AICD Small NFP Governance Checklist

by | Aug 18, 2026 | Resource of the Month, The Spark Briefing

Board self-assessment tool mapped to governance principles

Strong governance is not measured by compliance alone. It is reflected in a Board’s ability to provide clear direction, make informed decisions, manage risk and steward the organisation’s purpose over the long term. This checklist is designed by Australian Institute of Company Directors (AICD) to help small not-for-profit Boards reflect on their governance practices, identify opportunities for improvement and strengthen alignment with the AICD Not-for-Profit Governance Principles.

When to use this checklistHow to use this checklist
  • Use it as a practical self-assessment tool to review your Board’s governance practices.
  • Use it as part of an annual governance review or Board effectiveness review.
  • Use it during strategic planning or a strategy refresh to ensure governance supports the organisation’s future direction.
  • Use it when onboarding new directors to help them understand governance expectations.
  • Use it to identify governance strengths, gaps and priorities for continuous improvement.
  • Use it to support governance discussions with members, funders and other stakeholders where appropriate.
  • Refer to the AICD Not-for-Profit Governance Principles for guidance on each principle, then complete the corresponding checklist items.
  • Consider whether each item is Met, Partly Met or Needs Attention, based on your current governance practices.
  • Mark an item as Met only where the Board is satisfied there is appropriate evidence to support the assessment.
  • Use the notes column to record supporting evidence, observations, identified gaps, risks and agreed improvement actions.
  • At the end of the assessment, identify priority actions, assign responsibilities and agree realistic timeframes.
  • Revisit the checklist periodically to monitor progress and support continuous governance improvement.

 

Checklist

Checklist itemNotes / Evidence
Principle 1 – Purpose, vision and strategy
The NFP’s organisational purpose is understood by directors, employees and volunteers.Add notes / evidence
The board has a vision and strategy document setting out the next 3–5 years.Add notes / evidence
In developing the vision and strategy, the board has considered the types and levels of risk the NFP is prepared to take on.Add notes / evidence
The board understands the resources, including employees and volunteers, that will be needed to achieve the strategic goals.Add notes / evidence
The NFP uses practical methods, such as its website, to communicate purpose, vision and strategy to employees, volunteers and key stakeholders.Add notes / evidence
Principle 2 – Roles and responsibilities
The roles and responsibilities of the board, encompassing governance, oversight and strategic direction, are documented.Add notes / evidence
Each board director understands their individual duties and obligations, consistent with relevant legal and regulatory frameworks.Add notes / evidence
The responsibilities of the management team are well understood and set out in position descriptions.Add notes / evidence
Processes such as training and induction ensure employees and volunteers understand their responsibilities, including legal requirements for working with vulnerable people.Add notes / evidence
The board understands key third-party providers, including IT software and system providers.Add notes / evidence
The board receives the necessary reports aligned with the size and complexity of the NFP.Add notes / evidence
Principle 3 – Board composition and effectiveness
The board collectively represents the diversity of the community served by the NFP.Add notes / evidence
The board has the necessary skills, experiences and perspectives to effectively govern the NFP.Add notes / evidence
New directors are given sufficient support and education when joining the board, and ongoing directors are supported with regular learning and development.Add notes / evidence
The board meets at appropriate intervals, papers are concise and insightful, and meetings are well led by the chair.Add notes / evidence
There is a clear distinction between the oversight role of the chair and the management role of the CEO.Add notes / evidence
The board formally reflects at least annually on its performance and where improvements could be made.Add notes / evidence
Principle 4 – Risk management
The board regularly discusses the NFP’s risk appetite and documents this in a concise risk appetite statement and supporting risk register.Add notes / evidence
The board has a risk management framework or policy that outlines the approach to identifying, assessing and mitigating risk.Add notes / evidence
Low-cost and practical risk controls are implemented, reflecting the nature of the risk, the resourcing of the NFP, and the frontline employees or volunteers managing the risk.Add notes / evidence
The board receives reporting that allows it to have an informed view on how risk is being managed in the NFP.Add notes / evidence
The board meets the external auditor or accountant at least annually.Add notes / evidence
Principle 5 – Performance and accountability
The board sets clear expectations about what success looks like for the NFP.Add notes / evidence
The board receives reporting that helps it understand progress against purpose, strategy, finances and key outcomes.Add notes / evidence
The NFP has appropriate financial controls and budgeting processes for its size and complexity.Add notes / evidence
The board understands whether resources are being used effectively and sustainably.Add notes / evidence
The board communicates performance and accountability information to members, funders and other stakeholders as appropriate.Add notes / evidence
Principle 6 – Stakeholders
The board understands who the NFP’s key stakeholders are, including clients, beneficiaries, funders, partners, employees and volunteers.Add notes / evidence
The NFP has practical ways to listen to and understand stakeholder needs and expectations.Add notes / evidence
Stakeholder perspectives are considered in board decision-making where relevant.Add notes / evidence
The NFP communicates with stakeholders in a clear, accessible and timely way.Add notes / evidence
The board monitors whether stakeholder relationships support the NFP’s purpose and long-term impact.Add notes / evidence
Principle 7 – Sustainability
The board considers the NFP’s financial, workforce, operational and environmental sustainability.Add notes / evidence
The board understands the external trends and pressures that may affect the NFP’s future viability.Add notes / evidence
The NFP has plans to maintain or strengthen capability, funding and service continuity over time.Add notes / evidence
The board considers sustainability when making strategic decisions and allocating resources.Add notes / evidence
The board monitors whether the NFP remains resilient and able to deliver on purpose.Add notes / evidence
Principle 8 – Organisational culture
The board understands its role in shaping and overseeing organisational culture.Add notes / evidence
The NFP has clear values and expected behaviours that support its purpose.Add notes / evidence
The board and management promote ethical conduct, accountability, safety and inclusion.Add notes / evidence
There are practical ways for employees, volunteers and stakeholders to raise concerns safely.Add notes / evidence
The board receives information that helps it understand whether the desired culture is being lived across the organisation.Add notes / evidence

How can we help?

To learn more about not-for-profit Board governance and how our experts in the sector can help, please contact us at info@sparkstrategy.com.au.

Sources

  1. Australian Institute of Company Directors, Small NFP Governance Checklist, Not-for-Profit Governance Principles – Third Edition, April 2024, https://www.aicd.com.au/content/dam/aicd/pdf/tools-resources/nfp-governance-principles/small-nfp-governance-checklist.pdf
  2. Australian Institute of Company Directors, Not-for-Profit Governance Principles – Third Edition, April 2024, https://www.aicd.com.au/content/dam/aicd/pdf/tools-resources/nfp-governance-principles/aicd-nfp-governance-principles-2024.pdf