Reflection: Is there any Difference between Catholic boards and Not for Profit (NFP) boards?

In governance literature, the Boards of Catholic ministries or organisations (here referred to as Catholic boards) are often categorised as a type of Not-For-Profit (NFP) board, with the distinction drawn between NFP boards and ‘for profit’ boards. While in general terms the responsibilities of all boards are similar, there are some important differences.

In Australia, the role of all types of boards has been defined by the Australian Institute of Company Directors as being responsible for the overall governance, management, and strategic direction of the organisation and for delivering accountable corporate performance in accordance with the organisation’s goals and objectives.

It is also worth noting that the same risks associated with personal liability for directors are faced by both NFP and Catholic boards.

All NFP boards will usually have what may be referred to as a ‘compass’ in the form of a constitution, a vision (sometimes called mission or purpose) and a set of values.  There are many similarities within these documents between Catholic boards and other boards in the NFP sector.

In my experience, good people with good intentions inhabit both types of board. Sadly, a quick analysis of any of the recent compliance proceedings or Royal Commissions, evidence some failures in following the board compass in the governance of for profit, NFP and Catholic organisations. Some boards had clearly lost their ‘line of sight’ to the provision of service at the grass roots of their organisations.

Canon Law

In the eyes of the regulators, all the usual roles and responsibilities of any board also apply to a Catholic board. However, in addition to these requirements there are two other layers of responsibility for Catholic boards, and these relate to Church Law (Canon law) and Formation. While these differences make the Catholic board roles more onerous, they also have the potential to make them more personally rewarding.

In addition to the obligations imposed upon boards by civil law, a Catholic board also has Canon law obligations. Governance in a Catholic context requires that certain principles of Catholic Social Teaching and practice will guide the board. Pursuant to Canon law the Catholic board will operate under a Public Juridic Person (PJP). In a governance sense the Catholic board only exists within the Catholic Church through the PJP. This adds an additional level of governance which does not exist for other NFP boards.

It is erroneously thought by some that all the roles of authority within the Catholic Church are held by ordained bishops, priests and vowed religious. In the 1960s, the Second Vatican Council defined the importance of the role of lay people (referred to as laity) in the mission of the Church. Recently Pope Francis once again highlighted the role, noting that all laity ‘share in the priestly, prophetic…and therefore have their own share in the mission…in the Church’. Serving on a Catholic board provides lay people with an opportunity for Catholic leadership. This involvement in governance and leadership is a vital ministry within the Church, one increasingly undertaken by lay people. We are blessed in Mercy Ministry Companions to have deeply committed directors in each of our ministries who undertake delegated responsibilities for the organisations in their care.

Ongoing Formation

The second additional responsibility for directors on Catholic boards is the requirement to engage in ongoing personal and group formation. Formation is a type of spiritual and educational program and forms an integral part of the board role. One practical example of this is that usually each Catholic board meeting begins with a prayer, often with time for personal reflection and sharing. Additional extensive formation sessions also form part of the annual board calendar, while another opportunity for spiritual renewal and reflection in the form of a retreat is also common practice.

For many Catholics, formation finishes with the completion of their Catholic school education. For others, it may continue through regular attendance at Mass and through parish educational programs. Belonging to a Catholic board provides a further opportunity for spiritual development and promotes a deepening knowledge of the Catholic faith. For some Catholic boards that fall under a Ministerial PJP, there is also the advantage of learning from the rich tradition of a founder’s charism (in our case at MMC, that of Catherine McAuley).

I believe that the extra duties of directors on Catholic boards can be seen as a bonus or fringe benefit to the role. Formation programs, encourage personal growth in spirituality, faith, and a deeper understanding of the Gospels.

Whatever our ministry involvement, we are all called to further the mission of Jesus in our encounters with others.

Iyla Davies OAM, Trustee Director, Mercy Ministry Companions

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