| Question: With great power, comes great | | | | and procedures that address what steps should be |
| responsibility. But what happens if those with the | | | | taking to whistle-blow any wrong doing within the |
| power to ensure stringent corporate governance, | | | | organization (Check to see if your organization has a |
| bends the rules to attain his personal goals or returns | | | | whistle-blowing policy). Check the organization's |
| a friend's favor, that conflicts with the company's | | | | bylaws...This can be accessed directly from the |
| well-being. | | | | organization or through the secretary of state where |
| If a non-[profit] executive director, who is heading | | | | the agency is based. Here are some ways to |
| the Audit Committee of a listed company - is known | | | | determine if a behavior has crossed the line: |
| to be acting upon personal goals than the company's | | | | * Directors have a duty of loyalty. This dictates that |
| benefit, is there a process by which 'mis-use of | | | | officers/directors must act in good faith and must |
| authority' exhibited can be curtailed. | | | | not allow their personal interests to prevail over the |
| Are there any red-flags where such behavior is | | | | interests of the organization. Has this been violated? |
| exposed? | | | | If so, this is a red-flag. |
| Answer: | | | | * Directors have a duty of obedience. This requires |
| Nonprofit executives (as wells a corporate | | | | directors and officers to be diligent and prudent in |
| executives) often times place themselves in some | | | | managing the organization's affairs. |
| dangerous positions by taking advantage of and | | | | * Directors have duty of care. This forbids directors |
| abusing their power which can have a devastating | | | | from acting outside the scope of corporate powers. |
| impact on an organization. This type of behavior | | | | 3. Finally, remember that at the committee level no |
| should not be tolerated. Here are a few solutions to | | | | decisions are made in regards to governance. The |
| the problem you stated: | | | | committee gives a report, executive summary, or |
| 1. First, an executive director should not be heading | | | | recommendations to the board and they make the |
| up any committee unless this person is actually on | | | | decisions about appropriate actions. If you see that |
| the board (as a board member). All nonprofit board | | | | the abused is still not being addressed, here are |
| committees are required to have at least one board | | | | potential next steps to consider: |
| member on the committee. The committee can have | | | | * Report your complaint to the Attorney General of |
| other people on the committee that are non-board | | | | the state which the organization is based in (or was |
| members; however, the board chair appoints a | | | | filed as a nonprofit). |
| person from the board to head up the committee. | | | | * If the problem still is not addressed, as a final |
| 2. Nonprofit organizations should have some policies | | | | resort consider taking the matter to the press. |