Hinkley received the award, which is named in honour of coaching icon Allan Jeans, after steering Port Adelaide from 14th in 2012 to a remarkable finals win this season.
Accepting the award in front of more than 600 guests at Crown on Tuesday night, Hinkley said he was honoured to join the senior coaching ranks and then be recognised in his first season.
"There was a bit of a story for me before I got the opportunity to coach, and to have that opportunity was great," he said.
"It's incredibly humbling for me, and the opportunity to coach is something I was gifted by the Port Adelaide Football Club.
"We just want to make sure we set ourselves on the path to hopefully establishing ourselves as one of the great sides of the competition."
Hinkley, who played 121 games with Geelong between 1989 and 1995, joined Mark Thompson as an assistant with the Cats in 2004 and was a key contributor to the 2007 and 2009 premierships.
At the end of the 2009 season he joined Gold Coast as an assistant coach and seemed unlikely to progress to a senior position after being overlooked for the top job at Richmond, Geelong and St Kilda.
As Port Adelaide searched for a senior coach last year, Hinkley was touted 'the last man standing' after other candidates pulled out of the race.
There is no doubt he has been the right man for the Power, however, putting the club back on the map after it battled in 2012.
Collingwood star Scott Pendlebury was named the AFLCA player of the year, finishing one vote ahead of 2013 Brownlow medallist Gary Ablett and All Australian captain Joel Selwood.
Leigh Matthews was announced as the AFLCA's fifth coaching legend, joining John Kennedy snr, Ron Barassi, Tom Hafey and David Parkin.
Matthews, who won four premierships as a coach, accepted his award from his Brisbane Lions hard men Chris and Brad Scott, who are both now senior coaches.
"I'm quite happy not to be living the lifestyle of a coach any longer, but I'll be really jealous on Saturday afternoon," he said.
"The coach and the players who win are going to experience just an unbelievable sense of exhilaration.
"At the time it is just so special."
In other awards, Greater Western Sydney star Jeremy Cameron was named the best young player, based on his first two seasons, edging Port Adelaide All Australian Chad Wingard.
Collingwood's Robert Harvey was named the assistant coach of the year, the Western Bulldogs' Chris Maple was the development coach of the year, and Geelong recruiting guru Stephen Wells received the support staff leadership award.
Experienced and highly respected assistant George Stone was acknowledged for his broad contribution with Hawthorn and the Sydney Swans with the achievement award.