Nonprofit Board Crisis

Nonprofit Board Can Matter as Much as Management

The President/CEO of the Central Park Conservancy had published in the New York Times Opinion Page a piece focused on how steady growth in donations and volunteers and creative management and time has enabled the Central Park Conservancy to grow, prosper and be successful.  The article notes that other groups no where near as established as the Conservancy should understand that they too can use the learnings from the Conservancy to arrive at the same place.

I concur and would offer that the one ingredient not cited was the Conservancy's Board.  The Conservancy's has attracted some very powerful and active board members who I would offer have played a significant role in bringing the Conservancy to its present place in the world.  Yes, to fundraising and volunteerism and management but equally important, a board that cares, is involved and gives.

Nonprofit Board Fires Founder/Director

Just because it's so rarely this public I have to give kudos to the Pittsburgh Irish & Classical Theatre Board for taking the action and firing its founder/Director. 

I unfortunately don't have enough information to better understand more fully what led to this action.  From the Pittsburgh Gazette I understand that the now ex-director made a change in his presence at the Theatre.  Once serving full-time, the Director over the last year switched to being spending only six months in Pittsburgh.  I certainly don't know the so-what to being a part-time director of a full-time theatre but I would imagine that the demands would be greater.

That said the Gazette article suggests that the communications between the board and founder may not have been stellar.  And there has not been a contract, ever.  And, the Director is suggesting he may have some legal grounds for getting a bigger financial settlement for the dismissal.

Everything copacetic between the two?  I'm not thinking so.  Do both parties bear some responsibility?  Likely.  What's the first step?  Communications and not after the fact.

Nonprofit Scammer of the Week

According to Philly.com a New Jersey resident

admitted that while working as director of operations at a warehouse for the nonprofit Clothes For Kids Inc., he billed the organization for wages for employees who either had left the organization or had never worked there.

The U.S. Attorney's Office says Smith manually changed direct-deposit information for seven employees who had left the company so that their wages would be deposited into his accounts. They say the scam defrauded Clothes For Kids of more than $101,000.

So, who discovered this problem in the first place: auditors, executive director, finance committee?  And has part of the follow-up been to examine the systems and policies that affect internal checks-and-balances to ensure this can't happen in the future?  And besides the person found to be culpable for the crime, is there anyone else in the organization responsible? 

Nonprofit boards and executives -- this case is a good heads-up.

 

 

Nonprofit Without Governance

The Washington Post story about a nonprofit facing multidtudinous challenges with its finances and financial reporting leaves me with one unanswered question: where is this organization's board?  While a nonprofit is certainly accountabile to a number of regulators and donors, accountability and avoidance of the issues this nonprofit is facing begins with a responsible board of directors. 

Nonprofit Raises $1 Billion In 1 Year

The recently released Council for Aid to Education survey has identified that for the first time ever, a University, Stanford, has raised more that $1 billion in a single-year period. 

Most articles I reviewed about this report observe that the amount raised is good news for colleges given what has been bad economic times.  Some also observe that while the news is great, it's only great for the "haves" versus the way-less connected colleges who aren't in the top 10 which collected 17% of all the money. 

The one story I didn't hear was the role of trustees in this successful fundraising.  We of course hear the message all the time that nonprofits that succeed in raising money do so because trustees get involved.  I wonder how much that is true for the institutions that were the big winners in college fundraising.  I for one would certainly welcome the Council's telling more on this part of the story now that we know (and probably knew all along) that the money for causes hasn't gone away -- it just hasn't been tapped.

Nonprofit Approaching Milestone

The Christian Science Monitor is reporting that Sesame Street is approaching a rare milestone: 1 Billion Youtube viewers.

Hoorary for Sesame Street!  I guess.  But to be honest, I don't think I understand the "so-what" of this achievement.  The Monitor says it's a big deal and particularly so for a nonprofit.  The Monitor says that part of the so-what is that this achievement reflects a new trend toward the "multimedia nature of kids entertainment". 

Really?  So what's the strategy?  Get more play "eyes" so to speak and get closer to achieving mission and in turn, appeal to more sponsors which in turn means more money to do more mission?  And what exactly did Sesame Street do to achieve this milestone?  Knowing this "secret" -- that would be a lesson that could benefit the whole nonprofit sector.

 

Nonprofit Board Presidents

It's President's Day in the US so it feels right to take a moment and reflect on nonprofit board presidents.

Early last year 192 folks responded to my invitation to participate in a survey titled "Do Titles Matter".   My interest in titles was stimulated by a paper that was presented at the University of Kansas Missouri bi-annual conference on nonprofit governance.  The paper was focused on identifying an understanding of the work of Board Chairs versus Executives.  One item that caught my attention in the paper was the relative interchangeable use of the term president when referring to the volunteer and paid leaders of a nonprofit. 

My survey revealed that 43% of respondents used the title of President to refer to their volunteer (board) leader while 38% used the title of Chair.  The remaining respondents used the term chairman or chairperson title.  Interestingly, another 9% used the title President and another 9% used the title President/CEO for their paid leader.

So what is the "so what" of titles like Chair and President?  To me it's about expectations.  Individuals who hold the title "president", be they the paid or volunteer leader of an organization or even a country, expect to have a set of specific rights and obligations.  For instance, people with the title of president often expect to have authority over a number of decision-making areas.  When the president is the equivalent of a board chair, expected authority may not be as wide as if the same titled person was the CEO.  Whereas many don't really consider Board Chair and Authority as synonomous.

A more important bottom line: titles in and of themselves do not matter all that much but gaining clarity about rights and obligations, particularly of those in leadership positions, really does matter. 

I believe that Boards would be well advised to annually review the lables being used to designate the position of the top paid and unpaid leaders of the organization.  Part of this label review should focus on ensuring that rights and obligations are quantified and qualified to subsequently achieve positive outcomes.

Happy President's Day!

 

Nonprofit Leader Fired and Reassigned

An LA Times article about a First African Methodist Episcopal Church pastor (who according to the article has committed a substantive number of illegitimate and possibly illegal actions) has me wondering what it is about faith-centered (church) hierarchies that makes it so difficult to both recruit, select, monitor and retain "fully honest and loyal" employees.

Of course, I am not singularly thinking about the leader profiled in this specific article, but rather I am thinking about pastors from a number of denominations throughout the country and the world.  I acknowledge that faith-centered nonprofits are not the only place where these challenges occur.  But there are differences between faith-centered and non-faith centered organizations that may help explain why faith-centered organizations may experience these travails more often. 

For sure, where boards are comprised of volunteers, with authority, there is the possibility that oversight of the overseers is deeper and wider both in knowledge and experience ensuring sound policy and evaluation.  Also, in faith-centered nonprofits, it is not uncommon that what rises those with authority over pastors is not their management, planning and evaluation strengths but their example as individuals who have lived their faith and loyalty really well.  And, training in human resource management or development is not noramally required from or provided to those who serve.

But the one area that is more of a puzzlement and challenge that doesn't explain the susceptibility of faith-centered organizations to incidences of pastors gone awry, is what moves all these folks to their positions in the first place: core values.  Like the Scouts or Colleges, and certainly even more so with faith-centered groups, my expectations is that members will hold their leaders accountable to the group's core values and personal standards of integrity, which should keep pastors from running amok. 

And yet.....

Nonprofit Self-Selected Boards

In my experience, most nonprofit boards practice a self-selection principle toward filling their board seats.  There is much to be said in favor of the self-selection principle (who better to identify prospects who will carry-on mission with similar passion; tapping into one's own network for new members is less exhausting than trying to recruit unknowns).  Of course there is just as much to be said against the self-selected board as well.  But rather than arguing the pluses and minuses of self-selected boards, I want to highlight a New York Times article focused on the future of Family Foundations. 

This NY Times article centered around the dilemmas or opportunities facing community foundations as generations of the elders pass-on.  In addition to the aha's introduced in this article, steps about planning and training were also examined.  I believe these steps are useful and applicable to many nonprofits as they too should be strategic about filling board seats in the years ahead.

Nonprofit Values Matter and Can Guide Internal Management

One of my first tasks in working with a board developing its strategic plan is to discuss values as a part of mission and purpose.  I firmly believe that values play an important role in providing guidance to program, management & operations, sustainability and governance decisions.

One illustration of where a nonprofit's values are put into action is the World Wildlife Fund's "Panda Fridays" when the organization closes its operations every other Friday to reduce its carbon footprint -- a core value.

Check-out the Washington Post article here.