Financial resilience is becoming a bigger conversation for associations.

Membership, events and sponsorship remain important sources of revenue, but they may not be enough on their own to build a sustainable organisation for the long term. At the same time, associations are navigating changing member expectations, rising costs, economic uncertainty and increasing competition for members’ time and attention.

So, what does financial resilience look like in practice?

At a recent AuSAE AKP: In Practice session, three association leaders Amelia Hodge, (Energy and Resources Law Association), Graeme Janes (Christian Venues Association) and Dr Tim Boyle (LifeSciences Australia) shared very different experiences of tackling financial sustainability, from launching new insurance models to rebuilding an association's revenue base from the ground up. The session was facilitated by Deanna Varga from Mayvin Global.

While their approaches were different, a few common themes emerged: understand the problem you're trying to solve, know your members, be prepared to challenge the status quo and don't underestimate the importance of trust.

Start with the problem, not the product

For Amelia Hodge, Executive Director at Energy and Resources Law Association, the starting point wasn't simply finding another source of revenue. It was identifying a problem, members were facing.

At the Australian Property Institute, Amelia saw a professional indemnity insurance market where premiums were escalating, and exclusions were increasing for valuers.

Rather than accepting the status quo, the organisation explored whether it could create a different commercial offering for members.

“We looked at a problem, and what was the problem we were trying to solve?”

That led to the development of PropSec, a risk-sharing insurance arrangement involving the Australian Property Institute, Howden Group and three insurers.

It was a complex, multi-year undertaking, but it also created an unexpected benefit: competition.

As other insurers responded to the new offering, some reduced premiums and changed exclusion clauses.

For Amelia, that became an important measure of success.

“That competition really proved a benefit for those members that he insures.”

The lesson for associations is that diversification doesn't necessarily have to start with the question, What can we sell?

It can start with a much more useful question: What problem are our members trying to solve, and are we uniquely placed to help?

Financial resilience can take time

Graham Janes, CEO from Christian Venues Association, shared another example of an association responding to a member pain point.

The association launched a discretionary mutual fund to provide an alternative approach to property and liability protection for members.

It was not a quick or low-risk decision.

The board identified three key risks before giving the initiative the green light:

• The significant financial and time commitment required.
• The potential impact on existing insurance relationships and revenue.
• The risk of not doing anything while members faced increasing insurance costs and uncertainty.

That third question proved particularly important.

“What is the risk if we don't do it?”

For associations, it's easy to focus heavily on the risk of taking action. But Graham's experience highlights the importance of considering the risk of standing still too.

The financial return from the mutual fund is expected to take time. The association didn't pursue it simply as a quick revenue opportunity.

“We didn't do it just for the cash. We did it to keep the membership going.”

That distinction is important.

Financial resilience isn't necessarily about finding the next revenue stream that immediately boosts the bottom line. Sometimes it's about investing in something that strengthens the member proposition, protects the sector and creates a more sustainable position over the longer term.

Don't underestimate the cost of change

Both Amelia and Graham were candid about the amount of work involved in developing new commercial models.

Legal structures, governance, risk management, board education, member consultation and relationships with external partners all took significant time.

Graham's advice was particularly clear: “You need a clear desk. If your desk is full and you have no capacity, it won't happen.”

For association leaders considering a significant diversification project, that's an important practical consideration.

A new revenue stream doesn't simply sit alongside business as usual. It can require substantial leadership attention and organisational capacity.

Before starting, consider: Do we actually have the capacity to do this properly?

If not, what needs to change first?

Sometimes financial resilience means rebuilding the whole model

Tim Boyle, CEO of Life Sciences Australia, shared perhaps the most fundamental transformation of the three.

When Tim joined the organisation, it had become heavily reliant on government grant funding. In FY23, grants accounted for around 35% of the organisation's budget.

When that funding ended, the association was left with a significant budget gap.

There were other warning signs too. The membership database didn't accurately reflect current members, and the organisation discovered that it had far fewer financial members than previously reported.

The situation created an opportunity to rethink the entire operating model.

“We've got an opportunity now to tip the bucket upside down, sift through the good parts, and rebuild the association.”

The organisation introduced new revenue lines including corporate partnerships, events, chartered membership and certification, while also undertaking a rebrand and changes to governance and operating processes.

It also significantly reduced its reliance on membership dues as its primary revenue source.

The result was a much more diversified model, alongside substantial membership growth.

Tim's experience highlights an important point: financial resilience isn't always about adding something new to an existing model.

Sometimes the existing model needs to be fundamentally reconsidered.

Know your members. Really know them.

Across all three case studies, one theme kept coming back: member understanding.

Amelia's advice was simple: “Understand your data and understand your members.”

But understanding members means more than knowing how many people are in your database.

It means understanding their businesses, pressures, priorities and pain points.

Amelia described travelling extensively and speaking directly with members throughout the development of PropSec.

Graham similarly emphasised getting out and talking to members rather than making decisions from behind a desk.

“You've got to be out there talking to them and seeing what their pain points are. You can't manage an association purely from an office.”

That member intelligence can reveal opportunities that aren't obvious from financial reports alone.

It can also help associations test whether a proposed product, service or commercial model is genuinely valuable.

Consultation builds confidence

For complex or potentially disruptive initiatives, consultation also plays an important role in bringing boards and members along the journey.

Amelia's experience included extensive education of the board, as well as establishing governance structures with independent expertise.

Tim described creating advisory groups and colleges representing different occupational areas, giving members a structured way to contribute to education, professional standards and other areas of the organisation.

These structures do more than collect feedback.

They can help boards understand the risks, give members a voice and create greater confidence around significant decisions.

As Deanna Varga, who facilitated the discussion, highlighted: “Consultation is critical.”

Don't overlook the risk of doing nothing

One of the strongest themes from the discussion was that inaction carries risk too.

For Graham, the board explicitly considered what would happen if the association didn't pursue a new approach to insurance.

For Tim, the organisation's existing model was already becoming unsustainable.

And for Amelia, changing market conditions meant members could potentially be left without affordable professional indemnity insurance.

The question isn't simply: What could go wrong if we change?

It's also: What could happen if we don't?

That shift in thinking can help boards have more productive conversations about risk and opportunity.

Trust determines how ambitious you can be

Graham offered another important consideration for associations contemplating significant change: trust.

“There's an equation on how ambitious you can be with your dreams.”

The deeper the trust between an association and its members, the more ambitious the organisation may be able to be with new ideas and new approaches.

That trust isn't created when you launch a new product. It's built over time through relevance, transparency, communication and consistently delivering value.

For an association asking members to try something fundamentally different, that relationship becomes particularly important.

Five takeaways for association leaders

The discussion offered plenty of practical ideas, but five stand out.

1. Start with member problems

Don't begin with What can we sell? Start with What problem are our members experiencing?

2. Look beyond immediate financial returns

A successful diversification initiative may improve competition, reduce member costs, strengthen retention or create future opportunities before it delivers a significant financial return.

3. Understand your numbers

Know where your revenue comes from, how dependent you are on individual revenue streams and whether your reserves and operating cash position give you room to act.

4. Build consultation into the process

Bring members, boards, advisers and other stakeholders into the journey. Complex decisions are easier to navigate when people understand the problem, the evidence and the proposed solution.

5. Keep adapting

Tim's final advice was perhaps the simplest: “Never stop changing.”

For associations, financial resilience isn't a one-off project. Member expectations, technology, regulation, the economy and the competitive landscape will continue to change.

The organisations that remain relevant will need to keep asking whether their current model is still meeting the needs of the people and sectors they exist to serve.

As Tim put it: “Everything that goes external needs to create value for your members. Every dollar you spend needs to be investment for your members.”

That may be the most useful definition of financial resilience: not simply having more revenue, but building an organisation that continues to create value, adapt to change and remain relevant to its members for the long term.

If you’re an AuSAE member, you can rewatch the AKP: In Practice: Building Your Financial Resilience webinar by visiting the AuSAE on-demand library here: ausae.org.au/on-demand

To get access to the on-demand library, become a member or digital subscriber here.