The Legal and Regulatory Environment of the Third Sector

Abstract

The third sector, comprising a vast array of organisations that are neither part of government nor formed primarily to generate a profit for owners, is an important part of a well-functioning society. Governments can assist the development of a strong and sustainable third sector by ensuring there is a supportive legal and regulatory environment This article suggests ways in which well-framed laws and regulations can help the third sector. Then, drawing on Australian examples, it goes on to indicate how a badly managed legal and regulatory environment can damage the third sector. It concludes that even if the legal environment is supportive, it will be ineffective if the wider policy environment is hostile toward the third sector. A lesson for third sector organisations is that they must work together to ensure a favourable legal, regulatory and policy environment.