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By Nick Koerbin
What are the spending limits for an Association CEO?
I was visiting a newly appointed CEO of a well-known industry association, and we were discussing how much authority he had to spend on
operational items. I was surprised when he mentioned that his authority level was $300. Anything over that would have to go to the Board for
approval.
How much should an association or any organisation's CEO be allowed to spend?
Of course, it all depends on several factors, such as the size and financial health of the organisation. Having been a CEO of several
similar organisations, here are some suggested guidelines.
💡 Major spending decisions such as significant capital expenditure, acquisitions or investments must be given Board approval, as the Board
should have oversight and control of substantial financial decisions.
💡 Establish a risk assessment committee reporting to the Board to review the risk levels of entering any contract that may significantly
impact the association's financial performance.
💡 Ensure a budget includes the expenditure of planned operational activities, including hiring staff, professional development, membership
development and events.
💡 Have a defined policy regarding approval of expenses outside the budget.
💡 Ensure there is a delegation of authority for the CEO or senior manager regarding any limitations regarding their decision-making. This
authority should be reviewed annually, and details should be included in the Board meeting minutes.
💡 Ensure there is transparency in the financial reporting mechanisms to the Board. The CEO would be more productive by getting board
approval on budgeted spending than asking the Board for every decision.
The Association Board should provide all the resources and support to operational staff so they can get on with the job. However, ensure the
authority is documented in a board policy or organisation procedure and understood by all involved.
One of the most common — and often unexpected — challenges faced by association boards and leaders arises when a member develops a grievance against the organisation. In the association sector, this is not unusual. Most grievances begin with a concern or disagreement, but if not handled appropriately, they can escalate into a prolonged and disruptive issue.
Insights from the AES Technology Survey and Special Interest Group Discussion
Artificial Intelligence is now part of daily work for many association professionals.
Association Executive Services (AES) are soon to release its
annual report on technology in Australian Associations and recently facilitated a special interest group discussion on the use of AI in
participants' organisations.
The Challenge of Prorated Membership and Renewal Cycles
Anyone responsible for membership in an association understands this tension:
Do we renew members on the anniversary of their joining date, or operate on a single annual renewal date?
And if we operate on a single renewal date, how and when should prorated membership apply?
Here is a deeper exploration of each model — with practical examples drawn from real-world association operations.
How we help membership based, not-for-profit associations now and into the future.
