Image Courtesy: Jose Manuel (mazintosh), Licensed under the Creative Commons Attribution-ShareAlike 2.0 Generic | Flickr

April 17, 2018; The Hollywood Reporter

Former Fox studio CEO Bill Mechanic has served twice on the board of the Academy of Motion Picture Arts and Sciences (AMPAS) (GuideStar profile here), best known for its annual Oscars film awards. Following a first board term and a “voluntary hiatus,” he was named to a second three-year term in 2016. His resignation, and the public nature of it, indicates there are some potentially serious management and governance issues at the organization that may sound familiar.

“I feel I have failed the organization. I feel we have failed the organization,” Mechanic said in his resignation letter to Academy president John Bailey. He cites specific management issues, from inclusion, to the often long and boring Oscars telecast, and cost overruns for the Academy’s delayed museum. He also refers to increased staff turnover under current CEO Dawn Hudson over the past several years as “seem[ing] more like a purge to stifle debate.”

The problem behind the problems that Mechanic sees is one of governance. The Academy has a 54-member board of governors with a president (board chair) elected to a single year term. The combination of rapid board leadership turnover and a large board has given the CEO “much broader and far reaching” authority, with “results that are erratic at best.” Not surprisingly, he sees one problem being that too many board members are silent about the problematic governance and management issues he has identified.

In his letter, Mechanic told Bailey:

[I] decided to run again a couple of years ago when many of the decisions of the Board seemed to me to be reactive rather than considered. I felt I could help provide some perspective and guidance.

But it’s exceedingly clear to me since returning to the Board that things have changed and there is now a fractured environment which does not allow for a unified, strategically sound, vision. I haven’t had any real impact, so now it’s time to leave.

It’s tempting to highlight Mechanic’s problems with the Academy’s response to the #MeToo movement in the wake of the Harvey Weinstein scandal. Following the implementation of new conduct standards, Bailey faced allegations of sexual harassment that, after Academy review, were judged “unworthy of further action.” In his letter, Mechanic said he finds things like “sexual harassment [and] discrimination in the Industry” to be outside the purview of the Academy, which is being “blamed for things way beyond our control.” However, the issue of the Academy “playing Moral Police [sic]” was but one of six that Mechanic mentioned in the same sentence in his resignation letter.

Mechanic’s story underscores the difficulties in nonprofit governance and management for even the largest and best-known organizations with experienced corporate leaders as board members. Will the Academy respond by making significant changes, or will things continue as they have? It’s up to the 54 Academy governors and the CEO they employ.—Michael Wyland