Not-for-profit (NFP) organizations are justifiably taking a hit right now. In addition to the poor economy, some have made some absolutely horrendous decisions that haven’t just jumped up to bite them, but have, instead, turned around and chewed off an arm.
Part of this is due to the individuals involved. Many executive directors, especially after they’ve been in a position for a while, come up with a sense of entitlement that you don’t often see in other entities. This is especially true in faith-based organizations, especially when they become the “family business” and the first generation of protagonists begin to give way to their children and grandchildren who take over operations.
Mind you, I have no objection to hiring the kids. It’s a tough market out there, and there aren’t a lot of jobs for high school or college kids to fill. It’s when they move up from stuffing envelopes to positions of responsibility and the “faith” part of the entity begins to take a considerable back seat to the “business” part that problems begin to occur.
One only needs to look at the Billy Graham Industries to see a perfect example of this. Let me start by saying that I have a great deal of respect for Billy Graham individually. I may disagree with his religion and his politics, but he started and grew a business that employees a lot of people and did a lot of good work. Initially, his organization was very transparent and he and Ruth lived an extremely modest lifestyle.
For the last few years, though, given Billy’s advanced age and declining health it’s been operated by son Franklin, who’s twice the businessman that Billy ever thought about being. He must be, because until he was exposed by a charity watchdog group, he held down the equivalent of two full-time positions, each with salaries beyond half a million dollars. When confronted about it in the newspapers, he asked the Board of Directors to reduce his salary to zero for one of the entities, saying, “. . . it’s just not worth it.”
This happened just a few weeks after these organizations laid off dozens of rank-and-file employees, citing declining revenues and economic necessity as the reason. Assuming a $40k salary for these individuals, at least a dozen of them could still be employed if it were not for Franklin Graham’s actions.
The problem with this kind of double-dipping in the NFP world, of course, is that it’s not like a hardware or grocery store, where you’re exchanging goods and services for fees. Instead, the entity is asking the public to give money to be used to either further the goals of the organization or to benefit some third party. There may not be a tangible product to which you can point as having been produced or distributed.
If I give money to be used to feed orphans, I expect that some part of that will go to pay for stamps and stationary and shipping and the administrative people that see that things get done. I probably don’t expect to be funding a new Lexus for those people, though, or book-match walnut paneling in a corner office of a high rise office building. That’s part of the social contract that’s implicit, if not explicit, in the transaction between the donor and the recipient organization. When excessive amounts of the income don’t go to provide the benefits intended, but instead provide excessive perks and an over-the-top lifestyle for the individuals charged with fiduciary responsibility for the organization, it’s time to look at problems within the system.
Part of the problem comes with the faux-religiosity associated with many of these entities. It’s fine to have a moral compass that guides your actions. It’s important to make sure you don’t have the magnet of money throwing off the readings. That, unfortunately, is one of the big problems that Franklin Graham is confronting right now and it may be the downfall of this institution.
Organizations that claim a base in religion are even more accountable than other NFP entities. They are combining their “good works” with proselytizing of their beliefs which almost always have a moral element related to honesty and integrity. When it comes out that their execs have their hand in the cookie jar, not only is their particular organization harmed but all faith based entities bear the brunt of their indiscretions.
I am suspicious of any individual or organization that has either religious symbols or bible verses printed on their business cards or stationary, not because I am necessarily anti-religious, but rather because my experience teaches me that anyone who has to TELL you how religious he is probably wants to use that as a cover to keep you from SEEING how he or she doesn’t necessarily apply those principals to their lives and business transactions.
The argument of a “sacred calling” with regards to individuals leading these organizations tends to start to fall short after the 2nd generation or so, as well. While one of the 12 Tribes of Israel may have had religion as the family business into which sons followed fathers, you seldom see that in modern churches or religious groups, and skepticism grows when we get to the 3rd and subsequent generations. Too many preacher’s kids, choked down by the expectations of their families and the congregations that the parent pastors, run far away from the seminary as a career path and when they come back to the fold it’s primarily because they see the easy money to be made. I note that Billy Graham’s children and grandchildren are now fully employed in the religious business and can’t help but be a bit cynical.
In a typical family business, adult children are frequently employed. After all, if you’ve got a deadbeat child who can’t hold a job, and if the business is large enough to support it, eventually the kid will be hired in the home office. If this does nothing else, it will get mom to stop nagging dad and quit worrying about how Junior is going to pay his bills. If they’re going to finance poor choices anyhow, they may as well try to get some return on their investment by putting him to work. Over time, hopefully, the kid will pick up some life skills that let them advance and begin to take more responsibility in the organization, maybe even pulling their own weight. If not, well, Junior’s probably impacting no one but the family, who are making those choices with their own assets. It wouldn’t matter if it’s a grocery store, a dry cleaners, or any other business.
The difference between the deadbeat kid working in the family dry cleaning business and working in a religiously based not-for-profit organization is that people remember where you came from. If the son embezzles money from the dry cleaners, people remember and think, “Well, he was a wild kid. His dad should have known better than to trust him.” The company lives or dies and it’s of no more consequence to the community than the existence of any other business.
If he’s a pastor of a multi-million dollar TAX EXEMPT not-for-profit organization, though, lots of people are impacted. Donations are cut off immediately – after all, unlike the grocery store, we don’t have to make charitable donations. That is soundly within the realm of discretionary income for most people, and there are usually other causes which most individuals could or would support with those funds. Even if they want to stay within a particular religiously based entity, it’s usually possible to find something else that has a similar mission without the taint. It’s also easier than changing dry cleaners, because the purchaser / donor has no direct tangible return for their actions; the warm fuzzies we get from doing good things don’t have to emanate from a particular source; they come from the universe at large.
The thing that Franklin Graham and so many other executive directors has failed to recognize is that he is constantly under scrutiny, and has an obligation to be above reproach. Politicians and captains of industry may be excused their indiscretions, because there isn’t necessarily a moral component to their professions (although I do admit a particular delight in discovering yet another conservative pundit or politician who has decried his righteous indignation at some liberal who’s engaged in a dalliance of one sort or another and is then caught, sometimes quite literally, with his pants down).
I admit that I have no personal stake in Franklin’s actions. I don’t agree with either the religious position or the politics of Billy Graham Industries, and my charitable dollars don’t go there. My indignation comes from knowing how many elderly people especially, thinking they are doing good to help provide those truly in need have basic hygiene, education, or the other necessities of life, continue to donate to keep this type of hypocritical activity going. If this is a calling rather than merely a career path, it would appear that Franklin is a wrong number.
Integrity is defined as many things. One easy to remember standard, though, is that it’s a matter of simply doing the right thing when no one is watching. Laying off dozens of employees because of declining revenues while keeping not one but TWO jobs which provide total compensation of over $1.2 million annually is never the right thing, but it’s especially not the right thing in an economy that is causing more and more people’s hopes and dreams to be crushed through no particular fault of their own.
One has to wonder what Billy would think, were he able to understand the shame his son has brought upon him.
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