Nonprofit Board Scandals: Let Them Move Governance Forward
The nonprofit board scandals of the past year are highly distressing: revealing everything from complete board dysfunction in the firing of the CEO at the University of Virginia, to the cover-up of criminal behavior at Penn State, to policy decisions that arguably destroyed Komen's leading nonprofit brand. In all three cases, the financial and reputational losses are quite severe. People to be served by the mission and outsiders have been harmed, the victims at Penn State devastatingly so.
However, the fact that these boards and organizations have been raked through the coals, including being investigated, analyzed and heavily criticized by experts, the media and the public -- day after day -- is a sign of progress. The lessons are out there for all to behold.
You might wonder why I call this "progress." For those of us who have worked with boards for more than two decades, board dysfunction is unfortunately not new. In fact, how can boards possibly be high functioning when so many are so large that they are composed of dozens of people, many of whom never even appear for meetings? Even board cover-ups have not been rare enough; they've just been more effective than they are today. What is new is today's level of accountability and transparency.