We're a Baker Tilly network member
Learn more
A meeting of minds
Client story

A meeting of minds

Merging organisations shouldn’t be about survival, it should be based on opportunity and potential. While Not-for-Profits (NFPs) often find themselves in perilous financial positions as funding and policies shift around them while their needs grow, a merger can provide much more than just financial stability, as Circle Green Community Legal (Circle Green) found.

For Circle Green, the necessary ingredients for a successful merger were mutual respect, patience, understanding and a vested interest in a common goal. When these qualities are held by all directors and management of merging organisations it is easier to reach consensus around critical decisions related to strategy and direction.

Ensuring a harmonious environment can be challenging during NFP mergers and the subsequent unification of boards – bringing historical ‘baggage’ to a newly merged organisation can create problems.

Circle Green formed a new board post-merger, bringing together three members from each organisation involved in the amalgamation – the Employment Law Centre of WA, The Humanitarian Group and Tenancy WA.

Circle Green’s CEO Sara Kane and Chairperson Emma Watton shared their insights with Pitcher Partners on what they believe contributed towards their success story.

Ms Kane and Ms Watton highlighted the importance of board members having high levels of emotional maturity to regulate themselves and each other, being active contributors and having a genuine commitment to the newly formed organisation.

Ms Watton called attention to the need for board members of the merged entity to approach the new organisation with a fresh perspective and without prejudice, minimising the risk of petty arguments over miniscule issues.

“If a new perspective is not formed then their alliance to their previous organisation will take over resulting in a clash of egos and logos”, said Ms Watton.

As highlighted by Ms Watton, respectful listening is key to the success of any board, especially newly merged ones. If members are unable to listen to each other and respect the point of view of another member and the thought process behind their argument, then the organisation will suffer disruption and staggered progress.

If a board member’s motivation appears swayed in their decision-making abilities, then it’s important to respectfully call them out, regardless of how difficult this may be.

As the pair pointed out, it can be useful to have an independent perspective on the newly forming board. “It is probably the one area the emerging Circle Green board was missing, so we invited a very experienced person in as a guest to co-chair for a short but critical period where significant governance and planning decisions were made,” shared Ms Watton.

To overcome legacy issues, onboarding new directors at the integration stage can significantly help dynamic and working relationships. Given the importance of facilitation in the role of Chairperson, introducing an independent person into this role can be particularly powerful.

There are three distinct stages in the merger process as outlined below:

  1. Consideration: Organisations complete due diligence towards the merger.
  2. Formation: Some members from each organisation sit on both their original boards and the temporary board whose job is to oversee the formation.
  3. Emergence: The new organisation and board comes into being.

Utilising professional advisers can be beneficial to the merger process as they can also act as a mediator, assisting in balanced decision making. This is particularly helpful in circumstances where board members struggle to agree or if members are having trouble with habit-based decisions.

Once the new board has found its operating rhythm it is critical to establish the right leadership team that has the capabilities and vision to bring the organisations together.

“Trust and alignment between the leadership team and board is critical,” said Ms Watton. It is important to identify areas where this doesn’t exist and act on changing this immediately.

New team dynamics and roles should be thoroughly communicated by the board to all relevant stakeholders, particularly staff as early as possible, with regular updates to be provided on changes to plans and preparations. As explained by Ms Kane, the board needs to be visible to staff.

“It will never be simple… You need to be prepared to keep turning up and facing the headwind with compassion and forethought,” said Ms Kane.

The merging of a board of directors is the merging of more than just individuals in a room, it is a meeting of minds and purpose that protects the integrity of a NFP while looking to the future to expand impact and reach.

Pitcher Partners Not-for-Profit survey seeks to unveil the future challenges facing NFPs. If you would like to share your insights, then complete the Pitcher Partners survey here.

For more information about Circle Green Community Legal click here.

This content is general commentary only and does not constitute advice. Before making any decision or taking any action in relation to the content, you should consult your professional advisor. To the maximum extent permitted by law, neither Pitcher Partners or its affiliated entities, nor any of our employees will be liable for any loss, damage, liability or claim whatsoever suffered or incurred arising directly or indirectly out of the use or reliance on the material contained in this content. Pitcher Partners is an association of independent firms. Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities. Liability limited by a scheme approved under professional standards legislation.

Our experts

Andrew Faulkner

Andrew Faulkner

Principal Adelaide
Cheryl Mason

Cheryl Mason

Partner Brisbane
Mark Harrison

Mark Harrison

Partner Melbourne
Christian Golding

Christian Golding

Executive Director Perth
Melissa Alexander

Melissa Alexander

Partner Sydney
Pitcher Partners insights Get the latest Pitcher Partners updates direct to your inbox

Thank you for you interest

How can we help you?

Business or personal advice
General information
Career information
Media enquiries
Contact expert
Become a member
Specialist query
Please provide as much detail to ensure appropriate allocation of your query
Please highlight a realistic time frame that will enable us to provide advice within a suitable and timely manner. Please note given conflicting demands with our senior personnel, we will endeavour to respond to you within the nominated time frame. If you require an urgent response, please contact us via [email protected] or 03 8610 5477.
CPN Enquiry
Business Radar report
Student careers 2021-22
Find an expert
Search by industry