RSL Victoria’s transition from an incorporated association to a company limited by guarantee (CLG) was a key recommendation of the independent governance review commissioned by RSL Victoria and conducted by Andrew Whittaker from Thoughtpost Governance. The review concluded that, given the scale, complexity and responsibilities of the organisation, a company limited by guarantee would provide a more appropriate and sustainable governance framework.

A primary benefit of a CLG is that it provides a more robust, contemporary, and fit-for-purpose governance framework for a large, complex, state-wide organisation such as RSL Victoria. While the incorporated association model is suitable for small to medium, largely volunteer-run organisations, it was not designed for entities with significant assets, large workforces, complex regulatory obligations, substantial trading activities, and high public and reputational expectations.

Another benefit for governance and public confidence is that CLGs operates under the Corporations Act 2001 (Cth), which provides a nationally consistent governance regime. This includes clearer director duties, established standards of care and diligence, stronger financial reporting and audit requirements, and a substantial body of case law that gives clarity about how governance responsibilities are understood and applied.

In contrast, the incorporated association framework (our current arrangement under Victoria State Legislation) is more limited in scope and was developed primarily for smaller, less complex organisations to operate under a structure that provides limited safeguards to the community and members of the association.

Importantly, CLGs provides clearer role definition between members, directors and management. This clarity supports better decision-making, reduces ambiguity about authority and responsibility, and assists organisations to manage growth, complexity and change in an orderly way. Rather than concentrating power, this structure introduces the requirements of the Corporations Act essential to ensuring the governance of RSL Victoria meets the highest possible standards of accountability and transparency. A CLG will ensure that the board is capable of steering State Branch to deliver on its mission, along with a mature set of laws and precedence for resolving performance issues and protecting members and the community.

Another important consideration is the increasing level of regulatory and accountability expectations placed on RSL Victoria by the Victorian Government and other stakeholders in relation to the management of patriotic funds. These funds involve complex accounting, reporting and stewardship obligations that go beyond what many community-based organisations were originally designed to manage. A CLG provides a governance and reporting framework that is better aligned with these expectations, supports clearer oversight of restricted and trust-like funds, and strengthens confidence that such funds are being managed appropriately and in accordance with their purpose.

Similarly, RSL Victoria’s obligations as a registered charity regulated by the Australian Charities and Not-for-profits Commission (ACNC), including its status as a Deductible Gift Recipient for tax-deductible donations, require a high standard of governance, financial control, and transparency. A CLG is widely recognised by regulators, funders and donors as the standard structure for large charities, and it aligns more naturally with contemporary charity compliance, reporting and assurance requirements.

For these same reasons, this model should also be considered by some of the larger and more operationally complex Sub-Branches. Where Sub-Branches operate significant commercial activities, employ staff, manage substantial community assets, or administer charitable or patriotic funds, a CLG can provide a clearer and more sustainable governance framework for volunteers and greater confidence for members, regulators and the broader community.

In summary, the case for a company limited by guarantee is not about reducing accountability, shifting control away from members, or concentrating decision-making in committees. It is about adopting governance structures that better match the size, complexity and responsibilities of the organisation, whether at state or Sub-Branch level, while preserving member influence, meeting modern regulatory expectations, and strengthening the RSL’s capacity to serve veterans, their families and the community over the long term.

EXTERNAL LINKS

Click HERE for more information on company limited by guarantee (CLG).
Click HERE for more information on incorporated association.

A concern that has been expressed by some groups is that a CLG reduces member influence or weakens governance. This concern is unfounded. Members remain central to the governance framework. They retain key powers, including approving the constitution, appointing and removing directors in accordance with that constitution, receiving financial and annual reports, and holding the board to account. These rights are embedded in the Corporations Act and can be reinforced through a constitution designed to reflect the values, traditions and expectations of the RSL.

A key element of member accountability will be built into the structure of the Board and nominations process. This will need to be approved by the members at a General Meeting as part of the approval process to transition RSL Victoria to a CLG.

Coupled with this structure, mechanisms such as an independent nominations committee are intended to support, not replace, the role of members. A nominations committee does not appoint directors and does not override member choice. Its role is to assist by identifying, assessing and recommending suitably qualified candidates against agreed criteria, so that members are better informed when making decisions about board composition. This strengthens the transparency, consistency and quality of the process, while leaving the ultimate authority with the members as set out in the constitution and within the framework of the Corporations Act 2001 (Cth).

In relation to the recent sale of the land and buildings of a Sub-Branch and the application of proceeds, those monies must be managed within the established Patriotic Funds framework.

The current intention is that proceeds from sales will be preserved and managed within the Statewide Patriotic Fund arrangements for strategic allocation over time. This approach is deliberate as it enables disciplined decisions that maximise long-term benefit, including ensuring funds can be directed to areas of highest need and to growth corridors where veteran demand is increasing, rather than being committed quickly without the benefit of proper planning and prioritisation.

Where a closure or sale results in veterans transitioning to neighbouring Sub-Branches, we do consider requests and proposals from affected Sub-Branches, including support required to manage increased membership, wellbeing demand, and local service capacity. These decisions, however, require assessment against broader statewide priorities, sustainability considerations, and the specific purposes of Patriotic Funds. For that reason, we are cautious about making early commitments until we have sufficient clarity on needs, options, and the most effective long-term reinvestment pathway.

RSL Victoria State Branch acts as trustee on Sub-Branch properties as a safeguard to ensure that those assets are preserved for their intended purpose: the benefit of veterans and their families, both now and into the future.

This trustee role is a long-standing feature of the RSL governance framework in Victoria and reflects the special status of Sub-Branch properties as community and patriotic assets rather than ordinary commercial property.

This arrangement is consistent with the requirements of Victorian legislation governing veterans’ matters and the use of patriotic funds. These laws impose specific obligations on how assets acquired through patriotic effort, fundraising, or government support may be held, used, and, if necessary, redistributed. The trustee structure ensures compliance with those obligations and provides confidence to government and the broader community that these assets are being protected appropriately.

Experience has shown that, without an effective safeguard, Sub-Branch properties can become vulnerable over time. In some cases, Committees have been unduly influenced by external community groups or have evolved to include few or no veterans. In more serious cases, facilities have been used primarily for purposes unrelated to veterans and their families, contrary to the intent under which the assets were originally established or supported.

While these cases are not the norm, they do occur from time to time. The trustee role exists to protect both the asset and the Sub-Branch Committee itself by ensuring that decisions about use, redevelopment, or disposal of property remain aligned with veterans’ purposes and legislative requirements.

No. The trustee arrangement is not intended to be, and is not used as, a control mechanism over Sub-Branches. Day-to-day management, operation, and activation of facilities remains the responsibility of the local Sub-Branch, which is best placed to understand local veteran and community needs.

The role of State Branch is one of oversight and compliance. This includes involvement where there are significant changes proposed to the use of a building, major works, redevelopment, or disposal of an asset, securing of debt against the asset or where concerns arise about whether the facility continues to serve veterans and their families in line with its purpose.

Where a Sub-Branch can no longer operate, or where an asset is sold, any proceeds and remaining Patriotic Funds must be returned to the Patriotic Fund’s framework. This ensures that money raised for veterans is not lost, diverted, or privatised, but remains available to support veteran welfare and, where appropriate, future facilities for veterans and their families elsewhere in the state.

The trustee structure enables this to occur in an orderly, transparent, and lawful way, consistent with government requirements.

Sub-Branch properties are not just assets for current members; they are held in trust for future generations of veterans. The trustee arrangement helps ensure that these facilities, or the value they represent, are preserved in perpetuity for veteran purposes.

RSL Victoria also has an explicit responsibility, and an ongoing agreement with the State Government, to play this role within the overall governance framework. If the RSL does not manage this responsibility appropriately, government intervention becomes a real risk. Maintaining a clear, compliant trustee structure protects Sub-Branches, veterans, and the organisation as a whole.