Boards

Maybe I Should Have Held Out For A House, Too

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For Purpose Law Group posted the second installment of their “Nonprofits: What Not To Do,” series yesterday. The first installment dealt with the infamous Indianapolis Museum of Art job posting for a director who would help the organization continue to serve its “core white audience,” along with some other questionable decisions organizations have made.

This most recent post deals with creating prudent safeguards in executive compensation practices. It put me in mind of Drew McManus’ annual Orchestra Compensation Reports series which examines compensation for concert masters, music directors and executives.

In the most recent posting by For Purpose, they discuss how the board of the Brooklyn Academy of Music (BAM) wanted their new executive director to live closer to the facility than Manhattan and so offered a housing bonus of $968,000 so she could purchase a home nearby. This being NYC real estate, the bonus only covered half the cost of the house, but it is still a pretty dang good down payment. Since there were no provisions made regarding the house or repayment of the bonus should the executive director resign or be fired, when she did leave the organization six years later, she retained the house.

While the previous executive director being with the organization for 36 years, 16 as executive director, may have created high expectations for the new exec’s longevity in the mind of the board members, For Purpose writes the board should considered that eventuality.

Not to mention that knowledge of such preferential arrangements can impact morale among other staff in the organization, something the pandemic only exacerbated at BAM:

This scrutiny has also arisen amidst the background of severe fiscal carnage due to the pandemic; BAM lost millions. It had to “cease live programming, lay off or furlough staff and dip into endowments.”

And there was staff grumbling all along. “To be in an all-staff meeting where we were hearing so much about capital projects and how grateful Katy was to be able to walk to work was very disheartening,” said a former education coordinator. “It made a lot of us question the austerity we saw in other parts of the institution.”

It is likely that CEO compensation practices in the commercial sector influenced the board of an organization based in a world financial capital. However, there are different standards and levels of scrutiny accorded to non-profit orgs. The For Purpose Law article lists a number of resources boards can use to establish compensation standards. If you have questions, pop over and take a look.

Time To Review – To Whom Are You Accountable?

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During the Covid pandemic there has been a fair bit of introspection and soul searching about arts and culture, the role they should have in people’s lives, and the medium through which the experience should be delivered.

Now that there is some optimism about a transition to a relatively better operational environment for businesses and other organizations,  (Yes, i am indeed taking pains not to use terms like “return to normal”), it is definitely time to think about how those theories will be manifested.

Vu Le linked to an important essay by Hildy Gottlieb addressing the question of to whom non-profits should be accountable. Her primary thesis is that it is illogical to view the organization as accountable to funders & donors. She dissects the illogic of the implications of a funder accountable position. Among her best examples is the following:

If organizations are primarily accountable to donors, and a donor dies, is the organization still accountable to that person? What if it’s been 30 years since they died, and the world has changed dramatically — are you still accountable to that person’s wishes? Or are you accountable to their heirs? What if the heirs don’t care about your mission — perhaps their mother was an animal lover, and they could never understand that part of her. Maybe they even hate your organization. Are you accountable to the second and third generations of a donor who loved you, even if her heirs do not?

Gottlieb says the organizational mission determines to whom you are accountable. If your mission is serving a certain group, but they take a backseat to funders, then you are not fulfilling your mission. She addresses the concept of there being no mission to execute without the money with the following anecdote:

I once found myself in conversation with board members from a federally funded health center, who all listed patient health as their highest priority. However, one board member kept insisting, “We can only prioritize patient care to the extent we have the money to do so.”

So I took a sheet of paper and wrote “Values Statement’ at the top. Then I wrote, “Our primary focus will always be the health of our patients, as long as we have the money to do so.” I asked if that is what they would like to post in their lobby.

Suddenly their sense of accountability shifted.

She also notes that in the United States the organization has tax-exempt status in return for providing a public service. The reason for being and accountability is the public service and not the money. The “good stewardship” of funds that results in underpaid staff who turn over at a high rate doesn’t help the organization to advance it’s mission.

“Focusing their primary accountability on the money, we see board members spend a huge percentage of their time discussing financial matters, and often zero time discussing what success would look like in their community”

Gottlieb also debunks the sense that fundraising is a result of relationship building, the oft voice sentiment “people give to people, not organizations.” She says no one is fooled that the relationship is more than a transactional one:

Here is what “fundraising is about relationships” really tells a donor:

If you give us money, we will be your friend.
If we think you will give us money, we will court you as our friend.
The more money you give us, the more friendly we will be.
If you fail to give us money, we will eventually stop calling you.

If we truly valued donors as people, we would stop categorizing them as LYBUNTs and SYBUNTs.

So much of what she writes can easily be applied to the way arts and cultural organizations approach donors/members/volunteers. While I often say it is worthwhile to read an article, I strongly emphasize the importance of reading this one and thinking about how the opportunity for a fresh start will change the way your organization operates moving forward.

I was considering putting such an emphatic statement at the beginning of this post, but considered that anyone who read this far would be more prepared to make the effort toward this goal.

I strongly suspect being more steadfast in prioritizing mission over money will make accomplishing progress in areas of equity and inclusion suddenly much easier than it was before.

What Does It Mean To Have Influence

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I saw an article containing an interview with choreographer Robert Moses that basically opens with Moses saying the conversations occurring regarding equity are addressing the wrong questions.

How to increase equity? “Ask different questions,” is the reply from Moses. Or preferably, don’t ask the same tiresome questions.

“The notion of change is sophomoric,” Moses says. “The idea is to give people honest opportunity to be part of whatever they’re intending to be a part of. The questions get tiresome because they come from the same place. It’s not interesting if it doesn’t have anything to do with what needs to happen.”

Moses poses a question of his own: “Should we have more representation? No, we should have more influence. More actual ability to exercise that influence and power. All those things will be happening for the better of everyone,” he says, heavily emphasizing the “everyone” in his declaration. “It has to be in as many hands as possible… It’s about talk that’s useful. An organization that powers those things is what I care about. The conversations then can take place that move us all. We’re not spinning our wheels and using portions of a cultural experience to affix something to the moment.

I’m not exactly sure I completely understand what he means. Which is good I guess, because if I thought I knew what he meant, I might stop considering the larger implications of the statement.

If influence and power in as many hands as possible isn’t more representation, what is it? It is obvious that representation can be employed superficially, but so too can pursuing talk and conversations that is useful. Often both can feel like progress when they are just the appearance of progress. So isn’t productive work in representation and/or conversation valuable?

The distinguishing element that sticks out to me is the mention of “…using portions of a cultural experience to affix something to the moment.” That seems to reproach focusing on creating standards based on conditions at a specific time versus embracing broader, long term goals. For example, the idea that you are done when the composition of your board reflects the demographics of the community versus the broader goal of seeking to create an environment where power and influence are shared in the broadest terms possible.

Anyone else want to share their thoughts?

What Do You Perceive As Biggest Impediment to Equity Efforts?

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Advisory Board for the Arts had sent out a survey on Diversity, Equity, Inclusion and Access (DEI&A) efforts that non-profit organizations were undertaking. They released the results in infographic form this week.

Keeping in mind that the respondents were self-selected so there wasn’t a lot of rigor behind the process, the results are still an interesting preliminary view of what organizations perceive is going on with their efforts.

I was particularly interested in the pressures and challenges section where respondents indicated there was a lot of pressure to do more in relation to DEI&A across a number of internal and external constituencies. The biggest perceived source of pressure to do less is among board members and individual donors. Still there wasn’t perceived pressure either way from unions, donors, corporate sponsors, and audience members.

This all makes me yearn for a more complete study of the question. My suspicion is that groups who were already very interested in implementing DEI&A chose to answer the survey and so they were either inclined to view their efforts favorably or their constituencies were aligned toward DEI&A efforts to begin with.

However, it would be great if these results were close to reality because that would mean the impediment to change couldn’t necessarily be blamed on external groups. They are shown as largely indifferent in this area. Even board members who were seen as most in opposition to DEI&A efforts were more likely to be for or indifferent to them rather than against.

In terms of challenges and hurdles, the survey found that developing an authentic, rather than performative, stance and creating meaningful metrics to hold the organizational accountable were among the top concerns people had.

Stuff to ponder so take a look.