Rational governance in non -profit organizations is the cornerstone of building effective and transparent institutions capable of achieving a sustainable social impact. With the rapid growth of the role of these organizations in meeting the needs of societies and enhancing comprehensive development, governance practices have become a strategic necessity, not an organizational option.
Governance means, in essence, a set of operations and structures through which the organization is directed and monitored, including identifying responsibilities and powers, drafting policies, evaluating institutional performance, and ensuring the institution’s commitment to its mission and basic values.
The Board of Directors plays a pivotal role in this context, as it has to supervise the strategic approach, ensure financial integrity, and evaluate the efficiency of executive management.
Community Partners, 2023 data indicates that non -profit organizations that apply effective governance systems achieve 25% higher financial performance compared to organizations that lack these practices.
In a report issued by Standards for Excellence Institute, it was found that institutions that adhere to governance standards achieve a 73% retaining rate, compared to only 45% in weak governance institutions.
On the Arab level, a study issued by the Regional Center for Civil Society Development (2022) confirms that 58% of non -profit organizations in the region suffer from the absence of clear governance policies, which negatively reflects its ability to attract financing and enhance institutional partnerships.
On the other hand, the “King Khalid Charitable Foundation” experience in the Kingdom of Saudi Arabia appears as a successful model in consolidating institutional governance, by adopting a clear organizational structure, activating specialized committees, and adopting annual transparent reports subject to an independent external review.
The basic principles of good governance include:
• Transparency: By disclosing financial statements, activities, and project details.
• Accountability: by identifying roles, responsibilities and controlling implementation.
• Justice: in representing the stakeholders within the ruling bodies.
Effectiveness: By evaluating performance and making data based on data.
• Response: by interacting with the needs of society and adapting to changes.
Moreover, financial oversight and organizational compliance are among the important pillars of governance. A study by Grant Thornton (2021) confirms that 81% of non -profit institutions that are subject to an independent financial review annually have higher confidence than donors, compared to only 42% for institutions that do not adopt this procedure.
In light of a legislative and societal environment that tends towards more professionalism and oversight, non -profit organizations must invest in developing their provisions, including training councils, updating their internal regulations, and activating institutional performance evaluation tools.
Governance is not just an organizational tool, but rather a strategic compass that ensures the organization’s survival on the right path, enhances its credibility, and expands its ability to achieve a tangible and sustainable impact on society.
