The following lessons about the lack of governance was pulled from a Chicago Tribune story on the Bernie Mac Foundation. Comedian Mr. McCullough died about three years ago but one of his legacies is a foundation focused on supporting sufferers from sarcoidosis. Mr. Nonprofit board members: please take note.
1. But public records and interviews show that the charity is falling short of key benchmarks for such organizations, as well as the generous intentions of its founder. For instance, records for the six years ending in 2012 show that 13 percent of the Bernie Mac Foundation's spending has gone to charitable programs, far below the 65 percent minimum benchmark recommended by the Better Business Bureau's Wise Giving Alliance and the 75 percent threshold recommended by CharityNavigator.
2. A national sarcoidosis group also told the Tribune that it never received an agreed-upon grant from the Bernie Mac Foundation. Ginger Spitzer, executive director of the Foundation for Sarcoidosis Research, said the Bernie Mac Foundation pledged $100,000 to the group in 2010 but paid out only $50,000. She said her group then cut ties with the charity, though the Bernie Mac Foundation until recently continued to claim on its website that the two groups are "partners."
3. Mac's daughter, Je'Niece McCullough, resigned from the Bernie Mac Foundation board of directors almost three years ago because, she said, she felt the organization lacked focus or direction. "It was like the blind leading the blind," she said. "When my dad was alive, he seemed to have a goal in mind. We didn't seem to have one."
4. Board President Rhonda McCullough, who is Je'Niece McCullough's mother and Bernie Mac's widow, said she was unfamiliar with the details of the organization's finances. "Not really knowing what a foundation entails, you learn as you go," she said. (Uh, big RED FLAG here -- thre board president doesn't understand the finances).
5. About $121,600 (from a total of $767,636) during the 2007-12 period went to salaries paid to Rhonda McCullough's two sisters, who work for the charity. Records show that more than $200,000 was paid out to two firms that have similar names to companies run by Edward Williams, who is treasurer of the Bernie Mac Foundation. Those companies have the same office address as the charity. Mary Ann Grossett, a third sister and executive director of the Bernie Mac Foundation, told the Tribune in a letter: "I do not know about Attorney Williams with respect to his companies." She added: "I only know that my brother-in-law, Bernard McCullough (Bernie Mac), thought the world of him."
Payments to relatives and board members are permissible under the law. Grossett, a third sister, was paid an annual salary of $40,000 as executive director in 2011 and 2012.
6. Attorney Joseph Ament, the nonprofit's secretary, declined to answer detailed spending questions, citing confidentiality. "The principal beneficiary of the Bernie Mac Foundation is the University of Illinois," he said.
Clearly, this is a good news, bad news story. the foundation has issues, particularly around governance. Interestingly, fixes are easy and not highlighted here, and it should be noted that the family is still raising money for the purpose of the foundation and grants are continuing to be given although not at the level equal to what is being raised. Let's hope that the purpose of the story was not about embarassing the family as much as seeing more fully to the intent of Mr. McCullough.