Inside the boardroom

Melanie spoke to The Boardroom Report about how NFPs are stretched thinner than ever, why philanthropists’ obsession with innovation is hurting the sector, and how poor urban design leads to poverty.

Boardroom Report (BR): What is the major challenge facing the not-for-profit sector at the moment?

Melanie Raymond (MR): We are seeing rising demand on the sector, particularly in health and human services, without the additional resources to meet it.

Poverty is rising and so is the need for help. Our job is to resource our organisation to achieve its mission and that’s never been more difficult. There is a point at which you cannot stretch anymore. We can’t do any more with less. You do all you can but when people’s lives are at stake, you can’t just cut corners.

BR: Do we need to see more philanthropy in Australia to fill that gap?

MR: There is a difference between the formal organised philanthropy – philanthropic funds and trusts – and just members of the public donating. We’ve seen enormous support and generosity towards us from the general public, from primary school children right through to a group of women who meet weekly to knit and sew.

The big philanthropic organisations can be incredibly limiting around grant criteria and priority areas. If you don't fit them, you miss out. We’ve had the case of being too big, too small, having some government funding, being in the wrong location, or the wrong age bracket. Trying to find the grant that will suit what we are trying to do, which is lift people out of homelessness into jobs and get on with their lives, is hard.

One of the challenges is that people tend to want to lay claim to innovation. There is not a great deal of mystery about the kind of interventions that work. We actually have programs that are already proven, but they tend to fall outside the innovation mantra because they aren't "new" enough.

BR: And what about government? What are the challenges the sector is facing with government funding?

MR: We’ve got government funding that I don’t know whether it will be ongoing next month, so I can’t tell you in three years’ time whether the funding will be there.

There are a lot of vested interests saying that the not-for-profit sector is part of the problem. We are not the problem. The problem is government policies that are not sharing wealth and opportunity, and not supporting the sector.

Governments often talk about their respect for place-based local organisations that are closest to their community, but when it comes to tendering, they are the organisations who miss out.

In some areas you can see large for-profit, global players moving into the traditional charity space and winning large contracts. It’s difficult to compete against an international provider when you're state-based. It’s not because what you do, or the impact you make isn't better, it’s simply that government finds it easy to work with a handful of large players.

Governments often talk about their respect for place-based local organisations that are closest to their community, but when it comes to tendering, they are the organisations who miss out.

BR: Do boards of NFPs increasingly have to look at diversifying their revenue then? How do they go about doing that?

MR: The board first off has to have very good financial data across the organisation that is accurate and true so that you can look at where you’re heading, not just next year but in five years.

This goes to ageing infrastructure as well – physical infrastructure, IT infrastructure – that needs funding and is never covered by grants. You need to be planning ahead for those. Our board looked at the shabby state of our buildings and over three years has had them all renovated pro-bono from the corporate sector.

That wasn’t dollars in the bank account but it was hundreds of thousands of dollars in-kind support for a massive upgrade of facilities that is meeting real human need that we could never have afforded otherwise.

There are different ways of gaining the resources for the organisation. We’ve established a small social enterprise café in our former garage, adjacent to our complex medical facility. We're now also negotiating the price of coffee beans and milk in order to train long-term unemployed youth.

We recognised we had high value real estate that we can make some money out of this, and it’s tracking well. I have to say we are not looking to create an empire of cafés. That would be off-mission. We are satisfied with our small outlet that caters to the needs of the trainees.

The board first off has to have very good financial data across the organisation that is accurate and true so that you can look at where you’re heading, not just next year but in five years.

BR: You are involved in urban renewal in Melbourne and Chair of Connected Communities Melbourne. Why are you so passionate about Melbourne? What it is about the city that makes you want to do that work?

MR: Melbourne is called the most progressive city in Australia but it’s also undergoing massive growth. My interest is in building communities, not buildings.

We made mistakes in the past where we built communities with no proper infrastructure transport or jobs. I want to make sure those mistakes aren’t replicated. To some extent they already have been, but being a voice for community consultation and collaboration for more place-based approaches that build the spirit of community and harmony into the design from the get-go, that’s what I want to do.

Take access to transport and infrastructure for outlying communities. It’s heartbreaking when you get a young person who left school early, then skilled up, got placed into a job. They’re very excited and then they are let down by the public transport system. The trains are late, the connections are late and we find that they’ve been sacked when they’ve been doing their level best to turn their lives around. Then they have to go back and start again.

That is just not good enough. Infrastructure issues and urban design are directly related to homelessness, crime and poverty.


Related viewing: Susan Pascoe AM FAICD, head of the Australian Charities and Not-for-Profits Commission, talks about how NFPs must communicate better to the public the good work they do.