Should board members of a CSO be paid?

In our organisation, board members get a small honorarium for attending meetings. I’ve heard some people say this is wrong for a non-profit.

The NPO Act 2019 defines a non-profit organisation as one that “carries on its business without pecuniary gain to its members or officers except as reasonable compensation for services rendered.” So the Act does not absolutely prohibit all payments to board members.

In practice:

• Board members generally serve voluntarily — this is the norm
• Reimbursement of out-of-pocket expenses is universally accepted
• Nominal honoraria for attending meetings are practised by some but should be approved independently and disclosed

The key risk of board remuneration is that it can compromise the independence and objectivity of board members. If your organisation chooses to pay honoraria, ensure this is stated in your constitution, approved at the AGM, and disclosed publicly.