Nonprofit Board Crisis

Nonprofit Operates And Is Family Business

The Nonprofit Professionals Forum recently reported about in-house accountants at Feed the Children being fired more-or-less after reporting to the board on a humongous tax issue and the accountants in turn suing the organization.  I would imagine that the accountants could have an excellent whistle-blowing case, which is one of those Sarbanes-Oxley provisions.

BUT, the way more interesting item this story introduced to me was all the activity that is going on at Feed the Children.  I mean, talk about an organization not having a good day!  There's a huge list of issues filling the local Oklahoman.  Bottom line, if there's an organization needing an intervention at just about every level, it's Feed the Children.  Why?  There are founder issues, governance issues, founder-governance issues, personnel issues and even criminal issues like burglary and wiretapping.

Now, are all these troubles because Feed the Children operates like and is essentially a family business?  I'm thinking the answer is yes, and as a result, can only conclude (and fundamentally believe) that If a nonprofit is run like a family business (not to say there aren't family businesses that are run just fine and perhaps better than some nonprofits) it's bound to experience troubles. 

Freedom of Religion to Preserve Freedom of Press

In an interesting twist of fate, a financially failing Philadelphia church made a "$100,000 loan to fund the resuscitation of newspapers".  The loan went to a Germantown businessman to publish two new weeklies.

For sure, I think it was smart of the businessman to get financing from a church.  Certainly says something about the market though.  And, I sure hope that the church knew what business plan questions to ask and did it's due dilligence to ensure that its money will eventually be returned.  Perhaps equally interesting was the belief by the church's parishoners that financing local newspapers was a fit with mission.  I'm not saying it's not, but......

Nonprofit Co-Chairs Announce They Are Departing

I read a front page article in my local paper today that talked about the announcement by an area nonprofit's co-chairs that after 12 years (spending much of that time raising money) they were pooped and needed to resign.  The group is a Habitat affiliate, and the article was titled: Will this be the organization's last house?

So, how do you think the organization's governance is going?  The organization may shut down because there's no one who has come forward saying they are willing to lead.  So, while the board members dutifully paid attention to operations and fundraising (after all, that IS the business of the mission), they did not pay attention to one core organization sustainability issue: succession planning and in particular, readying the next leaders to be leaders.

Unusual? I think not.  A serious problem?  The evidence is clear. 

Nonprofit Board Member's Contract

Kudos to Jan Masaoka for a nice job sharing a Nonprofit Board Member's Contract in her Blue Avocado e-newsletter.  Blue Avocado is an easy but tofuy (I don't eat meat) newsletter, well worth a moment to glance through.  The contract can be found here.

Thanks Jan!

Nonprofit Museums: A Good Investment of Stimulus Monies?

Are nonprofit museums a good investment of Stimulus Monies?  That's the question presented in the LA Times noting that some legislators are seriously questioning such investments.

But after reviewing the article I'm not getting the issue.  Stimulus funds are supposed to provide a direct, secondary and possibly tertiary economic benefit to a community.  At least from the examples in the article, museums sure accomplish these objectives.  And, maybe, even better than some of the public projects.  Museums are, after all, run by citizens, mission-centered and focused on maximizing each dollar invested (maybe way better than the public sector).

So, what was the question?

Supporting Nonprofits: How Much Does the Motive Matter?

I'm neither pro or con Mayor Bloomberg of New York City but I was so struck by the allegations of his challenger for the office that I had to say something.

His challenger, City Comptroller William Thompson Jr. has "accused Bloomberg, who's a philanthropist and the richest person in the city, of buying off New Yorkers by donating hundreds of millions of dollars to organizations that later back his policies. He said Bloomberg is spending an "obscene" amount of money on his campaign."

And this is the biggest "attack" Mr. Thompson can lob?  Mr. Bloomberg is giving away too much money?

First, a reminder: the only thing wrong with tainted money is there 'taint enough of it.  Now, Mr. Bloomberg has it and is giving it and I believe if the gift happens to also benefit his campaign, first, prove it and second, so what?  In these days, all philanthropic support is welcome and valued, no matter the motive.  And really, all these voters are going to vote for Mr. Bloomberg because he supported nonprofits?  Really?  Politics is certainly sinking to new levels.....

For one article on the story, see the Linkedin Nonprofit Professionals Group.

Nonprofits Go Without Money and, no plan

When asked the question: "what's in your wallet", a lot of social service organizations throughout the country are saying, "not much".

States are out of money or at least delaying their budgets for lengths of time that have their own repurcussions on social service agencies.  Take for instance, Pennsylvania which didn't approve its budget for three months after it was due.  (See consequences for social services article in Philadelphia Inquirer.)

This is a situation which is likely to repeat itself over the next couple of years.  In the ideal world, folks have implemented the plan they made maybe last year or the year before.  Practically, maybe not.  And that's the question.  What exactly should these agencies be doing?  Is it time to make a plan or too late?  And, is the best plan to look at some partnerships or mergers for cost savings that can make providing services more feasible?

So many questions, and too few answers.  Anyone want to chat about this?

Nonprofit Brought Us the CRA

Who has learned that so much trouble can come from mismanagement and "poor" governance? 

The answer: ACORN.  Yes, its troubles have only escalated as just about everyone in the funding and legislative world has jumped on the Anti-ACORN bandwagon.

But now it's time for the nonprofit sector to say enough is enough.  No, I don't think folks should be out there with a "SAVE ACORN" banner but this bashing of ACORN is now turning into a cause against one of the really essential platforms ACORN championed: the Community Reinvestment Act (CRA).  CRA was designed to end red-lining - a practice of "walling off" the inner city neighborhoods from mortgage loans.  In time, the Act also served to make banks more socially responsible. 

Some in congress are using the ACORN problem as a rallying cry to say it's time to stop the CRA.  Over time, ACORN has been a beneficiary of the Act as banks supported ACORN to provide advice to first time homeowners (a pretty valuable service I believe) among other types of services that helped inner city neighborhoods develop and prosper.

Like in the public sector and private sector, mistakes (putting it nicely) can be made by individual nonprofits (uh, it's basically the focus of this blog).  But, when those failings become a rallying cry to turn against the parts of society that have limited voice, it's time for the nonprofit sector to take a stand. Talk about throwing the baby out with the bathwater....the Community Reinvestment Act, that's a baby I'll keep.

For the latest on the ACORN/CRA story see the San Francisco Chronicle.

was intended to end redlining, a practice in which banks in effect walled off inner-city neighborhoods from mortgage loans

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/10/13/MNQ31A4LIM.DTL#ixzz0Toq5kbTP

Nonprofit Board Memberships: How Many Is Too Many?

Just how many nonprofit boards can an individual be a member of and be really effective - I mean, really effective, fully fulfilling the duties of care and doing all the other "stuff" that makes for a great board member?

This is the question that arose in my mind from a Washington Post story about a really impressive guy who, along with the many alcolades listed about him, is the line: "He sits on the boards of more than a dozen nonprofit organizations".

Now the gentleman in question is retired, actually, a senior citizen who is very much present and committed from what I can tell.  And maybe all the nonprofits where this gentleman serves are not all demanding in the way many nonprofits are.

So, what do you think?  Just how many nonprofit boards can one person serve at the same time, effectively?

Nonprofit Revenue Generating Venture

My hat is off to Oakland, CA-based Bay Area Community Services (BACS) and its TOTALLY mission-aligned revenue generating venture "Meals for Change".  BACS provides farm-to-table nutritional support for the elderly and culinary training to the disadvantaged.

Meals for Change is a new line of microwaveable vegan and vegetarian meals for two.  The product is available in area stores or by delivery.  And, to top it off, proceeds will be shared with area nonprofits while also benefiting area farms and the folks who learn cooking through the organization's training program.

Assuming folks have figured out the economics correctly, this is one of those win, win, win ventures that is what social enterprise is all about! 

To learn more see the article in the San Francisco Chronicle.

Now in markets are a new line of microwaveable vegetarian and vegan entees from a Bay Area community non-profit. The meals, each serving two and ready in just two minutes, come in six varieties, including some designated wheat-free, dairy-free and low fat. Ingredients - which contain no GMOs and are often organic - come from local family farms.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/10/11/FDUQ1A1V9L.DTL#ixzz0Tj2xkQSC

include providing farm-to-table nutritional support for the elderly and culinary training to the disadvantaged

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/10/11/FDUQ1A1V9L.DTL#ixzz0Tj2W4BYY

Non-profit, Oakland-based Bay Area Community Services (BACS) developed Meals for Change to fund its programs, which include providing farm-to-table nutritional support for the elderly and culinary training to the disadvantaged.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/10/11/FDUQ1A1V9L.DTL#ixzz0Tj1ySGLx