Lack of Clarity Ends Up in Poor Leadership
posted on: Friday, September 21, 2007
For those who have closely monitored the charitable sector and its leadership, few will be surprised by the sanctimony of its elite. They are the true believers in the purity of the nonprofit sector. A perfect illustration was the Charlie Rose Show segment on philanthropy with Judith Rodin of the Rockefeller Foundation, Joel Fleishman of Duke University and author, The Foundation: A Great American Secret and Mathew Bishop of The Economist.
The show illustrated the mixed signals that that the leadership of the philanthropic sector is sending, the role of government oversight and the financial commitment of government and philanthropy to those in need.
The discussion was basically between Fleishman and Rodin. The two of them are from the nobility of the philanthropic society. Fleischman is former President of the foundation Atlantic Philanthropies and former chair of the Markle Foundation and presumably a good friend of Rose. Rodin is a former president of the University of Pennsylvania, and a provost at Yale University. Poor Bishop; he was drowned out by crosstalk and interruptions.
The discussion is reminiscent of Fleischman’s book— an attempt to stay on the fence and not ruffle anyone’s feathers. Fleischman said that with his book, he hoped that foundations realize that “they need to open up themselves so that they get ideas from the outside, criticisms from outside. The problem is the foundations aren’t really accountable to anybody except their own boards.” He quickly clarified that by “outsiders” he didn’t not mean government, nor regulatory structures, but people from the nonprofit sector such as other foundations. Just minutes later he suggests that he wants foundations to ‘be more carefully watched, essentially, by the governmental apparatus…There really isn’t effective oversight at the governmental level not just of foundations but of the whole nonprofit sector.’
As an activist in the Expert Advisory Group of the Independent Sector’s (IS) Panel on the Nonprofit Sector, Fleischman shared the Independent Sector’s original position against outside regulation. Based on his conflicting positions, we are not certain as to his current position. We do know that despite its public protestations against regulations, the Independent Sector has converted. It has pandered to the lawmakers and coveted regulations.
It’s simply startling and certainly inexplicable! In the Independent Sector’s final document, which Fleischman presumably endorses:
· They asked the government to assist in educating board members and professional leaders because both are not aware of the expectations and requirements imposed upon them. (That says a ton about what IS thinks about the sector and the quality of those who lead it at the agency level.)
· They requested government assistance for resources to facilitate full implementation and new regulations to prevent abuses. (This is particularly interesting because they have said that the abuses are perpetrated by a few. Why punish all?)
· They endorsed overall tax enforcement and improved oversight of charitable organizations as well as audits and investigations and additional resources. (Contrary to public pronouncements, nonprofit leaders must believe that there is significant abuse to warrant increased audits and investigations.)
· They asked the Internal Revenue Code to impose penalties on board members and other managers of charitable organizations who approve of self-dealing or excess benefit transactions, including excessive compensation, not only if they knew that the transaction was improper but also if they “should have known” that it was improper. (Where was the IS when many of the nonprofit stalwarts got caught in their misdeeds?)
· They suggested increasing reporting requirements. (Increased reporting requirements are easier for the staffs of larger organizations---the Independent Sector’s major constituent. This may strangle smaller nonprofits.)
· They asked more disclosure on travel, entertainment, gift and car expenses.
· They wanted legislation on board reform including size as well as additional requirements for board participation. (It is surprising that simple guidelines wouldn’t work in this regard.)
And, in recent testimony, the IS president and CEO Diana Aviv paved the way for the nonprofit-government relationship. She requested the creation of the equivalent of the federal Small Business Administration to implement new regulations put on the sector. In essence, the nonprofit sector leadership wants to concretize a regulatory system.
This doesn’t seem like a leadership that endorses self-reform, does it?
Judith Rodin comments regarding the role of foundations were perplexing as well. She suggests that foundations do not replace government. However, that position contradicts the practice of the current administration. The Bush administration has proposed over $200 billion dollars in federal cuts over the next four years. The money is for programs providing services in education the environment to assistance for low-income families.
Such cuts reduced capacity for general services, leaving many people to fend for themselves or turn to existing nonprofits. Many foundations step in and increase their monetary awards, effectively replacing the missing government contributions. Others take a more strategic approach to awarding grants, making more collaborative grants, and in some cases providing low-interest loans instead of grants. The foundation-government relationship has been long-standing, but as the federal funds continue to dry up, the resources of the voluntary sector are becoming overtaxed.
Those speaking on behalf of the philanthropic sector have purported to be its leaders. Independent Sector represents, at most, 30% of all of the charitable organizations. They cling to that position because of the apathy of the other seventy percent. When the vast majority wakes up to the urgent reality that they face they will find out that they were blindsided.
The nonprofit sector needs leadership that will show the mettle to address the multitude of problems that will put it on the right track and not stifle the vitality and ingenuity that it once had.
Gary Snyder is managing partner of Nonprofit Imperative. He can be reached at gary.r.snyder@gmail.com. His website is: www.garyrsnyder.com.
Labels: accountability
The show illustrated the mixed signals that that the leadership of the philanthropic sector is sending, the role of government oversight and the financial commitment of government and philanthropy to those in need.
The discussion was basically between Fleishman and Rodin. The two of them are from the nobility of the philanthropic society. Fleischman is former President of the foundation Atlantic Philanthropies and former chair of the Markle Foundation and presumably a good friend of Rose. Rodin is a former president of the University of Pennsylvania, and a provost at Yale University. Poor Bishop; he was drowned out by crosstalk and interruptions.
The discussion is reminiscent of Fleischman’s book— an attempt to stay on the fence and not ruffle anyone’s feathers. Fleischman said that with his book, he hoped that foundations realize that “they need to open up themselves so that they get ideas from the outside, criticisms from outside. The problem is the foundations aren’t really accountable to anybody except their own boards.” He quickly clarified that by “outsiders” he didn’t not mean government, nor regulatory structures, but people from the nonprofit sector such as other foundations. Just minutes later he suggests that he wants foundations to ‘be more carefully watched, essentially, by the governmental apparatus…There really isn’t effective oversight at the governmental level not just of foundations but of the whole nonprofit sector.’
As an activist in the Expert Advisory Group of the Independent Sector’s (IS) Panel on the Nonprofit Sector, Fleischman shared the Independent Sector’s original position against outside regulation. Based on his conflicting positions, we are not certain as to his current position. We do know that despite its public protestations against regulations, the Independent Sector has converted. It has pandered to the lawmakers and coveted regulations.
It’s simply startling and certainly inexplicable! In the Independent Sector’s final document, which Fleischman presumably endorses:
· They asked the government to assist in educating board members and professional leaders because both are not aware of the expectations and requirements imposed upon them. (That says a ton about what IS thinks about the sector and the quality of those who lead it at the agency level.)
· They requested government assistance for resources to facilitate full implementation and new regulations to prevent abuses. (This is particularly interesting because they have said that the abuses are perpetrated by a few. Why punish all?)
· They endorsed overall tax enforcement and improved oversight of charitable organizations as well as audits and investigations and additional resources. (Contrary to public pronouncements, nonprofit leaders must believe that there is significant abuse to warrant increased audits and investigations.)
· They asked the Internal Revenue Code to impose penalties on board members and other managers of charitable organizations who approve of self-dealing or excess benefit transactions, including excessive compensation, not only if they knew that the transaction was improper but also if they “should have known” that it was improper. (Where was the IS when many of the nonprofit stalwarts got caught in their misdeeds?)
· They suggested increasing reporting requirements. (Increased reporting requirements are easier for the staffs of larger organizations---the Independent Sector’s major constituent. This may strangle smaller nonprofits.)
· They asked more disclosure on travel, entertainment, gift and car expenses.
· They wanted legislation on board reform including size as well as additional requirements for board participation. (It is surprising that simple guidelines wouldn’t work in this regard.)
And, in recent testimony, the IS president and CEO Diana Aviv paved the way for the nonprofit-government relationship. She requested the creation of the equivalent of the federal Small Business Administration to implement new regulations put on the sector. In essence, the nonprofit sector leadership wants to concretize a regulatory system.
This doesn’t seem like a leadership that endorses self-reform, does it?
Judith Rodin comments regarding the role of foundations were perplexing as well. She suggests that foundations do not replace government. However, that position contradicts the practice of the current administration. The Bush administration has proposed over $200 billion dollars in federal cuts over the next four years. The money is for programs providing services in education the environment to assistance for low-income families.
Such cuts reduced capacity for general services, leaving many people to fend for themselves or turn to existing nonprofits. Many foundations step in and increase their monetary awards, effectively replacing the missing government contributions. Others take a more strategic approach to awarding grants, making more collaborative grants, and in some cases providing low-interest loans instead of grants. The foundation-government relationship has been long-standing, but as the federal funds continue to dry up, the resources of the voluntary sector are becoming overtaxed.
Those speaking on behalf of the philanthropic sector have purported to be its leaders. Independent Sector represents, at most, 30% of all of the charitable organizations. They cling to that position because of the apathy of the other seventy percent. When the vast majority wakes up to the urgent reality that they face they will find out that they were blindsided.
The nonprofit sector needs leadership that will show the mettle to address the multitude of problems that will put it on the right track and not stifle the vitality and ingenuity that it once had.
Gary Snyder is managing partner of Nonprofit Imperative. He can be reached at gary.r.snyder@gmail.com. His website is: www.garyrsnyder.com.
Labels: accountability
posted by Gary at
10:25 AM
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