Incorporated Societies Act 2022: Key Changes You Need to Know

You may have heard mention of it in the media, through posts we have made online, or even within the incorporated society you are part of. Change is here, and it is the most substantial change for the way incorporated societies operate in New Zealand in over 115 years.

It is best advised to start becoming familiar with these changes earlier rather than later and importantly, do not leave it too late to update your incorporated society. Or even worse, forget to update it entirely!

The previous Act governing incorporated societies was in place from 1908. At that time it was innovative - yet it was also put in place prior to the Titanic, so as you can appreciate, the world and the legislation requirements that go alongside have changed quite significantly since. 

These changes to legislation for incorporated societies are well and truly overdue!

What are the changes, what does our incorporated society need to do, and by when?

In summary, the changes have been introduced to create stronger and more approachable governance frameworks for incorporated societies. The new act also provides more clarity on duties, standards and requirements for those that are responsible for running them. 

There are currently over 24,000+ incorporated societies in New Zealand, with all incorporated societies being impacted by these changes. We have outlined the key steps below for what each incorporated society needs to do, in addition to the timeframe this is required to be completed by. 

What is key to note here, is that your incorporated society must re-register with the new changes applied by no later than April 2026.

Timeline for Incorporated Societies Act 2022 changes

What are the key changes our Incorporated Society needs to know?

1. Incorporated societies will need to have at least 10 consenting members
   
   This is 5 less than the 15 required under the original act. However, it is important to note that it is not just 10 members at the time of registration; if you ever drop below 10, you run the risk of deregistration or liquidation.
   In addition, all members must be giving their consent. This means it is not possible (or advisable) to sneak any members in without their prior knowledge.
   
   
2. Every society must have a committee of at least three members to manage the society
   
   The restrictions on who can serve as an officer are similar to those for company directors. Individuals cannot be officers if they are undischarged bankrupts, barred from being a director or promoter of a company, or have been convicted and sentenced for offenses such as crimes involving dishonesty.
   
   
3. These officers will also need to operate with a fiduciary duty to the society
   
   Another similarity with company directors. The duties of officers include things like exercising powers for proper purposes, acting in good faith and in the best interests of the society, and not acting in such a way that there will be a risk of serious loss to creditors.
   
   
4. All officers will need to identify and disclose if they have any conflicts of interest
   
   These may be such items as having a personal interest in a matter that relates to the incorporated society.
   
   

What other things do you need to be aware of?

Incorporated society members will be given greater rights and responsibilities than prior. One of the key principles is that “members of a society have the primary responsibility of holding the society to account”. This essentially means members are given certain rights and powers such as those outlined below. 

1. Any member can request information from the society
   
   The incorporated society must produce this on request, except if it falls under one of the grounds of refusing such a request. For example, if doing so would violate an individual’s privacy.
   
   
2. There will be clearer rules around amending an incorporated society’s constitution
   
   This also considers the need for members to approve it.
   
   
3. There are guidelines for dispute resolution that must be adhered to
   
   The courts may also intervene in such cases - such as, if there has been a breach of the rules of natural justice.
   
   
4. Incorporated societies will have greater financial reporting obligations
   

• The minimum requirements for “small societies” are set out in the Act. A small society is one with total operating payments less than $50,000 in each of the two preceding financial years, and total current assets less than $50,000 at the end of those two preceding financial years.
  
• Other societies will need to meet standards set out by the External Reporting Board.
  
• Some societies, whose annual operating payments exceed a certain threshold, will need their accounts audited. This threshold will be defined in regulations being developed by MBIE.
  
  

So, what areas should your incorporated society prioritise first?

• Ensure you have officers that fit the new criteria
• Develop or update dispute resolution processes
• Start updating your constitution.
• Consult the services of a legal firm to review your updated structure, constitution, officer roles and obligations and dispute resolution.
  

The Canterbury Legal team can help you understand what you might need to do to meet the new Act’s requirements, and start a plan to get there.


Get in touch for an obligation free chat

Frequently asked questions

1. If I have until April 2026, isn’t this plenty of time to organise?

While it may not feel like an initial priority for many incorporated societies. The reality is that these changes can only be adopted during an AGM. This means that depending on when your incorporated society last had its AGM, you may only have only one or even two AGM’s left to have this completed by!

The reality is that there are still many New Zealand incorporated societies that are still yet to fulfill the requirements of this new legislation. This is likely to lead to a substantial bottleneck as everyone looks to adopt these new requirements before time runs out.

2. What happens if I do not do this in time?

Unfortunately if you do not complete the requirements within the timeframe, you will be struck off the register as an incorporated society. This would of course be far from desirable if you need to continue operating as an incorporated society.

3. Do I have to re-register my incorporated society with new legislation?

Not necessarily! If you have decided that an incorporated society is no longer the correct definition, or things have changed for your structure, you can look at adopting a different structure such as a charity.