This is the most innovative idea I’ve heard to date for modifying the nonprofit model to better suit organizations which aren’t properly “charities” but still serve the public interest.  The conversation has been about theater companies–and I salute Stolen Chair’s leadership for introducing it–but it would work equally well for the newspaper business, where very little else seems to work.  The Nonprofiteer promptly and shamelessly cribbed the idea for a “Whither journalism?” discussion, and intends to do so again.

H/t to Thomas Cott of “You’ve Cott Mail” for passing along the Artful Manager’s coverage of this intriguing concept–the first notion in many a day to tempt the Nonprofiteer out of her lair.

Dear Nonprofiteer,

I am wondering if you can help.  I recently made a film about the efforts of a group of villagers in the developing world to find a means of support after their livelihoods were taken away by misguided government actions.

I am getting requests from people who want to donate money to the village after seeing the film, but there are currently no charities that specifically cater to the village and I know it takes a long time to start one.   Are there any charities where you can specifically earmark donations for a purpose and manage how that money is used? Kind of as a sub charity?

I just don’t want the money going to some big non-profit organization where by the time it gets to the village it has been depleted by other things.  There is a very big church in the village which might want donations to go to them, but I don’t believe that’s what’s best for the village, either. What do you advise?

Signed,

Avenue for Aid

Dear Avenue:

Though you’ve described a very particular set of circumstances, you’re asking a question of general interest: how to make sure that donated money gets to its intended beneficiaries. Often the correct answer to that question is, you can’t–and that’s a good thing. People gave oodles of money to relieve the suffering of the victims of September 11, but once that suffering was relieved and there was still a ton of money left over, the Nonprofiteer approves of its being used by the Red Cross to relieve other kinds of suffering, rather than its being used to enrich the intended beneficiaries. In any event, the price we pay for having experienced professional suffering-relievers on the ground when we need them is to pay their salaries and the light bills and rent of the people who send them there–and to pay all those overhead expenses year-round, not just when disaster strikes.

But you’ve described a case where very tightly targeted aid is available and makes sense, yet there’s no recognized pipeline from donors to recipients. Each country has its own unique way of handling charity, and even if you set up a recognized US charity it might not meet the necessary requirements for transmission and distribution of funds in Africa or Asia.

So your first step should be to get the lay of the land from the aid groups that know it best. Start with UNICEF or CARE: they’re certainly the least corrupt and most able people on the ground.  UNICEF has a presence in virtually every country on the globe, working closely with local groups, and its office staff should be able to get to the in-country people and find out what systems would work for targeting your aid. Yes, of course, they’re likely to say, “Give to UNICEF [or CARE] and we’ll guarantee the aid will go to your country of choice,” and they actually will–but that won’t increase the total money allocated to that country by the agency. It will just substitute your money for some other money that hasn’t been so designated, with no net increase in welfare for the country. Nor would an increase in country funding help you support this particular group of villagers.

So you probably need to suck it up and tell people you’re happy to accept their contributions, but that they’re NOT tax deductible. They can send the money to you (or to a bank fund you set up, if that makes them more comfortable: establish the Village Rescue Fund at First National Bank, and the bank has a fiduciary obligation to keep the money separate and to remit it in accordance with the purpose you describe when you set up the account), and then you can send it to your contact(s) in the village for distribution as they see fit. 

You won’t get to oversee it once it’s in the hands of people in the village, but you wouldn’t really want to: the point is to assist them in restoring their economic self-sufficiency, right? So concede them their autonomy. The last decision you get to make is to send it to your friend John instead of to the head of the local church; it’s hands-off from there.

If people are very moved by the film, the lack of a tax deduction (which is all that you lose by giving money to someone or -thing that isn’t a nonprofit) shouldn’t deter them from giving. Best of luck, and let us know if you find a better mechanism than the ones described here.

The Nonprofiteer received this note from the soon-to-be-ex-Executive Director of the Guild Complex, a Chicago nonprofit focused on highlighting and diversifying contemporary writing. It’s the strongest possible statement about what one dedicated and capable person can accomplish in nonprofit management–and about when and how it’s time to let go. Thanks to Ellen Placey Wadey for her kind permission to edit and reprint it.

September 10, 2009

I think that we can agree that birthdays are moments of reflection. Mine is tomorrow. . . .

When your birthday is September 11, you can’t help but pause a bit. I turned 40 on that fateful day of the Twin Towers attacks . . . . I realized then that aging is a privilege that not everyone gets. I’ve come to embrace that realization in the time since to mean that every year should count. After wonderful years of success and accomplishment, even after very difficult years–we’ve all had them–a birthday gives you the chance to turn the corner and look to the next bright moment.

So, it felt right for me to announce today–on the eve of my birthday, on the eve of the possibility for the next bright moment–that I will conclude my tenure at the Guild Complex on December 31, 2009 (yet another date for reflection and also my 15th wedding anniversary.)

My transition from the Guild Complex has been in the works for the past year. Personally, I don’t believe an executive director should be in place for more than a decade–particularly for very small organizations. You run the danger of creating too much dependency on one person. A healthy organization, like a healthy person, should not only endure but embrace change. For a small non-profit, the healthiest scenario is that any one person can step away–a director, a key board member–and the organization moves forward with strength because the mission is greater than any one person.

When I look back at what I set out to do at the Guild Complex in comparison to what has been accomplished over these eight years, I’m content that much of the ‘to-do’ list has happened or is in process. Some times it’s hard to see it from the outside–nobody revels in your neatly organized closet but you–but we’ve done a lot at the Guild Complex. We updated our mission, our logo and our website. We made the transition into electronic marketing and audio archiving. We established on-going performance venues that serve important neighborhoods such as Pilsen and Humboldt Park. And we accomplished the two most important things for me on the list. We rethought our programs and launched fresh efforts that not only continue our legacy but are leading edge in the promotion of under-represented poets and writers. I’m particularly proud that Palabra Pura and the Poetry Performance Incubator were inaugurated during my tenure. And, we’ve brought on six amazingly talented, charismatic, smart and energetic new board members. The Guild Complex has always been supported by a close-knit group of people, but I wanted to make sure that we made room at the table for new voices and new ideas and that we continued to make that a priority. With the recruitment and robust involvement of these new board members, we have turned that corner too.

Though I will no longer be executive director, I will always be the Guild Complex’s biggest fan. I was a part of the organization years before my time on staff, and I expect to be a part of it for many years to come. But, my role from 2010 forward will be to cheer from the bleachers and offer my assistance to the new managing director the best that I can–but only when asked. (No new coach likes the old coach looking over their shoulder.)

As for me . . . . I’d like to work with non-profits on a project basis. I’ve developed a breadth of knowledge in my 15+ years working at grassroots, heart-and-moxie-driven organizations, and I would like to continue to contribute to this important sector, especially in the face of upcoming challenges to the arts.

. . . . There are not enough words of appreciation to extend to all those who have supported the Guild Complex and me over these last eight years. Artists have plenty of fire and passion, and they are also a generous bunch through and through. I thank each of you so very much.

. . . . So, here we stand–the Guild Complex and me–leaning over the birthday cake. I feel very honored to have worked at a place that I love so much. These next steps will be exciting, and a little scary, but I trust in the next bright moment.

With all gratitude and affection,
Ellen

Dear Nonprofiteer,

I am just finishing a year as an ED for a small nonprofit arts organization which has been struggling for almost all of its 30 year history. We have a 2-person admin team and most things seem to fall to me–from grant writing to plumbing.

While we have met our challenges this year and will not go into the red, I have not been able to realize the high hopes that I started this job with last September.

We face the challenge of an old, crumbling and uncomfortable building. We have a board-–of people I personally like–which is resistant to fundraising responsibility but eager to micro-manage small details. I have tried hard to develop a grant campaign but found no funders willing to support our projects. So we limp along on tuition revenue–enough to secure breakeven but not enough to undertake new initiatives.

I try to keep telling myself that this is the way of things in this economy but I am becoming very depressed and am having a hard time getting myself motivated this fall. I am not in a position to walk away from this job and as an older woman in this job market I am not optimistic about other prospects.

And more whining – my office is a broom closet.

Any advice?

Signed, Depressed in the Dumps

Dear Depressed:

The situation you describe is serious but not hopeless. It only feels hopeless because you’re probably trying to solve all the organization’s problems at once, when they need to be solved step by step. The central problem you identify is the Board–for without its fundraising support, you’ll never be able to expand, or repair your building, or get out of the broom closet.

Sit down with your Board president and explain, in the straightforward terms you’ve done here, that the only reasonable source of expansion capital for the group is the Board of Directors and that this Board of Directors seems unwilling to answer your urgent calls for its participation. Propose two things: that you and the President get the Board engaged in a serious effort at recruiting new and motivated Board members, and that once you complete this effort (which should be doable in about 3 months) you conduct a training session for new and veteran Board members alike in which they will learn to ask for money. If the President agrees (and there’s no reason why s/he shouldn’t), this will give the Board something to do that will keep it from micromanaging you AND will result in a new focus on fundraising, even before the current members have been trained to do that work themselves. Most Boards–and most EDs–find the process of brainstorming about new recruits and then conducting recruitment breakfasts or lunches or dinners or midnight snacks an exhilarating one, and it sounds as though a bit of exhilaration wouldn’t come amiss right now.

Once you’ve set this in motion, stop pounding your head against the wall with general-purpose grant applications and go looking for funders who will pay for “capacity building,” a phrase encompassing everything from updating your computer system to teaching your Board how to do its job. Ask for money to hire a Board development consultant, and use that person to help push the Board through the recruitment process or to give them training or both. Your grant proposal should stress that the function of this activity is to enable you to reduce your dependence on grants in the future; this goes over big with people whose job it is to give out grants, contradictory as that may seem.

Finally, consider the possibility of framing this entire project as a prelude to a campaign to improve or replace the building. These are terrible times for capital campaigns, and your Board will figure that out soon enough; but they’ll be more excited about expanding their number, and more expansive in their thinking about who in the community should join them, if they think there’s a possibility someone will want to put a name to a bricks-and-mortar project. You can always disabuse them of this notion later–or, if you don’t, maybe they’ll become properly agitated about the condition of your “office.”

If there is anyplace else in the building your desk can be placed, move there now–being in a windowless space makes everything seem darker, both literally and figuratively, than it actually is. You’re the ED–pull rank and choose someplace better to sit. “Better” may be a term of art meaning “loathesome instead of positively grotesque,” but at this point a change is as good as a feast.

And if all the foregoing sounds exhausting rather than energizing, then do two more things: take a week off NOW and spend it sitting in a bubble bath or hiking through autumn leaves and not thinking about this place at all; and then come back and use the computer in your broom closet to start job-hunting. It’s a bad economy and older women do face discrimination in the workplace, but you’ll be able to find small arts organizations with better attitudes and atmospheres which will be thrilled to have you. You’ll also be able to find large arts organizations whose development, marketing and education departments could all use someone with your background–and which won’t expect you to fix the toilet.

Finally, please try to remember what made you take the job in the first place. If you love this art form, see if you can’t get back in touch with that fact and with the way that working for this agency contributes to the art form’s growth. If you don’t love the form–if you took the job because it was a job, or because you love “the arts” and figured any one was as good as any other–then this is never going to satisfy you, no matter how well-restored the building or cooperative your Board or spacious your office. Conversely, if this kind of artistic work is the love of your life, then you’ll fix toilets and make coffee and browbeat Board members to make sure it thrives.

Check in and let us all know how things go for you.

Dear Nonprofiteer:

For the last year I have been hovering near the Board of a small startup nonprofit I respect.  I started as a donor, and I think I was about to be invited into the boardroom.  Now our dealings are stalled, if not worse, and I don’t know what to do.

I learned about the organization two years ago from an old, somewhat close friend who had been doing some consulting work for it.  I’d agreed with her when she spoke excitedly about its activities.

Now she has been fired, or she’s quit; I can’t tell.  All ties severed.  She’s playing the cool professional in a shtick I find irksome: “Let’s just say it was mutual consent and I wish them all the best.”  Okay, I said, but do you have confidence in the leadership?   Is there anything I need to know?  “Look, I’d rather not talk about  it,” she said.

For its part, the organization (I mean its current ED and the board chair) hasn’t been in contact with me lately the way it had been.  It’s the summer, I tell myself; they’ll get back in gear soon.  But maybe I too have been fired.

I still respect the outfit–what I know of it, its mission and accomplishments.  And I don’t think my friend will mind if I stay involved.  What does the correct semi-outsider do in these circumstances?

Signed, One Foot In

Dear Foot:

When a consultant mutters about mutual decisions and best wishes, the translation is ‘AVOID!  AVOID!  COMPLETE DISASTER AHEAD!”  If the organization has decided to let you alone, count it as one of your blessings.

Less glibly: the most likely reason a consultant would leave a paying gig is that she discovered something improper or unethical, pointed it out as something that needed cleaning up, and encountered a stone wall.  Whether it’s mis-, mal- or non-feasance, it’s not something a professional wants to be anywhere near.  Nor is it something you would want to be involved in as a Board member.

Could you join the Board and turn it around?  Maybe.  But as a newcomer, and without your inside contact, you’d have less leverage in insisting on a clean-up of whatever needs cleaning up, and/or bringing in new blood (in the form of other new Board members) to wash the infection away.

What might be the problem?  The list is long, but with start-ups one common difficulty is that they’re not actually charities at all.  Perhaps they’re secretly profit-making entities for the founding Board; perhaps they’re tax shelters.  But not every organization that gets a preliminary ruling from the IRS should actually be considered a tax-exempt charity, and your friend might have discovered this sort of foundational issue.

Practically the least serious reason for a consultant to walk is that she hasn’t been paid.  But if this is the kind of organization that doesn’t pay its bills, again, I think you should count yourself lucky if it’s passing you by.

If you’re determined, though, to make this your experience of Board service, there’s no reason for you to be shy: after all, you’re a volunteer offering your services, not a supplicant begging for a job.  Pick up the phone and call the Executive Director and say, “I’d gathered you were recruiting me for the Board: was that correct?  I’m still interested in serving.”  No point in beating around the bush: listen to her answer, and if she’s at all evasive or indefinite about when she might want your services, then you’ll know it’s time to walk away.

It’s frustrating to have invested time in an agency with the expectation of being promoted to the Board, and then have that expectation frustrated.  But better that than the long-term frustration of serving on the Board of an agency whose integrity is in serious question.

____

*Apologies to Stevie Wonder.

Gentle readers: The Nonprofiteer is in reactive mode. As long as you keep sending her these requests for advice, she’ll keep answering them.

Dear Nonprofiteer,

The “beloved” ED of our nonprofit agency is retiring for health reasons after 3 decades. As his longtime 2^nd in command I felt quite qualified and planned to apply for his position. I met individually with other staff members to let them know my intentions and to listen to their thoughts about my trying to replace the only boss the agency has ever had.

The ED found out I had talked to other staff members. He was VERY angry with me and said he was recommending someone else from outside the agency (who I later found out was an old friend of his). He warned me not to attempt to politic with staff or Board for the position. Though I disagreed with him, I complied because I hoped for his blessing in my attempt to move up. I reminded him how the agency had grown threefold since he hired me, and said perhaps it had something to do with my leadership as well. He replied that I was as welcome to apply as anyone else, but left me feeling that it was futile.

He had been allowed to remain as CEO for the past several years despite being hospitalized for months at a time. He never chose, nor did the Board require him, to name an interim director. (He apparently convinced them he could manage just fine via email or phone.) In effect, he was being paid to be on medical leave, coming into work about 3 or 4 days each month, and some months not at all.

During the time he was out sick, I strongly considered leaving the agency over what I considered to be preferential treatment. Eventually I became so concerned about the impact of this CEO neglect that I contacted a Board member I trusted. I told her that the boss’s being absent and receiving full pay didn’t sit well with me and others in the agency. This Board member said she too had considered resigning over this. I said I wasn’t asking her to take any action but just to be aware that if the agency started crumbling, I shouldn’t be the fall guy (I expected the ED might try to make me that, as he is quite adept at assigning fault elsewhere).

To get to the point: I still applied for the position, and was selected for an interview along with two external candidates, one of whom was the ED’s recommended hire. I received a “polite” interview, without a single tough or probing question. During the interview I considered relating my concerns about bullying behavior, preferential treatment, and ethical issues, including whether the ED had made a deal with his friend for continued consulting fees and whether his plan to stay on as CEO of one of our subsidiaries would provide him with unnecessary compensation. I was concerned, though, that to bring this up would make me appear to be tearing him down to get his job. So I kept the interview positive, hoping my loyalty and commitment might still somehow still override the ED’s recommendation. But as I expected, I was not hired and the ED’s friend was.

I waited a week to get over my disappointment, but my ethical concerns just would not go away. The Board member I had spoken with earlier emailed me a note of support, but I could sense she was politically outnumbered. In addition, I fully realized the other candidate was also very qualified and had been politicked for months by the ED.

Nonetheless I replied to the Board member, sharing with her more details of my concerns, including what it had been like trying to keep the agency together with no real leadership during the CEO’s extended sick leave. I never accused the CEO or Board of doing anything illegal, just listed my ethical and behavioral concerns. I also stated that, despite my disappointment, I agreed to support the new CEO as long as I felt this person was indeed ethical. I passed this on more to clear my conscience than to attack anyone.

I also know that I have NEVER been insubordinate to the ED. I’ve done everything I’ve been asked and with a high degree of quality I might add and have received nothing but top notch performance evaluations in all my years.

The Board member was going to recommend that the Board president meet with me personally. That was 3 days ago, and I’ve yet to hear from anyone. I expect they are either afraid to talk to me, or they may be planning to fire me for all I know. The last thing I wanted was to appear I was bringing all this up out of bitterness for not being hired but I’m afraid that is how it might be perceived now.

Any advice about this situation? Did I act properly? Do I have legal protection against retaliation?

Signed,

In It Up to My Eyeballs

Dear Eyeballs,

If you don’t consider it insubordinate to go to one of your boss’s bosses and describe him as an unethical waste of space on a crowded planet, we must have different definitions of the term. However, insubordination is often a useful characteristic in agencies where people are nice at the expense of being effective or ethical, and yours might be one of those.

Dear Nonprofiteer,

Help! I’m the new-ish ED of an organization that serves victims of intimate violence. Our bylaws require that a certain percentage of the board identify as female. I get this, and am completely supportive of it; I believe that the board composition reflects the values of the organization and its leadership, and the organization’s understanding of the world. Problem: the board pres doesn’t get it, and isn’t happy about it, and wants to remove it from the bylaws because she thinks gender has nothing to do with good governance.

For this and a couple of other reasons, I am finding myself looking at being the director of an organization whose board seems to have different values than I signed on for. I came to the organization completely inspired by its anti-oppression, progressive voice for survivors of violence- it was edgy, pushed the boundaries, had a very diverse board, etc. I am finding that through board turnover, and a board recruitment process that had excluded me, we have a more conservative, homogenous, and less connected-to-the-issue board.

I know I have an important role in board development, and the recruitment process does now include me, but I feel like it’s too late–not to mention that I don’t feel like I have the internal or external resources, support or mandate to change board members’ values and worldview to become more in line with what I understood to be the organization’s philosophy.

I know I am framing the issue as a no-win, but I can’t see out of this. Whew. Do I have to find a new job? What about the tragedy of this organization becoming a cookie-cutter social service agency, instead of an instrument of social change?

Signed,

Disappointed

Dear Disappointed:

Whether that’s a tragedy or not depends on whether your community is in need of a social service agency that serves victims of intimate partner violence. But I take your point: you signed on to make change and instead you’re simply providing services.

If the question were just the one about women on the Board, I would suggest that you sit down with your Board president and spell out to her as you’ve done to me the way in which having a certain percentage of Board members identified as female makes for better governance of the institution. It’s easy to say she “doesn’t get it,” but it’s also exclusionary and snobbish: if fostering social change is an important part of your work, then you have to be prepared to spend time with lots of people who don’t get it–so that when you’re done with them, they do.

But if as you suggest it’s a broader problem–that now you’re surrounded by people unsympathetic to your goals–you have two choices: you can throw up your hands, or you can help those people enlarge their perspectives. That’s an often-overlooked part of Board development: educating Board members after you’ve recruited them. Can you and your Board president agree that the subject of how social change intersects with social services is important enough to the Board’s governing competence to warrant a thorough conversation?

In other words: you only have to leave this group if you’re not willing to do the work of orienting and persuading people who’ve joined its Board in good faith and probably have no idea that there’s anything wrong with being “a cookie-cutter social service agency. ” If you can make them see that there is, and that there’s something more the group should be doing, you can stay.

Otherwise: the Board always wins. Find yourself a different job.

The Nonprofiteer was once hired to run an agency which she understood one way, the Board understood a different way, the staff understood a third way and the clients a fourth way. The bad news was, she didn’t realize that, and spent all her time wondering why nobody seemed to get–that term again!–what she was trying to do.

You DO realize that, and that realization gives you the chance to shape the conversation about what the agency is doing, what it used to be doing, what it could be doing, and how the Board can contribute with more than just dollars and cents. Take the lead in setting up that conversation (though perhaps have the conversation itself facilitated by a neutral outsider), and see what progress you’re able to make. The worst that will happen is you’ll end up very clear that you need to go.

The Nonprofiteer could use a break, so she’s taking one.  Publication will resume when she feels refreshed, or whenever she gets a particularly intriguing “Where’s the Beef?” or “Dear Nonprofiteer” inquiry.

Meanwhile, please troll around in the archives or search your favorite topic and see what she’s had to say about them over the course of the past two years.  And to make sure you get the word the very second she starts making noise again, please subscribe by e-mail or RSS feed.

A happy and feckless spring to all.

Dear Nonprofiteer,

I’ve heard about the stimulus package, but where, exactly, is the money?

Signed, Hungry for My Share

Dear Hungry,

Check out the Foundation Center’s new map, which connects to a list of links and resources relevant to nonprofits seeking money from the American Recovery and Reinvestment Act.  Dig in!

ARRA–we do our part.