A reader shared this story with me. Their reflections on what went wrong are great lessons for all board members. The ED went rogue out of arrogance. The Board Chair thought he personally managed the ED. The rest of the Board did not insist on transparency and oversight.
Overconfident ED, Self-Important Board Chair, Acquiescent Board Means Trouble
As told by a Board Member someplace in the US
I have been on many nonprofit boards over the years – mostly in one specific programmatic area where I have developed expertise. The situation I am about to describe was difficult. I often think back to what might have been done differently.
First, I live in a medium sized community and people all know each other – especially in this sector. I joined the board under the second ED of the organization. After two years on the board, I stepped up to Chair the Fund Development Committee which meant I would also be on the Executive Committee.
About a year later, the ED gave notice that she was moving on. She left the organization in a strong position – we had diverse funding and impactful and popular programs.
I was asked to be on the search committee for the new ED. I think it was because of my role as Fund Development Chair. We hired a search firm. We narrowed down to three finalist candidates and had them come in for interviews. There was one guy from out of town whom everyone else really liked. I will call him John. I had a strange feeling about John. Nothing I could put my finger on. Just something did not seem right. I shared this with the search firm, and they suggested I meet with all three candidates one-on-one. They noted that the new ED would have to do fundraising and meet with people individually so this would be an effective way to assess how they would act in that type of situation. I did this.
John was charming in this meeting. I felt we had an engaged conversation. In retrospect, I realized that John turned around all the questions I asked to be more about me than about him. Everyone is flattered when someone seems interested in you – and I am no different. I still preferred another candidate, but I changed my vote from “no” to “I can live with him if everyone else wants him.” So, we hired John.
Board Chair Acts Like ED’s Direct Manager
The Board Chair worked the most closely with John. He did the onboarding. I believe he set monthly and quarterly goals for the first year and was monitoring these with John. John was a brand new ED, though he had been in senior leadership of a similar organization out of town. But as a new ED, mentoring him was important. However, what the Chair actually did was pretty opaque. I never saw those goals or had reports on progress. I also did not ask for them – nor did anyone else on the board. I mostly interacted with John around fundraising, and I admit he was good with major donors. As I said, he made people feel good.
Hints of Problems Come from Staff
As Fund Development Chair, I worked closely with the Director of Development. After John had been on the job for about four months, at one of our regular meetings, she told me John had taken over the relationships for foundation and corporate grants. John did not think the grants had been negotiated well and wanted to redo them. He thought he could do better. Even though I was Chair of our Fund Development Committee, the board was not involved with large foundation or corporate grants. The previous ED and the Director of Development managed those. We had a contract grant writer and a staff person in Finance, who I also knew quite well and who monitored grants for compliance. The board was more focused on major donors and events.
I know that sometimes big foundations can make demands of nonprofits that are unreasonable such as not paying enough to cover operating costs associated with a grant, insisting on evaluation that is not paid for by the grant, or pushing the organization into “mission creep.” I assumed John was focused on things like that. I was actually pleased that he was on top of this. I did not ask what John thought should be renegotiated. I just assumed.
About a month later, the staff person in Finance who worked on grant compliance called me as Chair of Fund Development. I had known this person for years. He had worked at a previous organization where I had been on the board. He told me that John was using the money for three grants in ways that were out of compliance. According to the compliance person, when he brought this up to John, John replied that he was sure the funders would be okay because John knew more than they did. John said the compliance person should tell the funders to just trust him. This staff person wanted to make sure the board knew what was going on. The compliance person did not think the funders would be happy. I asked for details, thanked the staff person, and immediately called the Board Chair. I shared what I knew with the Board Chair who said he would investigate and get back to me. In retrospect, I should have told the compliance person to speak to the Board Chair directly – it was not good for me to be in the middle.
Evidence of a Problem Mounts
I did not hear back for many weeks but trusted that the Board Chair was on top of the issue. Then I attended a community event. I was seated next to the ED of another organization. I will call her Amy. I had served on the board of Amy’s organization until I had to leave because of term limits. But I got along really well with her. Her organization often partnered with the organization John was running. Amy sits down. We catch up a bit and then she says, “So hey what’s up with John at xx organization?” I asked what she meant. Amy told me that John went to all these coalition meetings, was rude to everyone, and bragged that he had renegotiated contracts with these big foundations. John was telling everyone that he was taking the organization in a totally different direction and that he knew more about the area than anyone else. Apparently, John was arrogant and offending everyone. I thanked Amy for sharing and told her I had no idea and would check into it.
As soon as the event was over, I called the Board Chair once again. I shared what I had heard and asked about what he had found out when he investigated the earlier information. The Board Chair assured me that everything was okay and that he had full confidence in John. I said I was worried and asked the Chair to do some more investigation. After another week, I did not hear back so I called the Board Chair. He said the same thing again. He had full confidence in John. He seemed really irritated with me.
Things Start Falling Apart
Then things heated up. John had been at the organization less than a year but more than six months. Two senior staff people resigned. I learned later that they sent letters to the Chair outlining their concerns and why they were leaving. But the Chair never shared this with the rest of us. One funder, realizing we were out of compliance, withdrew its funding. We had to return money – including some that was already sent. I asked the Board Chair again what was going on and he continued to support John. The Board Chair said something pretty negative about the funder. The Chair told me I was interfering, and it was not my role to be asking so many questions.
I was aggravated that I was not getting a good response from the Board Chair, so I wrote an email to the full Executive Committee, outlining what I had heard about John. We had an upcoming Executive Committee meeting, and I said I hoped to discuss these in Executive Session. I marked the email CONFIDENTIAL DO NOT FORWARD in the subject. The Chair immediately replied to my email and said that I was out of order and alarmist, that he had investigated, and that everything was okay. He also said that there was not time on the agenda of the upcoming meeting to discuss this matter. He was clearly annoyed with me. I was furious.
I got calls from two other people who were on the Executive Committee, and I shared what I had heard. They were both concerned. At the Executive Committee meeting, the Board Chair did not bring up the topic and ran the meeting in such a way that I did not have an opportunity to bring it up. The Board Chair actually skipped the Executive Session, saying we had too much else to do. I was anxious about what was going on.
Next the Director of Development called to tell me she was resigning. She said that John had started micromanaging people, reading their emails, looking at their calendars. He had instructed her not to meet with me – even though I was Chair of her committee and also a big donor!
So, I set up a meeting with John. I was the one who asked to meet with him. When I got there, he spent about 15 minutes with me before his administrative assistant interrupted us and said he had another meeting. I tried to ask him about his plans to replace the Development Director and other things that were appropriate for someone who was Chair of Fund Development. He was totally patronizing . He told me he had everything under control, and I did not need to worry about things. He said he knew what he was doing.
I was stressed and anxious. I did not know how to fix the situation. I was literally losing sleep over it. I worried about the organization.
Board Member Who Asks Questions Gets Pushed Out
The next day, I got a call from the Board Chair who said that John asked that someone else be appointed Chair of Fund Development. He also said that someone had sent my confidential email to John, so he knew about my concerns. The Chair asked that I step down as Chair of Fund Development and told me again that I was out of line. I replied that I thought John was a disaster and that I was concerned about the organization. I said that John did not get to decide who chaired Board Committees – that I had been voted on by the full board. I told the Chair that I did not think he was doing his job of providing oversight and that these were issues that the full board – or at least the Executive Committee should discuss.
I talked to my husband and to the two other Executive Committee members who had called me before. Turns out that one of them had also been asked to step down from her role as chair of another committee. She had also been making inquiries and contacting the Chair. I told her that I was thinking about resigning.
I waited several days and made my decision to resign. I sent a letter to the entire board rendering my resignation. I said that I was concerned that John was not the best person for the role and that the board was not providing the oversight it should. I reminded everyone that the Chair did not have any more power than the rest of us – he had only one vote – but he was acting as if he controlled the full board. I did not go into detail about what John was doing wrong. That would have been too difficult in an email.
It took a few months, but the organization fell apart. The other board member I had spoken to also resigned. Another funder withdrew its funding because we were out of compliance. More staff quit. Finally, John also quit, saying it was not the right organization for him. He said he tried to turn around a “failing” organization, but no one would listen to him. Of course, the organization was not failing before he came along. He was the one who caused its decline. He did not even last a year. Another staff person stepped up as interim and the organization struggled along for a couple years before it closed down. It was sad.
Lesson Learned
- When we hired John, I am not sure that we did a decent job at references. We left these to the search firm. After, I heard from some people in the sector that he was known to be arrogant.
- We also did not stick to our list of criteria. I thought about this after – John did not have all the skills that we put on our list, especially around developing and maintaining partnerships and managing individuals. This was his first ED position and he had never worked with a board before. I think we forgot what we wanted because he charmed us.
- I did not know if the Board Chair actually set out quarterly goals for John and followed up with him. The rest of the board should have insisted on seeing those.
- The Board Chair seemed to think he had all the power. Others on the Executive Committee and the full board should have stopped this. Quite honestly, I think we should have voted him out of his role. Board members should be familiar with their bylaws, the roles of officers, and the role of regular board members.
- In that Executive Committee meeting when I had my concerns and wanted to discuss them in Executive Session, I should have been more forceful. I should have moved immediately to go into Executive Session as I had something to share. I know someone would have seconded and a majority would have voted yes – out of curiosity if nothing else. This would have gotten the concerns much broader recognition and out of the hands of just the Board Chair.
- I should never have put my concerns into an email because it did get forwarded. I suspect it was the Chair who forwarded it to John.