When Strength Becomes Fragile: The Hidden Financial Risk Facing New Zealand Associations
The 2025 State of the Association Sector Report revealed something that should give every board pause for thought: nearly half of New Zealand’s associations could operate for only 3–12 months on their current reserves.
For a community built on continuity and trust, that’s an uncomfortable truth. Our sector has weathered economic cycles, pandemics, and political shifts — yet for many associations, one cancelled event, one lost sponsor, or one year of slow renewals could put real pressure on stability.
And this isn’t about poor management or lack of intent. Most associations run lean. They stretch every dollar to serve members, fund advocacy, and deliver events. But lean can quickly tip into fragile — especially when fixed costs rise faster than revenue.
The challenge behind the numbers
The report shows that events and sponsorship remain the dominant non-dues income sources for more than 85% of associations. When those two pillars wobble, financial resilience does too.
At the same time, member affordability pressures are rising. Many organisations froze or delayed fee increases, while venue, catering, and AV costs have jumped sharply. It’s a perfect storm that leaves little margin for error.
So what can association leaders do?
Financial fragility isn’t inevitable. It’s a signal — one that calls for sharper strategy, stronger collaboration, and better use of the collective intelligence in our sector. Here are five actions every board and executive team can take now:
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Re-set the reserve policy
Move beyond “a year of cover” as an arbitrary benchmark. Align reserves to your actual risk profile — consider what a major disruption to your main event or membership income would cost and build policy from there.
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Diversify your non-dues revenue
Don’t rely solely on the annual conference. Associations that build small but steady income from online learning, supplier partnerships, or credentialling programmes are better protected when sponsorship fluctuates.
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Model financial scenarios annually
Use simple sensitivity testing: What if membership dropped 10%? What if event income fell by a quarter? Present those to the board each year so strategic choices are made with eyes wide open.
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Invest in value before price
Fee increases are easier to justify when members see tangible benefit. Strengthen perceived value through professional development, sector-specific resources, and peer connection — then communicate those wins clearly.
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Collaborate, don’t compete
Shared services, co-hosted events, or joint purchasing between associations can reduce cost and increase reach. The sector’s collective strength is one of its greatest untapped financial assets.
Turning resilience into confidence
None of this is about panic — it’s about preparation. Associations are, by nature, built for the long haul. But long-term impact depends on short-term security.
If your board hasn’t reviewed its reserves or revenue diversity recently, now is the time. Start the conversation, run the scenarios, and treat financial sustainability as the strategic priority it truly is.
Together, we can ensure our associations remain not just resilient — but confident, adaptive, and ready for whatever comes next.
By Brett Jeffery, CAE — Executive Director, NZSAE
3 November 2025
