Unbelievable: Another Red Cross Debacle
posted on: Wednesday, November 28, 2007
We have heard it time and time again…”I resign my position as CEO of the American Red Cross”. We’ve heard it four times in the last 7 or so years. We’ve seen hundreds of thousands of dollars in severance pay approved by the ARC board.
On November 27, 2007, Mark W. Everson, CEO of the Red Cross and former head of the Internal Revenue Service just 6 months ago, resigned “for personal and family reasons”. The ousted president took personal liberties with a subordinate.
To its credit, the board of governors acted promptly when it found out that Everson had engaged in a “personal relationship”. However, the board should be well rehearsed in terminating CEOs. The departure continues a trend of rapid turnovers at the top. To be fair, personalities and performance were the initiators in the previous three. Bernadette Healy, a physician, after mishandling September 11 attack response. Marsha Evans left in 2005 after the Katrina fiasco. Interim president, Jack McGuire served between Evan’s departure and Everson’s appointment. There was apparent friction between the board of governors and some of the former executives.
As with the last three executives, the board tried to cover its tracks by saying that this departure “is disappointing…but the work of the American Red Cross will go forward”. Not a ringing endorsement of the Red Cross’ future.
This is a serious blow to the organization as it started to gain some momentum in wiping out its dilapidated image. The September 11 and Katrina responses were a hit to the already tenuous organization. It had bureaucracy and accountability problems. Many of the local and regional executives were at wits edge in dealing with the national organization. The organization lost its coveted designation as the first responder, the go-to agency, to FEMA. Recently there was criticism of the Red Cross over its aid program for victims of Hurricane Katrina, Means to Recovery. The agency was, however, gaining some praise for its role during the recent Southern California wildfires.
The American Red Cross should have seen a problem brewing when Everson, cognizant that the organization was bloated at the top, brought in several of his associates from the IRS. While that shouldn’t be an indictment in itself, he chose one of his closest former employees, his chief of staff, as the Red Cross’ ombudsman…the organization’s chief critic. Congress created the position after a lengthy investigation.
The selection process for the CEO is taking place under cloudy circumstances. To trim expenses, Everson indicated that he was going to have to lay off 3,000 employees at the national headquarters. The Board is in the midst of a newly revised charter which clarifies the roles of the executive and board and eliminates over half of the board seats in a couple of years.
Times are a changing! The leadership of one of America’s stalwart agencies has a challenge as it has never had before. Hopefully the decision-making will result in better results.
A lot of people are watching.
Gary Snyder is the author of Nonprofits: On the Brink and articles in numerous publications. His website: www.garyrsnyder.com. He can be reached at 248.324.3700
Labels: American Red Cross
We have heard it time and time again…”I resign my position as CEO of the American Red Cross”. We’ve heard it four times in the last 7 or so years. We’ve seen hundreds of thousands of dollars in severance pay approved by the ARC board.
On November 27, 2007, Mark W. Everson, CEO of the Red Cross and former head of the Internal Revenue Service just 6 months ago, resigned “for personal and family reasons”. The ousted president took personal liberties with a subordinate.
To its credit, the board of governors acted promptly when it found out that Everson had engaged in a “personal relationship”. However, the board should be well rehearsed in terminating CEOs. The departure continues a trend of rapid turnovers at the top. To be fair, personalities and performance were the initiators in the previous three. Bernadette Healy, a physician, after mishandling September 11 attack response. Marsha Evans left in 2005 after the Katrina fiasco. Interim president, Jack McGuire served between Evan’s departure and Everson’s appointment. There was apparent friction between the board of governors and some of the former executives.
As with the last three executives, the board tried to cover its tracks by saying that this departure “is disappointing…but the work of the American Red Cross will go forward”. Not a ringing endorsement of the Red Cross’ future.
This is a serious blow to the organization as it started to gain some momentum in wiping out its dilapidated image. The September 11 and Katrina responses were a hit to the already tenuous organization. It had bureaucracy and accountability problems. Many of the local and regional executives were at wits edge in dealing with the national organization. The organization lost its coveted designation as the first responder, the go-to agency, to FEMA. Recently there was criticism of the Red Cross over its aid program for victims of Hurricane Katrina, Means to Recovery. The agency was, however, gaining some praise for its role during the recent Southern California wildfires.
The American Red Cross should have seen a problem brewing when Everson, cognizant that the organization was bloated at the top, brought in several of his associates from the IRS. While that shouldn’t be an indictment in itself, he chose one of his closest former employees, his chief of staff, as the Red Cross’ ombudsman…the organization’s chief critic. Congress created the position after a lengthy investigation.
The selection process for the CEO is taking place under cloudy circumstances. To trim expenses, Everson indicated that he was going to have to lay off 3,000 employees at the national headquarters. The Board is in the midst of a newly revised charter which clarifies the roles of the executive and board and eliminates over half of the board seats in a couple of years.
Times are a changing! The leadership of one of America’s stalwart agencies has a challenge as it has never had before. Hopefully the decision-making will result in better results.
A lot of people are watching.
Gary Snyder is the author of Nonprofits: On the Brink and articles in numerous publications. His website: www.garyrsnyder.com. He can be reached at 248.324.3700
Labels: American Red Cross
posted by Gary at
3:11 PM
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