How Safe Is Your Organization?

In 2011 approximately 275,000 organizations automatically lost their tax-exempt status because they did not file legally required Internal Revenue Service annual reports for three consecutive years. While the IRS believes the vast majority of these organizations are defunct, a review of the Revocation of Exempt Organizations roster show a surprising number that are not–or at least didn’t intend to be.  Which gives rise to wondering who exactly is leading these organizations and why are they ignoring their fundamental responsibilities?

While it’s easy to dismiss revocation as an action of an out-of-control bureaucracy where complexity rules and common sense is an oxymoron, but that reaction truly misses the point.  Every leader has a foundational set of responsibilities that simply may not be ignored.  Ignoring them risks not only your own career, but in a broader sense the integrity of your profession.  We cannot expect those we lead to respect us, our decisions or our commands when we so blatantly and irresponsibly ignore our most fundamental obligations.

Working and serving with volunteer leaders and voluntary boards it is easy to understand the operational complexities and difficult choices volunteers face serving in these roles and sharing these responsibilities.  Understanding the real challenges facing members, being certain the association is maintaining its outward focus to serve those needs and assessing the effectiveness of it all, is definitely not for the casual observer nor feint of heart.

Still too many boards fumble while working to get it right.  The very nature of their voluntary service—part-time engagement, competing business and family obligations, limited meetings, ill-defined reporting schemes, ideological splinters, and limited or non-existent safeguards—all serve not only to increase the risks but limit the volunteer’s ability to garner perspective, glean incisive intelligence and truly understand just where the organization stands. One place to look is an ineffective or dysfunctional relationship with the chief staff executive.  What do Board’s want from their senior staff leaders?

Research by Tecker International identified four beliefs that volunteer boards want to have about their senior staff.  They want to know senior staff:

(a) Authentically value and appreciate what they do to earn a living
and genuinely like them as people;

(b) Place the needs and interests of the organization and its mission
over personal career goals;

(c) Are sufficiently familiar with the conditions of the organization
and its environment to help them understand what is going on; and

(d) Are sufficiently knowledgeable about the dynamics of associations
to give them good advice about choices in discussions of challenges
and opportunities.

It’s not just Boards.  Staff leaders have a critical role to play in building and sustaining mutual trust and respect.  Sadly, the stories of dishonesty, mis-direction and less than transparent reporting by trusted  leaders are commonplace today. (a rudimentary Google search will bring you over a half million hits)  Some deceptions are big and brash, like the saga of Bill Aramony at United Way.  Others are considerably smaller.  All serve to undermine the essential confidence in our tax exempt organizations and trust in those we call leaders.  So what do you do as a leader to assure greater success?

One place to start is revisiting the core standards of your chosen profession and engaging your team in discussions about just what they mean for your organization.  If your organization has a code of ethics or conflict of interest policies bring those to the table too.  If not, perhaps now is a good time to get started.  You can use the work of your industry, other associations, or the guidance of your legal counsel as a starting point.

ASAE: The Center for Association Leadership established a set of Core Ethical Standards to which it encourages its members to aspire:

  1. Respect and uphold public laws that govern one’s work;
  2. Be honest in conducting the member’s business;
  3. Respect the confidentiality of information gained through one’s work;
  4. Act fairly;
  5. Foster an ethical culture through one’s work; and
  6. Take responsibility for one’s conduct.

Rick Cohen writing in The Nonprofit Quarterly tells a story about a building inspector who agreed to wear a wire to help prosecutors catch a crooked developer.  He did it Cohen writes, “to stand up in his own individual way for governmental integrity, for the public interest.”

If you want to lead you must be prepared to “stand-up” every day for what’s right, what’s required and what’s essential for the progress and continuity of your organization.  Don’t let what you don’t know limit that.

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