Dear Friends,

Yet another high profile leader of a national nonprofit has embarrassed himself, and by extension the nonprofit sector. Mark Everson, with only six months at the helm of the American Red Cross (ARC) has resigned as the result of a senior staff person at the organization surfacing Everson's affair with a subordinate. While we could dismiss this as a regrettable personal failing and move on, the Red Cross can ill afford another scandal or another leadership transition. Over the last decade its reputation suffered dearly in the wakes of both 911 and Katrina. Everson, former commissioner of the IRS, was reportedly selected in large part to rebuild the political capital of the Red Cross. Couldn't he have anticipated the possible fallout of his behavior?

The fallout of course does not just accrue to the national office of the Red Cross but to other nonprofits which must now suffer the additional skepticism of the public as well as local Red Cross chapters. Thus, the difference in size is a difference in kind; abusing public trust and positional power in the American Red Cross with its many tentacles, profile, current vulnerability, and central importance to national safety raises this out of the "personal failing" category and into an event that has far-reaching consequences for the image of the entire nonprofit sector. You may believe this to be harsh. I do not tend to moralistic judgments — can't afford to — but I still cringe from listening to debriefs of the ARC's failures during the aftermath of Katrina and the human impact. There is a lot at stake and Everson, by all accounts a smart guy, must have known this as he took on the job.

We have to deeply thank the unnamed senior staff member for taking the chance of reporting this ethical breech (blowing whistles is always a personal risk) and the Red Cross board for moving quickly and not hiding the problem, but there is clearly something systemically dysfunctional in the "C Suites" of some of this nation's most "prestigious" nonprofits. We are guessing that the way these leaders are chosen may be flawed. The Red Cross for instance has had eight leaders in twelve years. This, at the very least, suggests a board that does not know what they should be looking for — and is failing repeatedly at one of the most critical tasks of governance, the selection of an executive. As I suggested in my previous e-Newsletter about the Smithsonian, there may be problems inherent in the semi-political nature of these organizations — partially appointed boards and politically connected senior staff may not serve these critically important institutions — or the public — well.

Meanwhile in much of the rest of the sector, there are nonprofit leaders behaving with ethical integrity and a clear commitment to mission above all else. I am linking an amazing account from the Fall NPQ of one organization in Biloxi, Mississippi and the unmet local need they were faced with in the wake of Hurricane Katrina. It is an epic saga of personal commitment to the health of the most vulnerable in that storm ravaged area.

I am clear that the legions of Red Cross volunteers around this country and much of the Red Cross staff are similarly committed and self sacrificing. How is it that for Everson, the careless disrespect of his actions didn't compute?

"This comes at a particularly critical moment in the history of the Red Cross as they are desperately trying to rebuild their brand name," said Paul Light, a New York University professor of public service who studies charities told the Associated Press. "It will not destroy the organization . . . but it will erode confidence in the Red Cross and thereby in the charitable sector as a whole."

Your friend,

Ruth McCambridge

p.s. On the topic of ethics, The Nonprofit Quarterly, as you know, is the home of the Nonprofit Ethicist column in which the ethical quandaries you encounter in your daily work life can be aired and answered. We have just compiled an online collection of his columns which is available to you free if you subscribe to NPQ by Monday, December 3. And as always the Ethicist stands ready to answer any questions you may have about ethics in your own organization. We maintain your confidentiality and your questions will be answered within a week of receipt. Just reply to this email to send your question, or click here.