Director remuneration | My Assignment Tutor

Agenda item 2.7: Director remunerationI know there has been discussion amongst my fellow directors in relation toproviding a level of remuneration to directors of GR8Kare, as we move into GR8Kare is continuing to grow and the aged care industry is notgetting any easier. As a result, there will be a need for all directors to putadditional time and effort into their roles.A couple of key things to note in relation to this decision:• The existing constitution of GR8Kare does not allow for directors tobe remunerated for their time. I have spoken to a number of ourmembers, and they are all in favour of changing the constitution toallow directors to be remunerated.• The ACNC does not prohibit remuneration of directors. Therefore,there should be no impact on our charitable status.• There is a growing trend among larger not-for-profit organisations,especially in aged care, to remunerate directors. The key reasons forthis are:The increasing time and risk levels associated with directorships.It improves an organisation’s ability to attract directors with therequisite skills and experience.Directors who are remunerated for their efforts tend to take on ahigher level of responsibility and accountability.Members have higher expectations of directors who are remuneratedfor their time.•. Some board members are more motivated by giving back to thecommunity rather than being remunerated.Other volunteers may have an issue with directors being paid.Given the above, I suggest that we move to providing remuneration fordirectors, effective from 1 January 2021. To progress this, I have briefedDominic to engage a lawyer to draft relevant changes to the constitution andwe have called a meeting of members to approve the changes to theconstitution on Friday 20 November 2020.

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