they are in compliance with particular duties, the Board should seek independent advice.
This code of conduct is a voluntary code. However, adherence to the code by grant-making members will ensure that members have a high standard of corporate governance that will in turn foster good practices and enhance public confidence in the integrity of the member.