The Silicon Valley Community Foundation’s Toxic Workplace Culture

(Image: Creative Commons, Brian Solis, www.briansolis.com and bub.blicio.us)

The Silicon Valley Community Foundation (SVCF) has ascended to the highest ranks of the nation’s philanthropy sector. Its success stems largely from Silicon Valley’s immense wealth; SVCF is the primary recipient of charitable giving from the biggest players in the tech industry. Supported by tech moguls including Mark Zuckerberg, Reed Hastings, Paul Allen, and Jack Dorsey, SVCF has become the third largest foundation in the United States, larger than the Ford and Rockefeller Foundations.

But the foundation—which commands $13.5 billion in assets—is in hot water. A damning report by the Chronicle of Philanthropy details the abusive behavior of SVCF’s former chief fundraiser

Mari Ellen Loijens. According to a number of current and former SVCF staff members, Loijens oversaw a toxic workplace rife with verbal abuse, threats, and racism. She has since stepped down, and the foundation’s CEO Emmett Devon Carson is currently on paid leave.

The revelations are shocking. Loijens referred to a black employee as a “slave.” She threatened to kill an employee for meeting with a donor by herself. She subjected staff to sexual innuendos and insults.

One employee claims to have approached Carson about Loijens’ erratic and inappropriate behavior, only to be rebuffed by the CEO. “He was definitely not open to a conversation about her at all,” the employee told The New York Times.

This lack of accountability is too common in the nonprofit sector. SVCF leadership did not reprimand or remove Loijens because of her fundraising prowess. If she continued to satisfy the board while breaking fundraising records to support the foundation’s constituents, why change anything?

There are, of course, long-term ramifications to these malpractices and SVCF leadership’s failure to take action. By sacrificing its commitment to ensuring a safe and healthy workplace for all of its employees, SVCF has dealt itself a terrible blow. The foundation’s ranking on Glassdoor (a website tracking worker reviews of employers) is abysmal. Up-and-coming fundraising talent will set their sights on large foundations without a track record of employee abuse before settling for a job at SVCF.

The scandal has also tarnished the foundation’s ability to pursue its mission to “strengthen the common good locally and throughout the world.” On its website, SVCF lists “diversity,” “respect,” and “public accountability” among its values. These qualities, however, were completely absent from Loijens and Carson’s leadership. Their insular bubble at the top of the organization allowed a culture antithetical to the organization’s very principles to fester.

Foundations and nonprofits cannot simultaneously advocate for the public good while treating their staffs poorly. Similar fundraising cultures exist across the country, showcasing what happens when an organization loses the proper balance between revenue generation, serving its constituents, and nurturing a positive work culture.

Another #MeToo Scandal Hits the Nonprofit Sector

New York State Attorney General Eric Schneiderman received accolades for his efforts on behalf of the #MeToo movement. As the head law enforcement official in New York, he filed charges against Harvey Weinstein to win additional compensation for the numerous victims of the Hollywood magnate’s misconduct.

Now, Schneiderman has resigned and faces an investigation following the release of a New Yorker report alleging that he physically abused several women. These shocking revelations underscore how pervasive sexism and sexual violence are throughout all sectors: private, nonprofit, and government. They also demonstrate how rhetorical allies can, in fact, be perpetrators themselves.

When leaders abuse power to hide and perpetuate their chauvinistic behavior, the ramifications course throughout their organizations and industries. This was on full display in February when the Human Society bungled its response to the allegations against its then CEO, Wayne Pacelle.

While an elected official falling from public grace in the #MeToo spotlight may seem irrelevant to nonprofits, Schneiderman’s abrupt departure impacts New York-based nonprofits significantly. The now disgraced former attorney general used his office to aggressively police venal and corrupt individuals in the nonprofit sector, thereby raising the public’s trust in social good organizations.

He also championed legislation that would enact a state level version of the Johnson Amendment, the federal law that enshrines nonpartisanship among 501(c)(3) nonprofits. Donald Trump has threatened to dismantle this important U.S. tax code provision, which could result in the abuse of 501(c)(3) fundraising for political ends.

The tax law appears safe in the New York State Legislature’s hands, but the effective operations of the Charities Bureau—which is under the attorney general’s scope of responsibilities—is now uncertain. Will the next attorney general police bad actors as aggressively? Or will this brief period of accountability and smooth regulation end?

The #MeToo reckoning has been long overdo. Reinstating trust in organizational leadership and fostering gender parity are essential priorities across all sectors. As Schneiderman’s case illustrates, bad actors harm their victims and have a detrimental ripple effect.

Religious and Arts Nonprofits Face Grim Fundraising Prospects

Last year’s tax bill has greatly diminished the incentive for taxpayers to donate to charitable organizations. The number of U.S. taxpayers itemizing deductions could drop from approximately 37 million to 16 million. This could be the most dramatic decline in charitable giving in the modern era.

Which organizations will hurt the most? The greatest change in tax incentives will impact the giving behavior of the middle-class tax bracket, meaning that families earning under $100,000 will probably donate less in the coming years. This demographic overwhelmingly favors donating to local nonprofits, especially religious institutions, such as those that run soup kitchens. That means that religiously grounded basic needs organizations could be in trouble.

Additionally, arts nonprofits will take a hit. Across the board, individual giving to arts and cultural organizations is already down 9.6 percent, and this downward trend is expected to continue over the coming years. Leaders of major cultural institutions—including flagship art museums—may not have much to fear as the major donors that keep them afloat continue to dole out resources, but smaller arts organizations face a dim fundraising forecast. Grassroots funders and mid-level donors will donate to fewer organizations than in previous years, and the nation generally views arts funding as secondary when compared to other causes.

Religious and arts nonprofits can expect an increasingly competitive fundraising climate as organizations vie for diminished resources. Fundraisers should use the same gusto soliciting and stewarding tax-savvy donors that they use with emotionally motivated donors. Properly targeting each distinct donor type creates flexibility, which is necessary for organizations to survive in the changing nonprofit sector; those with it will succeed, and those who lack it will merge or perish.

“Rage Giving” is Not Sustainable

(Image: Public Domain)

As we recently explored on Nonprofit Pro Media, the nonprofit sector faces a grim fundraising forecast in the wake of the tax bill that passed congress last year. The legislation has greatly reduced incentives for itemizing deductions, which could result in the loss of billions of dollars in revenue for nonprofit organizations.

This dire situation comes on the heels of excellent fundraising numbers for 2017. This small boom in charitable donations partly occurred due to what one professional at Blackbaud deemed “rage giving.” In our divided political climate, citizens across the political spectrum spoke out via donations, funding organizations that closely correlate with their political and moral ideals.

The left saw the greatest surge. Major institutions that embody liberal ideals saw a massive surge in support, including the ACLU, the Southern Poverty Law Center, and Planned Parenthood.

While these and organizations similar to them may continue to benefit from this phenomenon for the time being, they cannot rely on this support sustaining their programs in the long run. The nation’s political environment ebbs and flows. When a political movement that was in opposition wins power, the urgency for its rank-and-file to get involved dissipates.

This year may look a lot like 2017, when donation surges occurred following specific events. The ACLU, for example, brought in a whopping $24 million in the weekend that followed the Trump Administration’s first attempt to enact a travel ban on Muslim nations. One big political move by those in power could create a similar windfall in the coming months.

But these resources are dependent on a base that is continuously charged. If history is any indication, this level of enthusiasm will not last forever.

The New Tax Law Will Devastate Nonprofit Fundraising

(Photo Credit: Gage Skidmore, Creative Commons)

When Republicans passed the Tax Cuts and Jobs Act of 2017, GOP legislators were euphoric. House Speaker Paul Ryan called the bill “one of the most important pieces of legislation that Congress has passed in decades,” adding that it will result in “profound change” and will set the country on “the right path.”

Not everyone shares Ryan’s optimism. One major criticism that emerged from both ends of the political spectrum involves the amount of national debt it will generate—$1.7 trillion by the CBO’s estimate. Others point out that the bill will only benefit middle- and lower-income U.S. taxpayers in the short-term, while the real windfall goes to the wealthiest 1 percent, who will enjoy as much as 83 percent of the gains produced by the cuts.

Pundits and media outlets have neglected one significant area of concern regarding the tax bill’s impact: a dramatic decrease in revenue for nonprofits.

The legislation altered several key parts of the U.S. tax code that will significantly diminish the likelihood that millions of Americans will donate to charity. In 2019, the standard deduction will effectively double, which will decrease the number of Americans itemizing deductions in their tax  filings from approximately 37 million to 16 million. With fewer middle-income taxpayers itemizing deductions, nonprofits are going to take an enormous hit.

The nation’s wealthiest will also limit their charitable giving thanks to changes to the estate tax. The amount exempted from estate taxes will more than double, redirecting large volumes of money away from nonprofits.

The ramifications of these tax code changes could be industry-shattering. According to the Lilly Family School of Philanthropy, donations could drop by $13.2 billion. A study conducted by the  The Tax Policy Centre predicts that the decrease in charitable giving could range from $12 to $20 billion (for perspective, the worse case scenario predicted by this study amounts to 5.13 percent of the overall amount raised by charitable organizations in 2016).

Development professionals are justifiably panicking over the dismal fundraising forecast. In an interview with the Philadelphia Inquirer, Maureen Murphy—the head fundraiser for VNA Philadelphia—remarked that the “changes make me lie awake at night.”

If the fundraising actuals for the next few years are as bad as the projections, the nonprofit sector may face a financial climate that is even worse than the 2008 recession. According to one estimate by Georgetown University, as many as 220,000 nonprofit workers could lose their jobs. Both the decline in programmatic resources and the spike in staff shortages will hurt the countless constituents that rely on the vital services provided by the nation’s charitable organizations.

Nonprofit professionals need to vocalize opposition to these changes to encourage a policy alternative that will salvage more of the industry’s desperately needed revenue. The tax bill’s architects heard objections relating to these horrible impacts before the legislation passed and did nothing to address them. This is unacceptable, and the industry most organize around this troublesome neglect and promote its own political voice during this perilous period for nonprofits.

Is it Time for a Nonprofit Workers Union?

(Image: SEIU Local 1, Creative Commons)

Many nonprofit employees have experienced it before: management justifies cutting overhead costs—including a host of employee benefits—in order to free up resources for programmatic spending.

Organizational leadership often perceives their workers as mission-driven as opposed to profit-driven, an exact corollary to the economic model behind nonprofits. In reality, this mentality contradicts the very purpose of nonprofits to promote and cultivate the social good. How can any nonprofit truly pursue its mission to improve the world if it requires implementing anti-social practices to do so?

Exploited YMCA workers in Chicago fought back in early March against such labor abuses. Unionized childcare workers represented by SEIU went on a one-day strike to protest poverty-level wages, extreme salary stratification, and unreasonable work expectations due to chronic staffing shortages.

The workers’ various complaints are fundamentally intertwined. Low wages and strenuous work hours create high turnover rates (a problem that affects the entire nonprofit sector), which consequently raises the workloads and expectations of the workers who remain on staff.

The strike shut down 10 early childhood sites run by the YMCA of Metropolitan Chicago, interfering with the organization’s mission to provide for its marginalized constituents. There are no easy answers to the economic plight that many nonprofits like the YMCA face. Treating nonprofit employees unfairly, however, is certainly not a solution.

Millennials—who have become the largest share of the U.S. workforce—are significantly more pro-labor than the preceding generations. This has given hope to unions, which have struggled in recent decades due to a number of factors ranging from deindustrialization to union-busting laws around the nation. The events in Chicago may point toward more labor militancy among nonprofit workers.

Pro-union sentiment, however, is far from universal. An informal poll conducted by Key Elements Group LLC of 71 industry professionals of all ages found that 68% of respondents did not want to join a union dedicated to nonprofit workers.

As millennials’ share of the workforce grows and Generation Z begins their careers, the barometer may shift in the opposite direction. Nonprofit leadership needs to prepare for this possibility. What happened in Chicago could happen with greater frequency, especially if organizations fail to adapt to the expectations of rising generations.

The Human Society’s Cautionary #MeToo Tale

(Photo: The Human Society Headquarters in Washington, DC. Credit: AgnosticPreachersKid via Wikipedia, Creative Commons)

As we have previously discussed on Nonprofit Pro Media, the #MeToo movement has pushed sexual harassment at the workplace squarely into the spotlight. Across a number of industries, perpetrators whose behavior went unchecked for decades are now facing accountability for abusing their power. The nonprofit sector, however, has yet to fully reckon with its own culture of sexual harassment.

This was painfully on display last month when the Humane Society bungled its response to credible allegations that the organization’s now former CEO Wayne Pacelle had sexually harassed female employees.

Pacelle — who had helmed the widely respected animal welfare organization for over a decade — purportedly force-kissed a former intern and requested that a female employee watch him masterbate. The accusations against him, which include other alarming behaviors, extend back to 2005.

In a shocking move, the Human Society’s board decided to abruptly scuttle the investigation into the allegations out of deference for Pacelle. Rick Bernthal, the chairman of the board, explained the reasoning behind the decision in a statement:

Many of the allegations were explosive in nature, and reading or hearing about them is a shock to anyone. It was to us, too. But when we sifted through the evidence presented, we did not find that many of these allegations were supported by credible evidence.

Despite defending the board’s vote, Bernthal acknowledged that three of Pacelle’s accusers received severance packages upon leaving the organization, qualifying that “there was no motivation . . . to silence women.”

The backlash was swift; volunteers and staff spoke out, and high-level associates announced that they would not renew contracts. Not long after the upheaval, Pacelle stepped down.

The end result — the departure of a controversial CEO — occurred despite the board’s efforts to thwart change. The effort to safeguard Pacelle only made matters worse. Seven board members quit in protest over the initial decision to end the investigation, and the organization’s name has been dragged through the mud. Now, the Human Society’s top levels are in disarray and it has a massive public relations disaster on its hands. This mess underscores that nonprofits suffer from leaders who abuse power not unlike their for-profit counterparts.

Nonprofit leaders: do what is right. Donors: demand that those whose actions are ill-reputed be held accountable. Heed the cultural moment and value your workers rather than digging in your heels for the sake of familiarity. Your organization’s success depends on it.

Sexual Harassment in the Nonprofit Sector

The #MeToo movement has thrust an all too common workplace occurrence into the open: sexual harassment.

Commencing with the downfall of Harvey Weinstein in Hollywood, there has been an enormous ripple effect throughout the male-dominated media world. Powerful figures have had to answer for their abusive behaviors, some after years or even decades of inappropriate conduct.

The movement’s impact has expanded into the political realm, resulting in elected officials either resigning or forgoing reelection campaigns at the local, state, and federal level.

The nation is in the midst of a cultural sea change. From here on out, it will be difficult for the powerful to sweep sexual harassment and sexist behavior under the rug.

Despite the growing pressure on abusive men in sectors with high public visibility, there are still many industries in the U.S. economy that either overlook sexual harassment or enable workplace cultures that enshrine it. The nonprofit sector is one of them.

In the world of philanthropy, fundraisers rank among the most susceptible to unwanted sexual advances and mistreatment by superiors. Four out of five development professionals are women, meaning that the industry’s workforce as a whole faces a hostile work culture antithetical to the pro-social principles that underpin the philanthropic sector.

In a 2017 survey of fundraisers, Inside Philanthropy found that not only did a majority of female respondents report sexual harassment, but that a stunning 43 percent encountered patterns of mistreatment at work.

The nonprofit sector’s distinct structure makes its culture of sexual harassment particularly difficult to counteract. The industry features the typical power dynamics between management and staff, but also includes a host of other players in positions of power, from major donors to trustees. The Inside Philanthropy survey found that these parties were guilty of sexually harassing female fundraisers.

The complex web of power encourages many at the top to look the other way. Writing for Philanthropy, Sarah Beaulieu describes anecdotes from colleges where HR or executive personnel responded to complaints of sexual harassment committed by donors by referring to the incident in question as a “sticky situation.” A donor, after all, is not an employee of the organization, and a nonprofit’s top brass may be reluctant to jeopardize vital funding sources. As Veritus Group’s Richard Perry and Jeff Schreifels put it, for nonprofit executives, “money outweighs the offense and life just goes on.”

This lack of support for fundraisers is dangerous. Fundraisers meet privately with powerful figures, often over dinner or in situations that may encourage unscrupulous donors to indulge in inappropriate or even criminal behavior.

Like private businesses, most nonprofits maintain policies designed to safeguard against intra-organizational sexual harassment. Policies protecting against third party abusers, however, are less common. It is incumbent upon nonprofit leadership to make sure that staff members are protected by cogent and actionable policy measures that guarantee workers’ rights to pursue their important work free of sexual harassment.

By neglecting the wellbeing of its work force, the nonprofit sector only tarnishes its own image as a promoter of the social good. Nonprofits cannot do justice to their missions or brands without advocating for their workers.

In Historic Reversal of Policy, Met to Start Charging Admission Fees

Branding is just as important for nonprofits as it is for private enterprises. In today’s marketplace, nonprofits are up against stiff competition from a variety of industries for consumers’ attention, and effective communications are nearly impossible without a public identity that your constituents can understand and recognize.

One major U.S. institution just reversed perhaps its most notable policy, and the price its brand will pay in the long run is uncertain.

The Metropolitan Museum of Art (more popularly known as “the Met”) has been free to the public since the 1970s – that is, until now. Organizational leadership has announced that non-New York residents will now have to pay a $25 fee to enter.

Residing inside a publicly owned building, the Met is the largest art museum in the country, and its nearly 50 years of pay-what-you-want entry fees contributed to its international stature and cemented its identity as a truly democratic cultural resource.

During a visit in September, I participated in the pay-what-you-want system and gave the Met $25. In theory, visitors who can afford this recommended fee offset the cost for others who cannot readily pay. Some critics suggest that the museum did not effectively communicate this concept over the years.

Museum officials have cited two trends that led to the policy change: the last decade has seen yearly attendance sore by three million, while the percentage of visitors donating the suggested amount has plummeted by 46 percent. Additionally, the institution has struggled with mismanagement (its director Thomas P. Campbell resigned in ignominy last year), and it tackled its massive deficit only after receiving an $80 million gift from the estate of the late Herbert Irving, the largest gift the Met has ever received.

That life-sustaining donation, however, went toward stalled projects, such as a massive expansion planned for a contemporary art gallery. None of it was earmarked for subsidizing visitor access to the storied museum.

Arts and culture writers have pointed out that the change in policy diminishes the Met’s fame and character. Writing for the New Yorker, Alexandra Schwartz argues that accessibility of the museum “is an ethical mission, and an especially important one in a city that feels more and more closed.” Considering NYC’s increasingly prohibitive cost of living, the introduction of admission fees at the city’s historically free world-class museum does seem like the end of an era.

The art critic Roberta Smith from the New York Times specifically criticized the policy’s differentiation of visitors: “It divides people into categories — rich and poor, native and foreign.” Long billed as a shining example of equal access, the museum’s somewhat confusing admissions policy now separates visitors into different groups.

What these writers make clear is that this policy change marks a turning point in the museum’s history. Once, the Met was accessible, democratic, and open; now, it is like any other museum, a reality even more painful considering that its building is publicly owned.

There are no easy solutions for the Met’s woes. Perhaps the greatest takeaway from the situation is a cautionary tale: prioritize your organization’s key objectives and brand-affirming practices and proactively communicate them to the community and your audiences. Organizations will find themselves suddenly entering periods of change, so best to plan ahead and craft an effective messaging strategy for when difficult decisions need to be made.

How Nonprofit Management Should Treat Pro-Labor Millennials

Previously on Nonprofit Pro Media, we discussed the economic distress experienced by millennials, and how their financial plight has changed public opinion on labor organizing.

Unions experienced a precipitous drop-off in membership from the 1970s to the present. The public’s understanding and appreciation of labor unions followed a similar trajectory. The advent of the sharing economy, however, has resulted in a decidedly pro-labor environment, as contract workers in the rising millennial workforce miss out on the benefits that older generations enjoyed while struggling to make ends meet.

There are a number of reasons why nonprofits should treat pro-labor staffers with respect, valuing their opinions and working with them to create a more just workplace equipped to pursue the social good.

In today’s marketplace, millennials offer a number of indispensable skills; they excel at digital marketing, understand how to employ software to enhance productivity, and are adept at quickly researching and synthesizing disparate bits of information to solve complex problems. Additionally, millennials are passionate about social causes, including labor rights. Unions are adapting to millennial interests – such as social justice and equality – in efforts to appeal to them.

If your organization wants to attract the best talent of this generation, you cannot afford to under-compensate or exploit your workers. Doing so will hamstring your organization’s ability to hire skilled and passionate employees, thereby threatening your nonprofit’s efficiency in the long-run.

Furthermore, millennials make up a growing share of the voting public. This past election cycle, Generations X and Y surpassed baby boomers as the largest share of votes cast. Whether or not today’s political class is willing to accept it, millennials will soon be the decision-makers. Public policy affects all sectors, including nonprofits; building good faith and affinity with rising generations today can pave the way toward a fruitful relationship with the political class of tomorrow.

Here are five steps nonprofit management can take to ensure a just workplace:

1) Be Transparent
This may sound obvious, but as we explored in the second post of this series, nonprofits often overwork their employees. One deceitful way of doing so includes withholding key details of an employee’s rights and benefits. While nonprofit professionals are committed to advancing the social good, they also want to live balanced lives, and should be able to take advantage of all their contract has to offer.

2) Encourage Your Workers’ Passion
Studies show that millennial workers value employers who provide them with opportunities to contribute to the social good. While nonprofit professionals are able to work toward positive social causes on a daily basis, there is always room for organizational management to further harness the passions of its staff. Make sure to engage your millennial employees; ask them how the organization can better pursue its mission and adhere to its values. Invite discussion around the most pressing issues facing your nonprofit’s particular area of focus. Doing so will prevent daily work from becoming rote while strengthening your staff’s commitment to the organization’s agenda.

3) Understand Labor Rights
It’s the law: employees can express opinions about labor organizing and confer with their colleagues without interference from management. The fundraising affiliate for U.S. PIRG and Environment America shuttered entire offices that had threatened to unionize. The organization also pursued anti-labor polices that the National Labor Relations Board deemed illegal. Do not waste your organization’s resources on potential legal trouble: you will only tarnish your nonprofit’s image in the process.

4) Open Dialogue
If you are concerned that your organization cannot cope with a unionized workforce, talk with your employees instead of trying to derail their conversations. Many private businesses run disinformation campaigns to stymie labor organizing. This could have the unwanted effect of sowing division among your workforce – the last thing that a nonprofit needs. By addressing employee’s concerns from the start, you can prevent the situation from getting more complicated.

5) Provide a Seat at the Table
When everyone’s voice is heard, it is easier to work together. If your workers unionize, don’t panic. Nonprofits already navigate the back-and-forth between management, board, and funders. Educate your organization’s key stakeholders about the merits of unionizing and how it can benefit your organization’s brand by connecting with the key interests of millennials. At the end of the day, creating a just and fair workplace not only creates staff cohesion, but builds longevity.

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