The legally binding altruism at the core of the USU

The USU is legally defined as a charity and it’s important its directors don’t forget that.

USU justice

At the end of last semester, most of us were getting ready to enjoy the sweet relief of the winter break. Meanwhile, the University of Sydney Union, our ever-present campus pizza and meat box vendor, was getting ready to release its 2017-2020 Strategic Plan.

A glance at the Strategic Plan highlights its major problem — many of the USU’s major strategic goals, especially its overarching commitment to financial and organisational “growth”, are indistinguishable from those of a for-profit enterprise.

According to the plan, the USU is aiming to grow financially by “developing internal and external income streams” and pursuing new “commercial opportunities”. The Union was clearly not put off big business in June when a representative of Tsingtao, a Chinese alcohol company that has partnered with the USU, started a flame war with students online. The USU wants to “monitor external trends” to “ensure revenue growth”, even as successive USU Board candidates campaign on cheaper ACCESS cards, food and the like, all of which would undercut the USU’s desire for “revenue growth”. Over the next four years, the USU is also seeking to build its financial reserves and improve its ability to pursue large projects.

Granted, the Strategic Plan does place some emphasis on the USU’s “not-for-profit” nature and desire to improve the “campus experience”, including for marginalised communities, but these objectives pale in significance when juxtaposed with its primary focus on corporate expansion.

This clash between divergent aspects of the USU’s identity is nothing new — it featured in the 2017 election for the USU’s Board of Directors. Whilst campaigning, candidate Caitlin McMenamin repeatedly promised to be a “left-wing voice on Board”, possibly equating the “Union” in the USU was equivalent to the “U” in the National Tertiary Education Union (NTEU). Meanwhile, Jacob Masina pitched himself as an “efficient” manager of what he believed to be “essentially a corporate entity”, even though the USU is an unincorporated association — in other words, not a corporate entity. Masina was elected, McMenamin was not.

Here’s the thing: the USU is neither a trade union nor a corporation — it’s a federally registered charity, governed by the Australian Charities and Not-for-profits Commission (ACNC) Act 2012.

The ACNC Act specifies that the USU must meet the description of the word “charity” if it wishes to be registered with the ACNC. The legal description of the word “charity” is found in the Charities Act 2013, which somewhat unhelpfully describes it as an organisation with “charitable purposes”.

The USU has not made clear its “charity subtype”, which is the ACNC’s way of indicating a charity’s “charitable purpose”. Legal cases that have examined the definition of “charity”, including one situation where the Australian National University Union tried in vain to claim that it was a “benevolent” organisation, suggest that the most appropriate “charitable purpose” of those found in the Charities Act is “the purpose of advancing education”.

This should have significant implications for how the USU is run.

With a purpose of “advancing education”, the USU must not be run like a for-profit business, and should not foster a public perception that its goals and activities are similar to those of a for-profit business or a trade union. Whilst the maintenance of sustainable revenue and principled values are understandably important to the USU, its core activities must remain focused on its charitable purpose.

The USU shouldn’t worry about rejecting unseemly commercial deals when some of the deals that are struck end up frustrating and annoying students. It shouldn’t navel gaze on revenue streams when campus events, especially late-night affairs, are inaccessible for many students, whether due to time, cost, or distance. Its Board of Directors shouldn’t forget that they have been entrusted with the educational experience of sixty thousand university students, and should be prepared to shoulder that responsibility.

The USU must focus on one thing and one thing only: ensuring that USyd students from all backgrounds can have the best possible time at university.

That’d be the charitable thing to do, after all.

Vice Chancellor Michael Spence.

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