For me, the story about Community Action of Minneapolis, more than
anything, is the story about a bully, about how difficult it is to
dislodge a bully from a leadership position, and about how few people
are willing to take on the very difficult, thankless, time-consuming,
task of standing up to a bully.
My short answer is: I suspect that bullies in leadership positions are
more likely to be removed by external forces, such as indictments or
investigations, than by those people and mechanisms nominally
responsible for providing oversight, such as boards or the organization
for which the bully works. If you want to minimize these messes, then
I recommend that you spend more money on the agencies that perform
audits and investigations. And, support your local newspapers.
A CEO has a tremendous range of tools with which to thwart oversight by
a board. The CEO can select, or influence the selection of, compliant
board members. Board members who are likely to challenge the CEO are
unlikely to be appointed to the board, or to be reappointed, if they
raise hard questions.
A CEO has pretty complete control over the information that the board
sees and can act on. A board member may know, deep in his or her heart
that the CEO is a crook, but can't prove it with the information that
the CEO provides. I assume that state auditors had access to
information that was not available to board members.
The structure of a Community Action agency probably contributes to a
weak board. One-third of the members must come from the low-income
community, which on average is less likely to provide board members
who have the skills and inclination to take on a bully CEO. Elected
officials have lots of disincentive to taking on a bully CEO: they are
tremendously busy, and they don't need the bad publicity that comes
with raising difficult questions about a non-profit. Ditto private
sector board members.
Taking on a bully is, as I have said already, a difficult, thankless,
wearing task. A board member would have to invest perhaps
hundreds of hours to remove the CEO. And, over the weeks or months
of the process, would be subject to tremendous pressures. The CEO,
and his supporters, will attack the board member. The board member
would be accused of all manner of things: having a personal vendetta
against the CEO, being racist, wanting to damage the organization,
wanting to generate publicity, wanting to distract from the board
member's own problems, not having all the facts, not understanding
the business, being mentally unbalanced, etc., etc. etc. A CEO has
a lot of tools at his or her disposal, and knowing how to use them is
probably part of what helped him attain his position.
So, I certainly don't object to better training for board members. But,
what is really needed is for board members to be more dedicated to their
obligations to the organization. And, to have a backbone. How do you
teach board members to have a backbone, particularly in the face of a
domineering CEO?
So no, I don't believe that the Community Action of Minneapolis
is a story about the evils of capitalism, any more than it is about
the incompetence of non-profits. Just like I don't believe that it
was caused by Benghazi, that it caused Benghazi, or is in any way
related to Benghazi. Or, whatever your favorite ax is to grind.
-tjs