Board Chairs and Board Leaders Mary Hiland, nonprofit leadership expert, interviews Mike Burns to discuss national research on board chairs and board leadership.
Inspired Nonprofit Leadership Mary Hiland, nonprofit leadership expert, interviews Mike Burns to explore nonprofit board stages of development. Mike offers that recognition of board stages helps establish achievable expectations.
"Effectively Raising Capital: The Board Chair & Executive Director Relationship" Mike Burns and Kevin McQueen, partners at BWB Solutions, and special guest Carla Weil, the Chief Strategy Officer from Capital for Change, the largest full-service CDFI in Connecticut, share their experiences effectively identifying funding sources and raising capital to strengthen an organization and provide more impact in low-income communities. Carla Mannings of Partners for the Common Good and CapNexus moderated the panel.
Share power to strengthen your board. Are your board leaders struggling to balance power among themselves? Are they not understanding their roles outside of the boardroom? If you answered yes to any of these, listen to Ep. 58 of our podcast as we host Mike Burns and Judy Freiwirth. Mike and Judy share their expertise, which is based on their Nonprofit Alliance study Voices of Board Chairs.
Making a Lasting Difference I've been struggling to finish "Making a Lasting Difference" by Graeme Reekie since first I received this book about 6 months ago from Wren and Greyhound. The press is British but I thought the subject would be universal for nonprofits.
Alas and sadly, this is a slow, tedious read filled with platitudes and almost helpful considerations nonprofit managers might want to consider when thinking about how to financially sustain their organizations.
I have generally posited that a nonprofit has 4 "pillars" that comprise its DNA: program, management and operations, governance and sustainability. M. Graeme offers five: involvement ((having community support); Income generation; Innovation ("how to nourish and encourage incremental innovation); Improvement (systems and structures); and impact measurement. So he and I don't operate from the same lens but his is certainly one perspective.
Making a Lasting Difference is constructed in four parts, 20 chapters and 211 pages. The possibly most innovative content is in Part 2, Chapter 2 where paradoxes, principles and practices of sustainability are presented. The paradoxes:
a. Change - only by changing can organizations be sustainability, sustainability does not mean sustained, and, the lesson is that an org. must learn, adapt and evolve purposefully. Here the author poses that an org has to have its act together to achieve sustainability
b. Octopus - organizations need to reach out in new directions to grow but growing in too many directions pulls them out of shape; diversified income does not mean reduced risk; and, an org must focus on core organisational purpose and structure. Here the author says that mission drift will not make you sustainable.
c. Yes/No the things that an organisation needs to survive can also kill it. Saying yes to everything is fatal; sustainability is about more than just money. Capacity and quality matter. Understand when, how and what to say no to. I would offer this is the "stay in your lane" paradox.
d. Efficiency - Efficiency preserves resources but can impair development. Organisations cannot evolve, adapt or respond without spare capacity. And orgs should balance strategy and scrutiny. They should invest in capacity building.
To all of this I just want to say: uh, ok and thanks for the amazing insight. No, not really! I would not invest in this book. You can better spend your time reading the Federal Register looking for grant opportunities (good luck given the current environment) or going through the Foundation Center directory or building an endowment from rich people who loved you (yes, this really is the key to sustainability). Making a lasting difference may be a good idea when thinking about long-term impact from what your nonprofit does - reading this book will not.
As reported in multiple media (Chicago Tribune, New York Times etc.) the former Miss America who has been leading the charge against her own and many other women by the Miss America Organization is reinforcing her position that the remaining board of the nonprofit step down AND she will not help these members identify new leaders (an exec, a chair). Her position as noted in the following Chicago Tribune article is that all members are responsible for the bad behavior of the organization - whether or not they knew about or were involved in the misdeeds. Ms. Hagan offers that silence is in itself complicity.
Note to nonprofit boards everywhere - do you know what you need to know about your work culture and are you at least clear about what standards and values you have set and have a method for determining if these are being followed?
A former Miss America whose appearance and sex life was ridiculed in emails sent by officials of the Miss America Organization says the group's request to enlist former pageant winners in the search for new leaders is "laughable" and insulting.
Mallory Hagan told The Associated Press on Thursday that the offer made Wednesday night by the remaining members of the group's board is insulting to anyone who ever competed or volunteerred in the pageant.
She and other former Miss Americas are renewing their call for the entire board to step down. The CEO, president and board chairman resigned Saturday.
"The statement from the remaining Miss America Board of Directors is an insult to every Miss America and volunteer's intelligence," she said. "Implying that the complicit members of the current board will now choose the new leadership for the forward movement of the Miss America Organization is laughable.
The board said Wednesday it wants former Miss Americas and state directors to help in the search for new leadership, asking the groups to nominate four people to serve on a search committee that also will include two board members and a person the board members appoint. That offer drew widespread opposition from former Miss Americas and state title winners as soon as word of it circulated.
The board was hoping for nominations for the search committee by Jan. 3, but it was not immediately clear what would happen if the former winners do not participate.
"Nonprofits are not broken for-profits" is one of the best lines in this Forbes Nonprofit Council piece. The piece is written by the President/CEO of Junior Achievment - an organization that has managed to survive and even thrive multiple changing environments (although I think it helps that the folks who back this nonprofit are pretty much carrying forward their own accomplishments).
So, the article, titled Seven Things Everyone Should Know Before Working for a Nonprofit", offers the following recommendations in addition to the first, that nonprofits are not broken for-profits (a gross error I see time and time again by business types whose business experiences limit their ability to value process, teamwork (as a board and staff) and results that are not singularly financial.
Next: nonprofits are a lot of work. True enough although I believe this applies to every sector institution be it public, private and nonprofit.
Next: there are politics here, too. Again, in my experience, true for every sector institution - pretty much goes with anything that involves people on a mission or with a responsibility.
Next: it (working with nonprofits) can be thankless. The author's theory is that there could be the belief that working with for a nonprofit should always engender appreciation (you know, doing God's work). Of course, there are many life callings where one may think appreciation is warranted but let's be real. So, again, not singular to nonprofits but valid just the same.
Next: it does make a difference, even if you don't always feel it. True enough but not always. I would pose that nonprofits often face the same challenges in finding the right strategies to accomplish mission and it doesn't always make a difference. This too is a common reality in every sector.
Next: It's a great way to start a career. As the author notes, I agree that nonprofits may indeed be unique in both their need for volunteers and their willingness to provide volunteers with opportunities they would likely not have in other environments. That these skills are always transferable to other sectors or industries, maybe not but that might be fine. And of course, having career goals helps.
Finally, you won't be sorry. Would that were true but maybe it's true for more than less.
Perhaps an example of traces of what good leadership can be about, after clearly failing to enforce established standards and values, the board chair and CEO have resigned from the Miss America organization.
While the Miss America website states that the organization:
is more than a title, it’s a movement of empowering young women everywhere to achieve their dreams by giving them a voice to inspire change and by honoring their commitment to helping others.
But, according to the Huffington Post
a barrage of emails were uncovered over a span of three years, in which Haskell (the CEO) regularly engaged in offensive conversations about women. He joked about the suggestion that Miss America 1998 Kate Shindle should pass away, and called Miss America 2013 Mallory Hagan “trashy” and “huge” and speculated on how many men she had slept with. In response to an email from board member Tammy Haddad, who was offering a suggestion about promoting one Miss America in favor of others, Haskell wrote, “Brilliant…..f—ing Brilliant!!!! That will drive Gretchen INF—INGSANE.” Haddad has since resigned from the board.
49 former Miss Americas issued the following statement:
"We will continue to demand the resignations of every individual who either participated in the abuse of women or stood by and was complicit by failing to conduct proper due diligence, as legally required by their fiduciary obligations," the statement said. "In addition, we expect that no new board members will be appointed until every implicated board member has resigned."
While very public figures particularly in the corporate community have been learning about what can happen when harmful acts they do finally come to light, those governing these institutions (perhaps except for the Roman Catholic Church and Penn State) have largely gone unscathed. That the Board Chair resigned is a positive step and demonstration of what "ownership" means for an organization (for profit and nonprofit) and the former winner's call for "every implicated board member to resign" would be, in my opinion, the correct action for placing responsibility within every organization that has tolerated an environment of doing harm - internally or externally (e.g. the Boy Scouts).
But of course, corporate america's boards have not been as honest and brave as the Miss America Chair so it is with hope, that at minimum, the imposition of values and standards that do no harm, at least internally, might be another fall-out of this new world where at least women can step forward and tell their story and not see impunity for those who have failed them.
Individuals, beginning in 2017 - and I'm really talking about the folks who generally give the $25 to $1000 annual gifts, are now going to be put to the test around the theory that individuals are not motivated by taxes to make a contribution.
We should first be reminded that the $25-$100 annual givers are the long-term sustainability strategy focus of nonprofits who work the pyramid model of donor development: get prospects in-the-door as event givers or respondents to an direct mail appeal and convert them to annual givers at higher level of gifts over time and eventually as major gift and even deferred or "will" givers.
With a tax deduction taken off the table, what then must be the incentive for individuals to give (yes, there is a deduction but only after the much bigger deductible)? I pose that what nonprofit boards must wrestle with is fully understanding what it is that truly motivates an individual to support a particular issue, cause or service. I pose further that what nonprofits must now really focus on "selling" is the story about change should a gift be made - donors will not (nor I necessarily think they really did) buy services but instead, results as demonstrated though stories. And the stories need be meaningful to the target donor tapping into their experience via kin or folks they encounter daily or situations (status quo) that they are not happy with.
Yes, soliciting should continue to be about "me" and my desire to change the status quo or at least what I think is an unsatisfactory status quo. What has moved board members to serve on boards needs to be recognized and highlighted to those who would be donors. The alternative of course is the design of events and activities and experiences that prospects will want to experience despite the cause (or seeing the cause as an extra benefit).
The time for just asking and expecting a "yes" are even more over than they have been if they were ever. Nonprofits must increase their understanding of who wants to invest in what the nonprofit has to offer now recognizing that tax deductions are not the correct answer.
Of the many articles from newspapers and journals I read, one common thread, consistent with the piece I have included today from the Jewish Link NJ is this insistence by consultants (and pretty much, executives, that board members have, beyond their fiduciary and strategic roles, the role and responsibilities of raising money. And yet, this is the area where board members, unless they agreed when they were first recruited or joined a board, don't generally agree that this is indeed their job. My position again: if individuals understand and agree when they are recruited and join, it's not their job. And, it must be understood that it is on the staff to help members take on this task - the job should be both strategic and tactical and not just be left to say "it's time, go ask someone for money". We must and can be better than just having expectations.
Boards of Directors: Roles and Responsibilities
By Norman B. Gildin, President, Strategic Fundraising Group | December 21, 20I was recently asked by a reader of this column whether I would write about working with boards of directors of Jewish nonprofit organizations. It struck me that this individual differentiated between boards of “Jewish” and “non-Jewish” organizations. In my view, there is no difference, especially if the roles and responsibilities of board members are clearly delineated. Any board should follow the same principles.
The underlying implication raised about “Jewish” nonprofit boards really is the “under the surface” meaning. Many folks are concerned that these boards are tougher and more challenging to work with than other boards. Having seen other boards in action, it is not the ethnicity or religion that dictates its toughness. Instead, it is its steadfast resolve to succeed by following generally accepted best practices.
Over the years, I have worked with both large and small boards. Size is not a determinant of effectiveness. What remains critical is whether boards unambiguously understand their roles and responsibilities. In order to better understand what this means, let’s consider history.
The crucial role of a nonprofit board has increased over time. In 1940, there were only 12,500 charities registered with the IRS. Today, there are an estimated 2.3 million nonprofit organizations operating in the U.S., with approximately 1.6 million registered with the IRS. Since 2000, we have seen a nearly 30 percent increase in such entities.
With the explosion of nonprofits, a board’s central role regarding finances, accountability, compliance and transparency has evolved. As a result, over time, more entities are vigilantly watching nonprofits. These include various state legislatures, the IRS, watchdog organizations such as Charity Navigator, Guidestar and the Better Business Bureau Wise Giving Alliance, the news media, other federal agencies and the public at large, including donors. It became evident that boards needed to be focused on three key areas of responsibility: (1) governance, (2) advocacy and (3) philanthropy.
Board members are the fiduciaries of the nonprofit and govern by steering the organization towards a sustainable future by adopting sound, ethical and legal governance and financial management policies, as well as by making sure the nonprofit has adequate resources to advance its mission.
Board members are uniquely positioned to be successful advocates and ambassadors for their missions. As business leaders, community volunteers, philanthropists and opinion leaders, they have the connections, the confidence and the respect needed to speak up on behalf of their organizations when policy decisions are made that might affect the organization’s ability to achieve its mission.
When it comes to philanthropy, nonprofit boards have two indispensable requirements: “To give and to get.” This fundraising responsibility is often the most challenging facing boards. So, the question often asked is “Why?” The answer is simple: By giving, and giving generously, it ensures that each board member has “skin in the game.” Personal giving also sets the stage for engaged fundraising by board members.
Experience and research have shown that personal giving by board members works in at least three ways: (1) It is a public declaration that the board member has invested in the charity, (2) It indicates that board members have a commitment to the organization and its mission and (3) It encourages other donors to give and impresses institutions that provide grants or other support. In fact, many major donors and foundations will not support a charity unless the board achieves 100 percent giving.
The focus of our monthly columns is fundraising. In 2015, nearly $375 billion was raised by nonprofit organizations in this country. These funds came about primarily from individual donors and major gifts, foundation giving, charitable bequests and corporate giving. It is undeniable that boards of directors played a vital role in raising these funds.
About 15 years ago, I participated in a seminar entitled “Building a Fundraising Board.” One of the presenters described 12 types of boards. Space limits my ability to describe these now, but we will next month. Nonetheless, it is irrefutable that if the roles and responsibilities of the board are explicitly defined, then the nonprofit—Jewish or non-Jewish—will be far ahead of the game.
Is your board ready to undertake its mission?
By Norman B. Gildin, President, Strategic Fundraising Group
Norman B. Gildin has fundraised for nonprofits for more than three decades and has raised upwards of $92 million in the process. He is the president of Strategic Fundraising Group whose singular mission is to assist nonprofits raise critical funds for their organization. He can be reached at [email protected].
I regularly include articles from folks about recruiting new members and the value of nonprofit service. Until today I have not seen the likes of the following blog excerpt by a gentlemen who has declared his intention to release himself from all nonprofit board service.
The blog begins with the writer reviewing his "rule" to not serve on more than three boards at any one time. I have often thought that service on multiple boards at the same time to be a challenge - possibly one that brings with it prospective conflicts of interest (e.g. who to raise money for, meeting attendance). But this blogger admits that he has violated his rule and now serves on 8 boards and has a commitment for a 9th. Whew. Talk about competing interests.
But competing interests aren't the focus of his sharing. No, he has concluded for himself that he can have a greater impact lending his skills and experience as a non-board member. And, perhaps this is so and definitely worth everyone who serves as a board member's consideration.
I think however it's sad that these boards have failed to provide this individual with valuing board member opportunities. Yes, I believe the conclusion reached by this blogger is on the nonprofits. They have failed him. And that is a story to be understood. Where board members perceive they are just biding their time and making little of a difference AND they have given it their all, the nonprofit failed. Don't let this happen to you.
December 16, 2017
Ending My Service On Non-Profit Boards
I’ve decided to stop serving on non-profit boards.
I used to have a rule that I’d only serve on three non-profit boards at a time. I let this get out of control and found myself on eight non-profit boards with a commitment to join a ninth one.
During our Q4 vacation last month, Amy and I talked a lot about this. I realized that I wasn’t enjoying the non-profit board service, even though I deeply enjoy my personal engagement and support of the organizations I’m on the boards of.
There was an intellectual conflict here that Amy and I spent a lot of time discussing. Our philanthropic work is important to us. However, the actual board service part of it, while fulfilling to Amy, is not fulfilling to me.
It’s also very time-consuming. While most of the boards only meet four times a year, each board meeting is three hours long. If I include another two hours for reviewing materials in advance and travel, that’s 20 hours per year per board. For eight boards, that’s 160 hours/year. If I only worked 40 hours/week, that’s four weeks of work. While I work a lot more than 40 hours/week, the five hours per board meeting is probably low, especially if I physically travel to a board meeting.
My conclusion was that I could be just as impactful to the non-profits we support – and in some cases even more so – without being on the boards. Instead of consuming my time with board meetings, I’ll engage directly with the CEOs and Executive Directors of these non-profits in ways that are specifically helpful to them. I’m already doing this in many cases, so it’s not a direct re-allocation of time, but rather a huge time saving on my part, which allows me to more focused – and more enthusiastic – about the work I’m actually doing.
I’ve now talked with all the CEOs/EDs of the non-profit boards I used to serve on. They all understand my perspective and, in most cases, are supportive and excited about the change in my involvement. As my goal is not to withdraw from the things I’m involved in, but to increase my impact by shifting my focus and activities, the feedback was good positive reinforcement to me.
There's effective and efficient governance and there's ineffective and inefficient governance and maybe there's a combination of both that also possibly includes violating board fiduciary duties of care, loyalty and obedience (with heavy emphases on conflicts of interest and redirecting the use of donated funds). All of this appears to be the case for the New Orleans Public Library Foundation, the New Orleans Jazz Orchestra and Irvin Mayfield, the jazz musician.
Mr. Mayfield was indicted for all kinds of fraud. While working/leading the New Orleans Public Library Foundation he managed to acquire and redirect funds to strengthen the New Orleans Jazz orchestra but also benefits himself. The indictment does suggest that he was largely responsible for this "stuff" but I can't help ask first, where was the board during all this? For sure it appears that the board supported the transfer of funds to the orchestra - they approved the expansion of the Library's mission. Prudent? It's unclear that the only way to support the growth of the orchestra was through the work of the Foundation. I don't know. But in reality, both missions have merit - just maybe not under the same roof especially if donors thought their monies were going for the library. I again, don't know what was behind the board decision to expand mission. This is worthy of investigation.
Bottom line though: Mr. Mayfield might not have successfully gone so off-the-rails for his own benefit if the board of the Library Foundation had not been so singularly focused on supporting Mr. Mayfield for whatever he proposed. And one must ask: where is this board now and why isn't some part of the conclusion on them? Or, as evidence suggests, did they believe the means of using the Library justified the ends of supporting the Orchestra?
The 19 counts against trumpeter Irvin Mayfield and his longtime partner, Ronald Markham, that were released Thursday include one count of conspiracy, four counts of wire fraud, one count of mail fraud, one count of money laundering conspiracy, 11 counts of money laundering and one count of obstruction of justice.
Mayfield is accused of using his position as head of a charity that supported New Orleans Public Library to funnel money to a jazz orchestra he founded, to a nonprofit bank account that he controlled and to pay for his personal expenses. The criminal charges come about 2½ years after a WWL-TV began a series exposing the behavior.
Thursday's indictment alleges that Mayfield and Markham began a conspiracy in August 2011 by transmitting money from the New Orleans Public Library Foundation to accounts they controlled at the New Orleans Jazz Orchestra that helped pay their salaries, Mayfield's production company and travel expenses that included high-end hotel stays in New York.
Mayfield is accused of using $15,000 to buy a gold-plated trumpet, being paid $66,000 which in turn went to shopping at Saks Fifth Avenue, gambling at Harrah's Casino and a fee to perform at New York's Carnegie Hall. Tens of thousands more were alleged to have paid the jazz orchestra's operating expenses.
"To purposefully and intentionally bring this 10 days before Christmas, ... it was kind of mean-spirited," said Claude Kelly, Mayfield's court-appointed public defender.
Jazz trumpeter Irvin Mayfield, shown in a 2007 photo, was indicted Dec. 14, 2017, accused of diverting money from a nonprofit to his use and the use of another nonprofit he controlled.
Greg Miles Photography
Mayfield played a gold- and jewel-encrusted trumpet for presidents and foreign dignitaries, appeared in We're Jazzed You're Here advertisements for the city and served on many nonprofit boards. The special trumpet was stored under armed guard and named the Elysian trumpet after Mayfield's father was found drowned on Elysian Fields Avenue in the flood.
Mayfield rose to prominence locally in the late 1990s, and former Mayor Ray Nagin appointed him as the city’s cultural ambassador and chairman of the public library board. In 2008, Mayfield took over as president of the library’s nonprofit support foundation.
At the time, the New Orleans Public Library Foundation existed solely to receive donations and give financial support for the city’s historically underfinanced public libraries.
By 2012, Mayfield had convinced the organization's five-member board to expand the nonprofit’s mission to provide more general community support and to give himself sole discretion over its finances.
Even before the board took official action to expand the library foundation’s mission, the foundation started sending large amounts of money to the New Orleans Jazz Orchestra, another nonprofit that Mayfield established and directed. The orchestra also paid Mayfield a six-figure salary and tens of thousands more each year to Mayfield’s private production company.
From 2011 to 2014, the library foundation tapped into donations meant for the city’s libraries and gave the orchestra more than $1.1 million in grants to help it build a new community center, music venue and bar in Central City called the New Orleans Jazz Market. Mayfield justified the grants, which exceeded the foundation’s payments to the entire city library system, by claiming the Jazz Market would serve as a specialized music library branch.
Markham, who also received a six-figure salary from the jazz orchestra, was on the library foundation board and voted to give his partner control over the financial decisions.
"I do not believe that I have violated any law," Mayfield said in a statement issued July 5 2016.
The federal investigation began in 2013. As the investigation intensified this year, Mayfield tried to sell the large Fontainebleau neighborhood home where he often held extravagant parties.
It initially listed for more than $700,000. He sold it Oct. 31 for $553,333, barely more than he paid for it in 2012.
In the three-legged stool paradigm that helps describe the relationship and existence of the three primary sectors in US society: the business sector seeks to meet consumer needs in exchange for profits; the public sector meets the lowest common denominator of needs (in exchange for taxes); and the nonprofit sector fills the voids between the two sectors primarily in exchange for the pursuit of passions, Theory of Change, and mission.
This differentiation between the public and nonprofit sectors is being demonstrated and tested in North Wildwood, New Jersey whith an historic and operating lighthouse, owned by the city but until today, managed by a nonprofit. And of course, personalities and relationships are helping define what will be the next steps but the whole situation is not one of pleasantness nor does it favor the nonprofit.
Perhaps just not paying full attention to its fiduciary duties, the nonprofit caretaker of the lighthouse appears to have missed some accountability steps and the mayor (as the story goes) wants to remove the nonprofit and let the city take back what was its responsibility but one that it "contracted-out" to a nonprofit who has the vision and passion for the work. The resolve appears to be tied-up between the key personalities but support is being sought, by the nonprofit, outside the "neighborhood".
Continuing with the three-legged stool paradigm, if the public has "chosen" to operate its property, the "gap" that might otherwise be there, is filled. Such is the ending....
New Jersey has a host of popular lighthouses, but you may not have heard of the Hereford Inlet Lighthouse in North Wildwood. It’s not one of the tall, statuesque pillars that tourists favor, but the Hereford is a workhorse that still serves as a functioning lighthouse. Unique along the East Coast, its design is more common in California and Washington state.
Its tower is just under 50 feet, far lower than its nearest lighthouse neighbor — the classic tall tower of Cape May Point Lighthouse. When it was completed in 1874, however, it was the tallest building on the island. It fact, it was one of the only buildings on the island.
After the light was automated in 1964, the building was boarded up and left to deteriorate for years. By 1982, the city took control of the lighthouse, though it remained state property.
Now a very public fight is blazing over who should rightfully manage the Victorian-era lighthouse overlooking the Hereford Inlet.
Under new management
The Friends of the Hereford Inlet Lighthouse, formed to run day-to-day operations under a contract with the city of North Wildwood, has been locked out of the building.
Steve Murray, chairman of the Friends of the Lighthouse board of trustees, called the move political, driven by Mayor Patrick Rosenello. Murray said it could undo years of restoration work, changing the lighthouse from a respected interpretive museum to a welcome center for the city.
The mayor, in turn, said the group has not capably managing the lighthouse operation, as well as refusing to make what he called needed changes.
Murray has overstepped his authority, threatened to sue a neighbor and verbally abused city employees, Rosenello said. Moreover, required annual reports were never filed.
He said the city had little choice but to take over.
The Friends organization’s agreement with the city runs out at the end of this year. But the change is not going to wait for the end of the month. On Dec. 4, a specialist hired by North Wildwood began taking inventory at the lighthouse. At the same time, the city literally locked out the Friends, changing the locks on the building.
Recently, the community gathered at the lighthouse as it does most years for the annual tree lighting.
But on social media and on the pages of area newspapers, the Friends of the Lighthouse have launched a campaign to be reinstated.
Hereford Inlet Lighthouse is located in North Wildwood, New Jersey. (Alan Tu via Google Earth)
No agreement on operation
The lighthouse is owned by the state, and leased by the city through the New Jersey Department of Environmental Protection.
In 2011, North Wildwood officials signed an agreement with the Friends group, made up primarily of people who had been involved with the lighthouse restoration and operations already. Things seemed to be fine, at first.
“Unbeknownst to us, serious management deficiencies began to emerge,” Rosenello said in a recent interview. In the spring of 2016, he said, the city learned that a $17,000 of federal grant money was withheld because deadlines were missed, which he said put the city on the hook for the funds. While that is one of the major points the city has raised, a memo detailing the city’s concerns points to everything from failing to provide proof of insurance to how Murray handled an issue with a neighbor.
This year, Rosenello said, the city needed to make a change. With the approval of the city’s council, he proposed a new agreement.
“The Friends told us that they had no interest in fixing the problems,” Rosenello said. “As a matter of fact, they didn’t want the city involved at all.”
Murray said he believes the mayor deliberately presented an unreasonable proposal, “so outrageous that we just couldn’t agree to it.
He accused the mayor of a power grab, leaving the Friends to run the gift shop and tours, while the city took over everything else. Murray, who has issued a point-by-point response to the mayor’s claims, maintains that the issue with the grant was beyond the group’s control.
“The only person in the world that wants to do this is the mayor,” Murray said.
Now Murray is contemplating an end run around North Wildwood — and the mayor —by seeking a deal directly with the state to put the Friends in charge of the lighthouse.
Similar sites are run directly by nonprofit boards of trustees. “We’re the only lighthouse in the state that’s leased directly to the city,” Murray said. “It’s an archaic system that should have been changed years ago.”
Rosenello suggests the Friends were just in over their heads.
“I am not diminishing Steve Murray’s role. He was very dedicated to that lighthouse. He was passionate about it. That’s the reason why we tried to work with them,” said Rosenello.
Debate moves online
The Friends of the Lighthouse group has enlisted historic and environmental organizations — as well as launching a campaign through social media — asking people to contact the DEP and request that the lighthouse be restored to the group’s oversight. At herefordlighthouse.org, the main page is dominated by an appeal for support and money.
Rosenello does not see a clear path to a compromise. And, as of January, the city will take direct control of the lighthouse operations. North Wildwood is in compliance with its lease with the state, the mayor said, so the city won’t need any further approvals.
But state officials plan to have their say.
“The DEP is aware of the current issue between the Friends group and the city and hopes for an amicable resolution that ensures the continued maintenance, preservation, and operations of this historic structure,” said DEP spokesman Lawrence Hajna. “It should be noted that any changes that may affect the lighthouse or its grounds must be reviewed and approved by the DEP.”
Rosenllo, who said taking over the lighthouse operation won’t add significantly to the city’s budget, and he plans to scrap a $6 entrance fee as unnecessary.
“We’re simply going to return to something that’s worked,” he said. “We’re not looking at this as a moneymaker, that’s for sure.”
The following Berkshire Eagle letter to the editor is a reminder of a rule I like to remind boards: nonprofit board members are surrogate owners - they are tasked with the responsibilities which all owners have but they do so on the behalf of the public (hence the use of the term "surrogate". Yes, board members come to a common table with a Theory of Change and a set of values to propel them in a common direction but it is the public who gives these leadership volunteers the "right" to make decisions and look-out for the interests of the tax exempt dollars that are used to pursue these interests. In my opinion, this letter writer is absolutely on-point.
Here's the piece:
Letter: Protect our common property at museum
Posted
To the editor:
I am the owner of the Rockwell paintings that the Berkshire Museum board is trying to sell. In fact, I own all of the works at the museum. So do most of your readers. The museum board of trustees serves on behalf of all the citizens, protecting and caring for the paintings and other assets so that everyone may enjoy them. Because we each can't oversee every nonprofit asset, we citizens "entrust" them to the volunteer board. The same is true for all nonprofit organizations — private schools, food kitchens, the Pittsfield Family Y, Jacob's Pillow, Mass MoCA, the Berkshire Botanical Gardens. And in this case, when a nonprofit board is acting unethically, and possibly, illegally, the Attorney General is there to protect us and the things we own.
There are few museums, of the thousands in the U.S. that have gone out of business. When a museum dissolves it is usually because of an ineffective board and lack of stable professional leadership. Effective, intelligent, ethical museum boards raise money and select and support great leaders. Look at a healthy nonprofit and you will find that combination — a generous board willing to raise money and donate personally that also selects a wise leader and supports her or him over the long term. The Berkshire Museum board, caught in a financial bear trap of its own doing, is trying to chew off its ankle to survive. Its record of personal contributions is unimpressive and its choices of directors uninspired.
Most of our beloved Berkshire nonprofit arts institutions — Barrington Stage, the Mahaiwe, the Norman Rockwell Museum, Jacob's Pillow, the Clark, the Boston Symphony Orchestra and countless others share the same characteristics — generous boards that select their leaders wisely and then support them heartily.
Twenty years ago, when the board of the Terra Museum of American Art tried to move the collection out of its home in Chicago to Washington, D.C., the Illinois Attorney General fired the board and installed a new one; that board then selected a president who, over the last 18 years, has led the institution to new heights, serving not only Chicago and the state, but the world.
It is time to encourage the AG to protect our paintings — yours and mine — because they who are tending them now simply can no longer be trusted.
What should a nonprofit board member be asking to be effective? One might argue that, in recognizing their fiduciary duties of care, obedience a loyalty, the questions are clear:
how are we preventing or avoiding risk (financial, sustainability, programatically)?
are we pursuing mission (includes revisiting as times change) and how is that going (correct direction strategically and what are our results)? This question also includes answering sustainability and management questions.
are we making any decisions that benefits "me" versus the organization? Of course this is one part of a bigger question - how are we doing as a board - efficiency and effectiveness.
This bucket of questions can pretty much ensure a board is on a path of effectiveness - asking and getting sound answers to these questions.
The McKinsey folks have an alternate slice on this question. In their December 2017 newsletter, William Meehan and Starkey Jonker propose the following:
Question 1: Are we succumbing to mission creep? To me this appears to be coming at the success question in a sort of negative approach but I believe the author's point is to challenge boards to ensure they are always challenging themselves and additionally working to understand how strategic is the organization.
Question 2: How is our ‘theory of change’ informing our strategy? I a a big proponent of Theory of Change (see my Blog). I truly believe that the Theory of Change is what brings individuals to the board and what is or should be the framework for everything an organization does. Theory of Change informs the mission. I also believe the Theory of Change should be visited during every strategic planning process and certainly, when some new opportunity arises and the organization must question if that opportunity is consistent with mission and its theory. So, I concur with McKinsey this is a critical question as a central part of every strategic planning and evaluation activity.
Question 3: How are we evaluating our impact? Yes, understanding impact is central to a board's duty (in pursuit of mission) so for me the question is not as much how but what results are we producing - nuanced but an important nuance particularly given that so few boards even understand the how or what elements of evaluation.
Question 4: Do we have the right ‘fuel’ to drive our organization? The author focuses this question around governance and personnel. Fair enough. This is I believe to the social responsibility focus on "people". Fair enough. One of the 4 "central" questions - not sure.
