By Sarah Markley, Deputy Secretary-General of PASAI and Director, International Engagement, Office of the Auditor-General of New Zealand
Strong institutions do not stand still. They evolve to remain credible, compliant and relevant.
The recent update to the PASAI Charter is a clear example of how PASAI is responding to change in a way that reflects the values of supreme audit institutions (SAIs): integrity, accountability and leading by example.
In New Zealand, the Incorporated Societies Act 2022 replaced legislation that had been in place since 1908. The new Act sets clearer and higher standards for governance, accountability and transparency. It strengthens expectations around how organisations are governed, how decisions are made and how officers meet their legal duties.
For New Zealand-registered organisations like PASAI, this was not simply a technical or administrative update. The new legislation required incorporated societies to reassess their foundational documents and ensure they clearly set out governance responsibilities, member rights and compliance obligations. In short, the law asks organisations to be much clearer about how they govern themselves and to demonstrate that this governance works in practice.
Why PASAI had to update its Charter
As an incorporated society, PASAI was required to align its Charter with the new legislative framework if it wished to re‑register and continue operating. This wasn’t difficult. PASAI was formed in 2009 under the 1908 legislation, but it established its Charter in alignment with best practice governance arrangements at the time. This meant that PASAI was not only aligned with the existing legislation, but far above the minimum requirements.
However, the decision to update the Charter was about more than just following the law.
PASAI supports SAIs across the Pacific to strengthen public sector accountability. To do this credibly, PASAI must model the principles it promotes. Updating the Charter was an opportunity to reinforce good governance and demonstrate that compliance is not optional.
Regardless of the need for minimal change to comply with the new legislation, the re-registration process was not taken lightly. Papers were presented to 6 consecutive quarterly Governing Board meetings over 18 months. A survey was conducted to collect views from the region. A special sub-committee met for more than 10 hours to consider survey feedback. Multiple sub-regional and topic-related meetings were held, and relevant specialist advisors were engaged throughout the process.
All of that process might sound excessive for a small organisation, but it was approached with intention and commitment proportionate to the importance of PASAI demonstrating good governance. It was an opportunity to use an inclusive and consultative process to stress test the existing arrangements while addressing the required changes. While consultation resulted in little fundamental change to the Charter, it enabled smaller issues to be surfaced and solutions to be identified and cemented into operational processes through changes to the Governance Code. The updated Charter, Governance Code, related policies and process brought in clearer governance settings, updated provisions for officers’ duties and addressed areas of concerns that previously lacked clarity.
Completing the changes within the legislative timeframe enables PASAI to continue to operate effectively, hold contracts, manage funds responsibly and employ people with confidence.
Leading by example: why this matters for SAIs
SAIs are trusted institutions. Their authority depends not just on mandate, but on behaviour. When SAIs scrutinise other public entities, they must be able to point to themselves and to PASAI as models of good practice.
The Charter update reinforces a simple but powerful message: compliance starts at home. Legislative change may start at the top, but its impacts are felt throughout an organisation. Clear governance documents shape decision‑making at board level, guide management practices and influence organisational culture. By responding proactively to legislative change, PASAI demonstrates how compliance can be approached as an enabler; providing clarity and strengthening institutional resilience.
Strengthening and empowering the PASAI Governing Board
A significant aspect of the updated Charter is the introduction of clearer and stronger board member requirements. These changes recognise that effective governance depends on well‑informed, accountable officers who understand their strategic role and their legal duties. Rather than constraining the Governing Board, the updated Charter empowers it. Clear responsibilities, protections (including provisions on appropriate and proportional insurance protections for officers) and governance expectations enable board members to act with confidence and integrity. Strong governance frameworks create safer decision‑making environments and encourage thoughtful leadership grounded in accountability.
Next steps
Updating the Charter was a critical milestone, but it is not the end of the journey. PASAI continues to work on operationalising the Charter updates so that governance practices, policies, systems and induction processes fully reflect the new requirements. This ongoing work underscores an important lesson for SAIs and their partners: compliance is not a one‑off exercise. It is an organisational commitment that requires time, attention and continuous improvement.
The PASAI Charter update highlights how legislative change can be a catalyst for strengthening institutions. By acting early, engaging in a consultative and inclusive change process and embedding compliance into its core documents, PASAI reinforces its role as a regional leader. For SAIs, the message is clear: good governance is visible, deliberate and lived at every level of the organisation. Leading by example is not just expected – it is essential.
