For we are taking pains to do what is right, not only in the eyes of the Lord but also in the eyes of men. --2 Corinthians 8:21 (NIV)
Most of you reading this blog may have seen or heard about the April 17 60 Minutes story concerning Greg Mortenson, author of the bestselling book Three Cups of Tea, and allegations that he received substantial financial benefit from the non-profit organization he founded, the Central Asia Institute (CAI). Those allegations include:
- Only 41 percent of the funds donated to CAI in fiscal year 2009 went to schools in Pakistan and Afghanistan;
- Mr. Mortenson personally received all honoraria from his speeches; and
- CAI spent more than $1.7 million in fiscal year 2009 to promote Mr. Mortenson’s books and his speaking engagements, for which he reportedly was paid $30,000 each.
Since the story was broadcast, many of the charity’s supporters have expressed shock and dismay at the allegations. The Montana state Attorney General has launched an investigation into the organization, and Mr. Mortenson is currently under the care of a physician due to a heart condition.
None of this is good news for Mr. Mortenson, or the Central Asia Institute. I only have the CBS News story, so it is not my intent to pass any further judgment on them. But a caution must be raised to all charities: Once a reputation is damaged, it may take years to restore it, if that happens at all. One of Ben Franklin’s most familiar comments comes to mind: “An ounce of prevention is worth a pound of cure.”
Every charity, regardless of its size or impact, must be vigilant in protecting against conflicts of interest, or even their appearance. Decision-making -- from board policies to procedures in the mailroom -- must be conducted with integrity and a belief in an open and transparent environment. Three key principles are fundamental to all good charities:
1. Honest, effective, and independent governance by senior leaders and board members must be a hallmark;
2. Policies on financial accountability and transparency must be in place -- and enforced -- to protect the organization and its donors; and
3. Funds must be solicited in a truthful, accurate manner, so that donors have a realistic idea of how and where their contributions are used.
A charity’s credibility is a currency that simply cannot be wasted. Leaders who are inextricably linked to their organizations (such as CAI and Mr. Mortenson) must be especially vigilant. Why? Because those leaders -- like the rest of us -- are human, fallible and subject to temptation. Public adulation, meetings in high places, access to private jets, or a bestselling book can lead to a CEO’s sense of privilege and celebrity far beyond what donors would expect, let alone tolerate.
World Vision U.S., on whose board I serve, has made best efforts to ensure that the organization, its leaders, and the donor public are protected from potential conflicts of interest. In fact, World Vision U.S. was one of the ministries that called the community together to start the Evangelical Council for Financial Accountability (ECFA) over 30 years ago. ECFA standards, which must be met by all ministries carrying the ECFA seal, go beyond what is required by law.
Two years ago, Rich Stearns, president of World Vision U.S., wrote a book entitled The Hole in Our Gospel. It was published amid much fanfare in the Christian market, and in 2010, it was named “Christian Book of the Year.” World Vision and Mr. Stearns have promoted the book in order to lift up the message of compassion for the poor to a broad audience.
But before the book had even been written, Mr. Stearns suggested to the Board of Directors that the organization should receive all royalties. Speaking engagements related to the book? The event sponsor is asked to pay Mr. Stearns’ travel expenses. Honoraria for speeches? The checks are made payable to World Vision. The procedures put in place for its high-profile president reflect the board’s vigilance to maintain the organization’s integrity.
Charities are run by people, and all people are imperfect. As a result, mistakes will be made. Many mistakes are trivial, but some are not. And when allegations of big mistakes at one charity are aired on an award-winning network news program, all charities potentially suffer.
And that brings me back to those three vital principles and the wisdom of Ben Franklin to help protect charities from dishonoring their missions.
Paul D. Nelson is a member of the Board of Directors of World Vision U.S. and President Emeritus of the Evangelical Council for Financial Accountability (ECFA).