Regulator has concerns over Royal Australasian College of Physicians’ use of charity funds

This article is more than 1 year old

This article is more than 1 year old

The Royal Australasian College of Physicians has been warned its charity status could be revoked if it fails to address regulator concerns about the use of charity funds for legal advice, hiring practices, and concerns about its handling of complaints.

The college was investigated by the Australian charities and not-for-profit commission (ACNC) after its board and president elections in March 2018.

Prof John Wilson was named president-elect and three new directors appointed to the board in a landslide victory: Prof Niki Ellis, Dr Jacqueline Small and Prof Paul Komesaroff.

Complaints were lodged with the college about the conduct of Wilson and the others during the election after thousands of college members were emailed and urged to vote for the four as part of a “reform ticket”. In particular, members were concerned that access to the email addresses of members might have breached the college bylaws or privacy law.

The board appointed a third party to review the complaints, but only a redacted report of the findings was released.

As a result of its investigation, ACNC issued the college with a compliance agreement in June. In a letter addressed to the college, obtained by Guardian Australia, the ACNC said it had concerns that the college “has failed to maintain accountability and transparency to its members”.

ACNC also said it had concerns the college had inappropriate reporting, management, and investigation of complaints, and a lack of appropriate whistle-blower protections. There was also concern over inappropriate management of charitable funds, including the provision of legal assistance.

Sign up to receive the top stories from Guardian Australia every morning

ACNC also flagged issues with inaccurate recording of board meeting minutes, and unsuitable decision-making processes with the hiring and firing of staff.

The regulator warned the college that its charity registration could be revoked if the organisation failed to address the concerns raised.

The college has agreed with ACNC to appoint corporate governance advisory firm Effective Governance to conduct a six-month review of the organisation’s practices, with full reporting to the ACNC, and a 12-month implementation of the recommendations arising from the Effective Governance review.

The college has promised members that a summary of all progress and final reports will be made available to members.

College president Associate Prof Mark Lane told Guardian Australia in a statement the board welcomed the investigation and “is committed to cooperating with the commission and the governance professional to improve board culture and governance”.