Nonprofit Radio for September 20, 2019: Wounded Charity

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Doug White: Wounded Charity
Author and consultant Doug White returns with his latest book, “Wounded Charity,” positing that the 2016 allegations against Wounded Warrior Project were mostly untrue and that the organization’s board failed. Join us for a provocative and thoughtful analysis.

 

 

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Transcript for 458_tony_martignetti_nonprofit_radio_20190920.mp3.mp3 Processed on: 2019-09-20T19:10:34.517Z S3 bucket containing transcription results: transcript.results Link to bucket: s3.console.aws.amazon.com/s3/buckets/transcript.results Path to JSON: 2019…09…458_tony_martignetti_nonprofit_radio_20190920.mp3.mp3.868378293.json Path to text: transcripts/2019/09/458_tony_martignetti_nonprofit_radio_20190920mp3.txt Hello and welcome to Tony martignetti non-profit Radio. Big non-profit ideas for the other 95% on your aptly named host. Oh, I’m glad you’re with me. I turn drama Tropic if you unnerved me with the idea that you missed today’s show. Wounded Charity author and consultant Doug White returns with his latest book, Wounded Charity, positing that the 2016 allegations against Wounded Warrior Project were mostly untrue and that the organization’s board failed. And the media. Oi Doug brings a provocative and thoughtful analysis on Tony’s take to take caution in your plan. E-giving relationships Responsive by witness E. P. A. Is guiding you beyond the numbers. Witnessed gps dot com by Cougar Mountain Software Denali Fund. Is there complete accounting solution made for non-profits tony dot m a slash Cougar Mountain for a free 60 day trial and by turned to communications, PR and content for non-profits, your story is their mission. Turn hyphen to dot CEO. What a pleasure to welcome back to the studio. It’s good to be Don’t wait. Yes, he’s the author, teacher and advisor, two nonprofit organizations and philanthropists. He’s said he’s the soul. That’s the only part they want occupying those three those three categories. He’s co chair of the full proof foundations Walter Cronkite Project Committee and a governing boardmember of the Secular Coalition of America. He’s the former director of Columbia University’s master of science in fund-raising management program. Before that, he was academic director at New York University’s heimans Center for Philanthropy and fund-raising. That’s where we first met. His latest book is Wounded Charity. Lessons Learned From the Wounded Warrior Project Crisis will be published early October, and that’s what brings him back to non-profit radio. Welcome back as I say, It’s good to see you again. A pleasure. You’re our first live guest in our new studio. I can smell the paint. I can t o and the elevators better intoxicating. The elevator is bigger. There’s more than one, and it’s you. It sounds different to me. Uh, we got it. We got to get some things up on the wall, but it feels good. Just welcome to the new space. Well, thank you. It’s good to be a part of it. Um, yeah. Wounded warrior project. Very interesting. You’re You uncover some things that a lot of people do not know. Um, and you say that you’re actually you’re offended, Earl. I think early in the book you say that you’re offended by what happened to Wounded Warrior Project. The reaction that the board had you took offense at this. I did. But not at first. Because when you hear something on CBS or read something in The New York Times, you tend to think it’s true. And before I go too far, I want to make sure that people know that I like CBS News. I like most of the networks and I think the world of The New York Times. But this is a story that they got wrong and it was egregiously wrong and upon having learned what did happen, I am offended. I’m offended by the lack of journalistic standards. I’m offended by the way the board behaved. And every time I ask somebody about this story, did you hear about what happened to a wounded warrior project? I’ll have reactions to Oh, that’s that fake charity. That’s the charity spent all the money wrong, and I say, Where did you hear that? And of course, he’ll tell me where they didn’t. Of course, that’s where thatwas the times and CBS. But then I say there is more to that story and most of what you know is wrong. More to it. You. Ah, Now, at the end, you call it a long, long, nurturing hit job. A long, marinating hit job That would be the freezer. Long magnetic it job is the phrase you Yes, way Have a full hour together. So we have plenty time. Thio flush this out. But say little about long marinating the two people who were fired the CEO and CEO Steve Nord Easy and Al Giordano were fired in March will probably do a CZ. We go forward with the story of this, but they were fired in March of 2016 after scathing reports out by CBS and The New York Times. And it would be easy to think then, logical to think that as a result of those reports, the board looked at their leadership and said, we’re going in the wrong direction. It is my opinion that that decision was made well before those reports came out. Now. Yeah. Okay. We’re gonna get to that. All right. Wonderful. Um So the claims in the media were were scathing money wasted on travel and entertainment costs were too high. Morale was low. Programs failing. Um, some watchdogs, charity navigator and charitywatch, specifically low grades. Um, yes, this was This was all January 2016 a CZ you’ve said New York Times and CBS, but not in that order. Give us Give that what happened at CBS and then The New York Times And what was said I was home about nine o’clock on Tuesday night the 26th of January and enjoying my, I think, second bourbon when I got a text from a good friend of mine and someone you may know to Laura Fredericks. Oh, sure texted me and said, Did you see what CBS said about Wounded Warrior Project? And she’s also on the board off another veteran’s organization. So she’s tuned into these kinds of things, and I said, No, I hadn’t. So I looked it up and watched it, and I thought, Wow, this is Ah, pretty scathing report because it said that they were spending money badly, that morale was bad and everything you’ve just mentioned. And I thought this sounds like something I would be interested in because, as you know, with other books, another work that I’ve done. I’ve been very critical of charities because I don’t think charity should be badly run. I think they should be well run by people who care about the work they do and having a charitable ethos. And so I’m my intent are up when it comes to bad behavior charities. And so I thought, Well, this is just another example of that because I had no contact with Wounded Warrior Project Before this time, however, I had contact with a reporter of The New York Times about six or maybe four weeks prior. I had been called by day Phillips, who ended up doing this report about Wounded Warrior project, and at that point I knew nothing more than what was publicly available. You know, the information that was publicly available on nine nineties and other reports, and basically his take with our conversation, which, by the way, lasted about an hour or an hour and 15 minutes. What is the ethos behind an organization that is, that is growing so quickly? Is there a problem with that? Inherently. What about their programs? And all I could speak to was with what I knew publicly, and it was all very positive. I said, I get it That that there are criticisms. Don’t get me wrong. I’m not saying they’re perfect, but I can’t see anything wrong with them. We ended that I think on a fairly good note. And I had no clue that he was working on this kind of a story. And I’ll tell you this much at that point, I don’t think he waas right. You think he changed his slant of the story when CVS came out with what you saw, I well, they knew CBS was coming. I mean, what happened was that Tuesday night, I knew it was gonna be a three part series on CBS. I wanted I did, right? Dave Phillips. And I said, Are you aware that CBS now has this big story scooping you? Yeah. And so I thought, this is not good. My answer came the next boarding When I read the New York Times when that story was in the New York Times above the front page above the fold. That’s correct. Now what? So I was curious about this. Why would the times if if you’re right, why would they slant the story because of what? Because of the direction CBS took. Why couldn’t they take their own tack if they were Maur? If you felt that Dave Phillips was Maur neutral about about wounded warrior, Yeah, and I think in the long haul of things I want to be gentle with Dave Phillips because I don’t think he’s the bad guy here. And I think I know he’s a very good reporter. I think what he had was what I call an evergreen story. It was not something that had a deadline to it nearly did, by the way, the CBS take have a deadline to it. But it was much more salaciousness. And so I think he tried to catch up to that salaciousness. That’s what I think happened. But he wasn’t finding that. And you don’t You don’t pursue this in the book. But it was a question I had. He wasn’t finding that in his You don’t think in his in his own in his own research, not originally. But then he got talking to people who are on a Facebook page. We’re all malcontents, former employee employees. And so he got inside the second chamber and listen to it after a while. And when he went down to wounded warrior project in Jacksonville, he had many interviews. Many of them were very positive in all of them. Got put on to the cutting room floor. So he at that point had shifted because CBS came into the picture late, like in December s so late, 2015. And so I think he had timeto switch gears. Okay, we have Thio take a first break, and that is for Wagner. CPS. They have a wagon or on September 25th Exempt or non exempt. You need to classify and pay everyone correctly under the Fair Labor Standards Act. And you need to document what you’re doing. Wepner will explain it so you can understand it. Weather cps dot com Click Resource is and upcoming events. If you missed it, live so many of our podcast listeners. I can understand that. Then go to re sources and recorded events. All right, let’s go back to ah, wounded charity. Um, so he so he caught up with the salacious side of it. All right, I’m still alright. This Yeah, There was the malcontent employees Echo chamber. All right, so Wonder Warrior Christ Wounded Warrior Project now has a crisis. There was a three part series on CBS over what, Over two nights a night the next morning of the following night. Oh, that’s right there and one in the morning and then the following night. And they’ve got this New York Times with peace. Which came the guest, the 27th of January. What is the board do? The board hires Simpson Thatcher law firm here and a group called FT I, which is accounting firm to do an audit of the organization’s finances. They did that almost immediately, probably within a few hours of the reports coming out because they wanted to find out what was going on with regard to the accusations that money was being misspent. They also at the same time silenced the CEO. Stephen aren’t easy stating our Daisy is a pretty savvy guy. Probably one of the better CEOs. What was his age at this point? Him and al what were their ages? They’re not really young, but they’re not old. I would say they’re probably in their fifties. Okay? Yeah, something normal helps me on. I think they’re about the same age they came through the world with the veterans world. Kind of the same time. At any rate, um, they were told they couldn’t talk to anybody. And Steve actually was very media savvy and good person in many ways said to the board, This is not the right strategy, because we’re gonna be out there hanging without any story. And we’re not even responding. He wants to get ahead of it. He wants to get ahead of grab it. Yes, like you would advise your own clients to do in an emergency. Silence is bad because the story takes story goes on without you. The stood out without your part of it. Well said, Well, that didn’t happen. And so he was muzzled. Reinardy xero Steve. Not easy as a CEO. Yes, Al Al Giordano CEO. Yes, two Italians. But what you didn’t pursue the Italian American discrimination pathway into this thing? These two, these two screaming Italians nor D. C. And Giordano railroaded by the board. You didn’t pursue that? You know, you’re the Italian American sentiment on the warrior project. Most of the lack of intellectual curiosity. Okay, I’ll help you. Thank you. Bring me in. Silences them now I had another something curious CBS offers. Did he say? Nor Deasy or not? D. C Easy, easy. Okay, The proper princessa Ditzy what? You wouldn’t zizi like brothers pizza? You don’t say Pisa pizza. Nor did Marty Martin, yet martignetti CBS offers, nor D z Rebuttal time. They offer him substantial time on a morning some on one of their morning shows with Formerly With Charlie Rose. Why did they do? And they say And they say in the email Ah, lot of time like we usually give guests three minutes, we’ll give you twice that or something like that and we’ll be willing to talk about other opportunities for you to be on CBS on other shows. Why did they offer that? Did they sense that that they had something wrong? Oh, I know they sensed they had something wrong. I mean, there’s nothing that says it on paper to my knowledge, but there could not be any other conclusion after watching this. And also there were people who talk to Gil. There were some internal e mails from internal emails that I was able to put my hands on that showed that there was something really wrong here. Why would CBS offer them or offer Steve This? This could have been an effort on their part to kind of come clean. But Steve knew that this this was baked in already. I don’t feel like there was any any anything to gain by coming back and fighting that. Oh, I thought he would have taken the opportunity if the board had allowed him to. Oh, well, yeah, but the board didn’t allow him to write, so, you know, I don’t. And he’s been criticized. He’s been criticized for that, Uh, but he wasn’t allowed. You’re right. Now there’s a question. Uh, we could talk about this now. Sure should. Should he have or, you know, where do you, uh, ready to draw the line between obedience to the board and loyalty to the organization and say, Screw the board? I’m going ahead. That’s the last profound question that I asked in the book toward the end. And I think it’s an open ended question. I don’t know the answer to that. Boardmember has, ah duty of loyalty to the organization. Staff member has duties to both the organization and to the board. When you see that the board is going in a different direction. From where you see the organization going, you have a profound dilemma on your hands. One person was extremely critical of Steve for not bucking the board. I won’t use the language he gave me, but that language is in the book. But he said that Steve should have and Al should have buck them and gone public with everything they could at that time. And which person which questions that you know, that was quote okay. Yes, You have a lot, by the way. Lots of footnotes couldn’t you couldn’t have cut the footnotes down 370 foot notes. It’s really got to go to the back of the book all the time to see this. It means a substantial because I was taught in law school. You always read the footnotes. You know that the footnotes used to be in academia couldn’t put them at the bottom. It’s so much easier when they’re the bottom of the page. But that looks bad. People won’t read books like it looks like it. Then it looks like an academic journal. That’s yeah, and it’s important to may toe have these facts correct. And this is not true about a lot of things that are written in general. And so I want to be sure that especially in a situation like this and I was this way with the book on Princeton, too, wanted to make sure that everything that I said was backed up in people new words being backed up. In fact, just to go down that line for a minute. I do worry and always do worry about what I have an anonymous quote. I don’t want people to think I made it up. And so I’ve asked people, attorneys and other people in the world of ethics and non-profits. How do I make sure that people don’t think I did that? And there’s really no way. Just, you know, the authority is otherwise there, so they’re gonna have to take your word for it. It’s like the times when they come out with an anonymous source, got to take their word for it. But that means that eyes the author have to take a lot of responsibility and have a lot of integrity, or try to have integrity anyway in the process. That’s why you have the footnotes Okay. Okay. It’s a yes, I imagine you have. You have a spreadsheet somewhere that says anonymous quote. Footnote number 2 14 Is this person? Yes. Something like that. So, Yeah, I do. We do have to trust you, and your lawyers will never see it. I can tell you that no matter what you do. Okay? You’ve assured everyone a lien on it. All right? So now nor D. C. And reinardy, xero, Dizzy and Giordano, highly rated by the board before this before this occurred. Yes. Talk about that talk about and how wounded Warrior Project was doing. Let’s give them their due now. Wounded. Well, they don’t need their do now. They’re just They’ve always been a great organ. I meant now in the show. Oh, in the show. Just at this point in our time together. Let’s do it. Great organization. It grew from a fairly small organization in the early two thousands. John Milius started it with backpacks out of his basement to take up. He noticed that when he got out of being wounded, Hey, didn’t have any essentials like a toothbrush or a water bottle or things like that. He said I’m gonna put together backpacks and take him up to Walter Reed. He was in Virginia and give them a way. That was really the way it got started. And at the same time, because there was a fellow out in Long Island. Peter Hoener Camp was also concerned about veterans coming back. He started something called Soldier Ride on DDE that raised money for Wounded Warrior Project. So they began to make money a few years after John Milius started it for real. And when Steve and Al came into the scene to really become the leaders of the organization from a staff perspective, they started. They said What? I think all charities need to do more off. They said, What is our task here? And when they defined their task of taking care of veterans when they’re coming back from 9 11 posted an 11 conflict, the money that it would take would be X. And they said, Okay, we’re gonna go out and raise X. It wasn’t like, Okay, we’re gonna raise $1000 see what we can do. What they say. They had an entirely different mindset and a good one, but as you can imagine, Tony. It was somewhat in conflict with the way the mindset works at many charities. So the pursuit of the money became itself something controversial at anyway. They grew and grew, and by the time they left they were earning almost $400 million which is pretty big. They went from 10 to $400 million in a decade, basically, and they had 20 programs. All of them were working. They were quantifying their results and from a an impact respect of the big word today and non-profits his impact. They were already doing it. They were already doing it from a quantitative and qualitative perspective for for many years prior to this point, they were doing a good job, and I think they still are. The vision, I think is reduced, and it’s a smaller organization right now, but it’s still a good organization. I don’t want to say anything bad about the organization today, but it’s a different organization. And nor did see not Dizzy and Giordano, as I said, highly rated by the board. Okay, let me get back to that because you did ask that a few months before they left their ratings and by the way, there prior ratings were all consistent with this. We’re fabulous. They were great. And Steve said, Well, look now I think we ought to slow down and start to become a different kind of order. We are becoming a different kind of organization, so we need to look at it in a more sophisticated way. We’re going to slow down a little bit. We won’t be pushing the gas pedal is hard, and what we want to do is make sure that we’re really serving everyone to the fullest that we can on DDE. That always reflected in those in those reports that the that the board had done on the board hired a firm to do this. And so they all concluded that they were doing a great job. This is just a few months earlier, and so it was really start when when this happened, the crisis came along. The reports just a few months after the glowing review by the board, and then a month later, the board says, we need to change very cryptic and very unsatisfying. In fact, after the two were fired in March, I think was the 16th of March in 2016 Tony Odierno went on the Bill O’Reilly show, and Bill O’Reilly was always a very big supporter of the wounded warrior project. Odierno. It’s board, chair and audio was the board chair, Thank you. And at that point he stepped in. His theory of an amputee also. Yeah, and basically his father was a war hero. He was the head of the military command over there. And so he’s a Tony. Odierno is, I’m sure, a very fine, upstanding, good person. He wouldn’t return any of my phone calls, but that’s another issue. I think that he’s probably a very good person, no reason to doubt that. But he so he came in. He had a full time job here in New York. Kayman is an acting CEO, and he was interviewed by Bill O’Reilly, and O’Reilly said, Why did you fire me? So we needed a change of culture? No, Riley, to his credit, said, Well, what does that mean culture? What it was this culture thing that’s going on here? Well, we really needed a change of culture. I’m making you have the transcript and you have the transcripts segment in the book. Yeah, but basically said that we needed a repeated himself. We need a change of culture, know, really, if you remember him on the show, is kind of a pugnacious fellow, and he said, and this is a friend, you know, This is a friendly interview He said, Well, what does that mean? Again and again, Tony said the same thing. And Cody Bill O’Reilly was just flummoxed. Why don’t you answer this? You’re not answering my question. And he said, Basically, since you’re not answering it, I guess we just don’t have anything more to talk about. Very frustrating and what it really? In addition to your alley’s frustration, the problem was that Tony did not have a good answer because there was no good answer. They were essentially saying the organization in their responses to the reports. The organization is fine, but we need to make a change of leadership. Yes, that was the 22 contradictory statements. Exactly. So you have a report that comes out in March, this report that was done by Simpson Thatcher saying basically everything that the media said was wrong. Still, we need a change in culture. We need a change and so and I got a hold of a letter that Simpson This report, by the way, was not written. Okay? There was no right. It was orelon. But there was a letter written Thio Grassley, Senator Grassley who was looking into this. That’s the letter I looked at. And Simpson Thatcher said, Well, clearly, Odierno, Excuse me is clearly reinardy Z and xero dahna have to go. I’m thinking clearly. What? What’s so clear about that? Everything you’ve said so far is supporting the work that they’ve done. And so where is this coming from? The report vindicated them. The report vindicated. There s so we’re getting to the long marinating hit job theory. Well, the report vindicated them. And as part of that report, they said, Well, there are some some tweaks we should make here. You know, there are some things that as a growing organization, you should do a little bit better. Well, by golly, what organization does not have that is it? It was like policy. Some of the policies and procedures need to be right. Revised, but they’re experiencing explosive growth. I mean, it’s not uncommon for policies the lag behind growth as you’re trying to raise more money and do more programs, and both Steve and Al were seasoned at growing. They knew what they were doing. And so if you take that, you say that doesn’t make sense. What also doesn’t make sense is that a few years earlier, Simpson Thatcher also did a report on the Clinton Foundation, and they were scaling. This is a conflict of interest here. There are no policies. Everything’s wrong. There’s just like it’s crazy now, one scintilla of a recommendation to replace anyone at the Clinton Foundation here. Everything’s going well. We have a few things that we think we should, you know, upgrade. But you know, those two guys that have authored this entire success for the last decade, they need to go clearly. Let’s bring in Richard Jones. That’s a good time for him. He’s on the board of Wounded Warrior project. Uh, still is. I meant at the time. But he still is. Yeah. You say he remained. I didn’t know if he still is today. Okay, I think he’s going off the board at the end of this, Okay? But I think you still think it’s the last line of your book. Richard Jones remained. Yes. Um, but he’s on a couple of other boards and he’s got a He’s got a duty of loyalty to CBS as well. Talk about him. Well, I can only remember offhand right now. One of those two other boards and one was Dixon House. The other was the Veterans Family Institute for Vets and Military Families. E M F. Thank you. And there were a lot of organizations that I implied earlier who didn’t feel comfortable with wounded warrior projects. Growing success. And these were two of them and he was on those boards. And so he comes in. I believe in 2014 or 2015 I get the years a little bit off. It was after the Super Bowl. CBS dedicated the Super Bowl add to the Wounded Warrior Project, and I think he had something to do with it all. Good. So after that, he wants to be on the board of Wounded Warrior Project, and I asked Steve about this and I asked him other board members. Richard Jones didn’t talk to you know, I didn’t see any interview note for them. Well, the interview note that I do have in there is that he didn’t talk to me. Okay, um, when I show what I asked him, I asked all of the boardmember is the same thing, and nobody talked to me. But he was on the boards of these two other organizations that itself wouldn’t so much. It would raise a little bit of a red flag, but it would be disqualifying. I don’t believe, even though they might have known that these other two organizations were in opposition or really didn’t like W W. P. But there’s a lot of that going on. So it’s not the issue. The issue of the day. What really got my attention was that he was also a senior executive at CBS at the very time this was going on. And the criticism that CBS had of Wounded Warrior project was the very area that Richard really Jones was overseeing. I thought there was a conflict there and and a story I still do. You know, I feel it was very wrong, and I I’m I’m really interested in knowing why Richard Jones was allowed to be so much a part of not just wounded warrior project of the investigation that followed. Yeah, you question the board vetting of him when they when they invited him to come on, The fact that he’s a boardmember of two other competing organizations. Well, yeah, I do question esos veteran service organizations. Well, I don’t know that the other two are vey CVS. Oh, that’s a very specific designation. Okay, that’s okay. That same same world. And I wouldn’t call them. I would call him competing in the sense that they didn’t like Wounded Warrior project. They weren’t in the same league. And what I say that I’m not criticizing their size or anything there A lot of small organizations that are doing your job. It’s not that. But he came on and he he wanted a state and al to be fired. I did talk to board members who told me this that they he wanted them to be fired. And he insisted on the unanimous vote that they be fired. He insisted the vote be, you know, he was gonna He threatened to resign. That’s that’s strange. He threatened to resign if it wasn’t a unanimous vote to fire. Nor dizzy. And, uh um, Joe dahna. Yes. And this is, by the way, as a decide one person. It makes it sound so personal. Yes, it does, doesn’t it? Yeah. And then you have CBS doing this hit job, and it’s zee kind of a thicket of crazy questions coming around. All right, we gotta take, uh, take another break. We’re gonna bring in the charity evaluators, charity navigator and charity watch, too. Um, where are we now? We are with, um, Cougar Mountain Software, koegler Mountain. Simple to use. And the support is phenomenal. With a program like quick books, you don’t have support. If you don’t have support, it’s worth nothing. That’s quote Christine Christenson, the owner of Broomfield Cheap metal who uses obviously uses ku Commander. You can’t learn from a small business owner who loves the support at koegler Mountain. Of course you can. They have a free 60 day trial. You’ll find that on the listener landing page, which is at tony dot m a slash Cougar mountain. Now, time for Tony’s Take two your planned giving relationships. Um, when you, uh, inaugurate your plan giving program, you’re gonna be talking to people, mostly in their hundreds. I’ve never spoken to anyone over 100 but I’ve had probably hundreds of conversations with or thousands in all those decades but many, many with folks in their nineties. And, um, some of them are. It could be a little lonely and look for a little, you know, one a little more of your time on the personal side. And that could be a little risky for your plan giving program. And I flush that all out in, ah, my video. What to avoid in your plan giving relationships. And you will find that you know where to find that pizza that tony martignetti dot com and that is Tony. Stick to. Now let’s go back to, uh, Wounded Charity with Doug White, the author, teacher, the author, teacher consultant v. The author, teacher consultant to non-profits and philanthropist. Let’s bring in, um, charting. Navigator and charitywatch don’t have too many kind words. You have some, but not too much for these to charity rating organizations. No, I don’t. I think they should just stop doing what they’re doing. They’re doing more harm than good on that. It’s interesting you bring that up. I mean, they were a large part of the story, but there are a large part of the story in a couple of different ways. It’s because I wrote an article about Charity Navigator that came out in the Chronicle of Philanthropy that week in January 26. That was pure coincidence, right? It was pretty much a coincidence. I had put it in. But then the Wounded warrior project came in and I was able to add a sentence or two. I called Stacey and that the Chronicle. Stacy Palmer, editor dropping names, look atyou, dropping names. I call him Mr Palmer, but you know where Stacy? So we got a line in there. But it came out that week and it was Peter Hoener Camp who had been given that article by a friend of Hiss. And that’s why he called me. And that’s how I got in touch with wounded were how they got in touch with me Now going back to what charity navigator. Is it Zen evaluator way? OK, I don’t like them because they do a bad job. They they do not evaluate charities. They take numbers and they’re competent at dividing and adding and multiplying. But the relationship between those things, that is to say, what is spent on program or how much of CEO is paid or how much is spent on fund-raising or how many assets they have in the bank or whatever that is, is not direct indicator of how charity is doing in terms of its in terms of its work. And so they’ve been struggling with this for a very long time and trying to find this right mix the right algorithm. Well, there is no algorithm. That’s well, well, they have this former formulas and altum they wait certain things. They include certain things. They discount certain things, which is all very subjective. S o they It’s sort of it’s ah, it’s an objective product from a subjective process. You’re So you’re so right about that? I don’t know if you know this, Baxter. You know, I started I had forgotten that. But you, uh you have told me that in the past. Yeah, on dso Ken Berger. Very well. Who was Who was then the chair? I was CEO. Yeah, and I like him. I like him a lot. And I like Pat Dugan who funded charity navigator Pat Dugan had just sold out of his company, and I guess 2000 and that’s when I came out to be a consultant for him for a while, and he said, I want to know more about charities and he’s a good guy and he’s a kind of hardscrabble smart guy and wanted to do more in philanthropy in his life. And he said, If I can get the information, I can get this information out and help people understand how good charities are. And I said, The only thing we have that we can use is information from the 9 90 and there are lots of problems with that. The first problem is that it’s about a year and 1/2 to 2 years old, so you don’t really He wanted a morning star kind of a thing for charities, and it’s not gonna be the same in any way. The information on it is subjective because many people have. But there’s a lot of gray area in interpreting the 9 90 Yes, and finally I said you wouldn’t get married to someone if the only thing you knew about that person was her 10 40. It’s a relationship thes people have with the charity. It’s not just a matter of saying OK, you’re fund-raising efficiency is 20% whereas somebody else’s is better. And therefore, I’m gonna support that charity. I wanna go to a charity that I feel personally invested in in terms of the mission in terms of my own values. And so from that perspective, I said, We’re not gonna get very far in evaluating charity says That’s okay, I get it. I don’t really want anything more at this point. This is what we’re gonna do and besides the only information we have. So we did that. So all of that waiting and all of that has been revised many times. But it was very beginning. That’s what we did. But I always knew that it wasn’t the full story and it would never be the full story. It could never be the full story. Now that isn’t to say there can’t be a full story from other data or other information, but the charity world hasn’t yet gotten there, but that certainly doesn’t do it. But because there’s a vacuum, it fills that vacuum, and so people go to it. And Ken Burgers, predecessor Trump’s Trent Stamp, another super guy in a lot of ways, put charity navigator on the map. And so he became the go to for a lot of media in terms of questions about charities. And I just knew again I like Trent to a great deal. But they would be. He was being asked questions that had nothing to do with his work. A charity navigator like what kind of issues a charity would have with regard to its programs or something like that. And that’s not what Charity Navigator does. Yet it’s become this name of a new organization that knows everything about charities. And that’s not true. Let’s go, Thio. The reports come out, CBS News, New York Times, Charity Navigator and Charitywatch react. Well, What happened first was the charity navigator. Numbers were in the report and shared an advocator. Said that only 60% of the money was going toward programs. And wasn’t this a scandal and everything like that and s. So what happened was I talked to Ken Berger, and that’s in the book to I interviewed him and the reason that number was what it was. And I’m not thinking there’s anything generically wrong with 60%. Let’s get that straight right now. But put that aside for a moment, but it was higher than that because they were not charity. Navigator was not taking into account allocated costs that were being allocated to different Double Double Kid. You gotta read the book for that level of detail. Just get the damn book. But it’s not that complicated. I’ll say xero for readers. But the point being that charity Navigator disregarded both with G A P, the General Accounting Principles General, the accepted A Carroll accepted and the I. R s guidelines for doing this and charted every said. And Ken is very blond about this. We just didn’t take that into account. We just cut it off. So well, that’s not very fair, he said. Well, but the charity head of the opportunity to call us and correct it. So why is it up to them to call you to correct your mistake? Because they were up by almost 50%. It was like 85 instead of 60 was 85. Yes, yeah, yeah, and we don’t want to dwell on that number anyway, you know, there’s the whole overhead myth and, well, there is the biggest hypocrisy because, uh, charity navigator was the signature one of those I know. I had all three of them on the show when the letter when the overhead myth letter came out. Yes. I had Jacob, Harold and Ken Berger and Art Taylor on. Well, the other two were okay, but what did Ken Berger say to defend himself in that he’s the one who created the myth. So now he’s saying, OK, now we’re against that, right? I don’t get that. Yeah, I’m sorry. I’m getting a little bit. But I did have him on the show. That was, uh, October, October 2013. That letter came out. Um, that’s, um, other folks on the show to you. You opened with Dan piela and Brian mittendorf. Yes. Say both of them. They’ve both been on the go. Um, I don’t know what tooting my own horn, but this well, Danza show, do whatever the hell I want. Uh, they’re both good thinkers in this world. So damn very provocative. And he had a lot to say about one warrior project, Of course. Oh, you gotta read the book. You gotta be the book to find out. Exactly. I mean, everybody knows him from the Ted talk about the way we think about charities is what dead wrong. Okay, so we were Oh, it’s a charity navigator. In reaction to the reaction to the bad media charity Navigator puts them on what watch list or something or downgrades them. Right? The watch list thing. This is like This is so bizarre, Tony. I just can’t get my head around it still, and I’ve been swimming in this stuff for about 45 years now. So they put him on a watch list, and the watch list is nothing more than if unorganised ation is in the media in a negative way. They’re automatically put on the watch list because now we have some concerns about it. But now we have some concerns about it. So the funny thing is that a week or two later, right after that’s put on the watch list, CBS does another story saying Charity Navigator’s on the watch list. I Wonder Warrior Project. What? I’m sorry. Yeah, they put on the watch is by charitynavigator. Yeah, and the thing is bad. It was self perpetuating. But the other thing is that the story had nothing about being on the watch list. The story was just a rehash of other stuff they’d already right. So CBS wanted to grab this headline and then did nothing with it because there’s nothing to do with smaller organization Charity Raider Charitywatch. They did something similar. Yeah, they did in reaction to the media. Yeah, and they’re in the same ballpark I feel is charity Navigator when it comes to looking only at the numbers. Dan More shop. I don’t know if you’ve ever had him on. He’s out of Chicago. It’s a much smaller organization right on and again coming up with these ludicrous comments about the way charity should be run and no offence. Well, I guess I do mean to give offense. Let me be frank about my own intentions here. I don’t feel that Daniel Borisov is adding very much to the conversation about the charity world right now, and so I do criticize that, and if he’s going to sit there and criticize expenses, you should look in the mirror because his expenses with regard to his own salary a lot higher than anybody’s with regard to you. Is that right? Yeah, I mean, in relationship to the entire, but it’s like 1/2 $1,000,000. Your organization isn’t a tiny place. Okay, Um, all right. We still have another couple minutes before, uh, before before a break. Uhm All right, so they get this financial audit, it’s Simpson, Thatcher and f t. I. Very clean, with minor policy and procedure to minor things on you point out in a lot of detail the differences between the wounded warrior, project evaluation and the Clinton Foundation, but by the same firm Simpson Thatcher from, um, I guess we should start to, uh, hone in on the board a little bit. Now. You feel like it was left. Everything. Anything major out. I wanted to bring in the Richard Jones character. We left anything out. I mean, they were Well, yeah, jealousy. Okay, let’s take a look it for we analyze the boarding. Let’s look well, hard to analyze the board without Richard Jones being a part of it, and vice versa. But in terms of Jones role here he was the head of the audit committee, right? He’s the head of the Dam Art Committee that oversees the production of the 9 90 Yes, and he’s He’s flabbergasted by by these thieves. Media reports about overspending and lavish conferences. I’m sorry. Come back to take a break. Yeah. Let me get a break in. Because I know you’re on a roll for our last break. Turn to communications, PR and content for your non-profit. They help you tell your compelling stories and get media attention to those stories on and build support for your mission and your work. They do media relations, content marketing, communications and marketing strategy and branding strategy. Doug and I were talking about the Chronicle of philanthropy, and the assistant editor of Chronicle of Philanthropy is former assistant editor Peter panepento is a principle of turn to communications there. Turn hyphen to dot CEO. We gotta get the live listener loving Doug White. You brought, uh, you said you were out soliciting listeners. We got a lot of lot of live love going out. Thio Duncan, South Carolina, New York, New York Glenside, Pennsylvania, Jacksonville, Florida, Charlotte, North Carolina. Close. Thank you. Close to Emerald Isle. Tip of Florida Tampa floor. Like I’m 14 my voice breaks Atlanta, Georgia in New Bern, North Carolina Even closer. My goodness. Live love to there. Um, before we go abroad, Wallingford, Connecticut, and field Connecticut, Oakland, California, Arlington, Virginia. Franconia, Virginia. I know. Franconia. I think I might know that is, uh, somebody might actually be listening to me instead of you, Doug. 11 person. Uh, maybe this too. Uh, live love out to all of you. Philadelphia P A as well. Huntington Park, California And thats everybody, you know, and, uh, Br What is this? California. Where That br What you’re writing there. Braila. Braila, California Live love to all our domestic live listeners. Thanks so much for being with us. Let’s go abroad. Thio El Salvador. Guatemala. Lord is Guatemala multiple Guatemala. Welcome. Welcome. Live love to you Guatemala. Um Brasilia, Brazil. So Juan Korea, Inchon, Korea and, uh, Machado’s Brazil as well. Wonderful. Multiple Brazil, multiple Guatemala. And, of course, our friends in South Korea. Always checking in live love to each of our live listeners. Thanks so much for being with us and the podcast pleasantries. That’s where you know. Not that we’re focused strictly on the numbers, but the vast majority does listen by the podcast live listeners. You’re welcome to join the podcast as well for times when you can’t catch us. Friday 1 to 2 eastern time join the over 30 13,000 people listening live listening on the podcast. So the pledges trees the pleasantries and the AMA said pageantry is but the passing key pattern trees and the pleasantries go out to the podcast. Listeners, thank you for being with us. Got butt loads more time for, Ah, Doug White and, uh, wounded charity. Okay, um, I got so effusive, but I forgot. Over what? What was I? Oh, that’s right. This guy, Richard Jones, is the chair of the audit committee, for Pete’s sake. Yes, go ahead, Tyr, the audit committee and you have to go back and look at that broadcast that CBS did that first night, but also all three. But in that first night, and it was like, Shaq, you’ve got this terrible 9 90 out, and I’m shocked, shocked to learn that there are in proprieties financial proprieties at the wounded warrior project. But the fact is, there weren’t any minute they weren’t that. In fact, they did a evaluation of all of the budgeting for the prior seven or eight years. An audit. They didn’t find anything out of place, Not a dime. That’s right. I gave a bad remark. That was a bad film reference because the French lieutenant’s exactly what’s going on. It is bad and yeah, that was That was a bad reference. That’s okay, because of what? It really wasn’t any gambling going on in this in this there was not. But but Richard Jones was a boardmember and was also a senior executive at CBS and also very involved with the veterans community is a highly regarded guy. I mean, you know, when it comes to anything personal or anything, nothing there. I wanna be clear that I have found nothing in these people’s lives. That or anything but stellar. But in terms of evaluating what happened here, we have to be clear. Yeah, it was It was a crisis and people reacted badly and the board, collectively failed, failed the organization. Right? And I would also be clear about that with regard to, as I mentioned before, Dave Phillips and also Chip Reid. Stellar reporters Chip Reid was the CBS Carson, this guy. So getting back to Richard Jones, the report comes back orally. Remember that it’s not been anything delivered in written format, and there’s a news conference that the wounded warrior project has on March. I believe it was 9 March nine and says this is what the results were. And on top of that, we’re getting rid of our two top guys that same night that came through. But during that month, when that that audit was taking place, Richard Jones was involved in the interviewing process. So here he is being involved in the interviewing process, along with Simpson Thatcher on matters that he was very much overseeing very much a part of overseeing at Wounded Warrior project, about how CBS had had written and reported its stories. So there’s, you know, I’m not stretching for this one. There was a conflict of interest there. He had a duty of loyalty to both his employer and because of his board relationship with Wounded Warrior Project duty of loyalty there. Yes, he did, as well as Karen Obedience. That’s correct. So the question that I have never been able to ask, even though I did accept the answer even though I did ask it, is why he was permitted to do that, why he wanted to do that. I suspect a couple of things. One is he could do whatever you want to do because he’s boardmember and you know that’s what they do. Sometimes he was also very influential. I think that and I wasn’t able to really put thes two dots together. But I think that his having been somewhat instrumental in getting the Super Bowl ad brought him into the full W W p. And nobody really thought anything about it at the time and even asked Steve, how did he come into the board? And I asked him, boardmember is how they how he came into the board and they really couldn’t remember any kind of moment. But one boardmember said that he was very upset that Jones did not disclose his relationships with the other two organizations. So here he is, and I’m thinking something is going on here. But that was on the relationships worrying his LinkedIn profile. Those relationships wearing Richard Jones is linked in profile. That is correct. The board would not have had to dive deep too far. You don’t need a private investigator to find those you’re making good pose board relationships. Yes, you are making good point for a moment there, after I had badgered him with thes e mails. I think his LinkedIn profile became not public. But then I went back. About a year later. It was there. So maybe it was my fault, I don’t know. But at any rate, he was in a curious place in this whole drama here. And so I began to wonder, Did this this ousting process begin? Well before this crisis and was the crisis basically invented? So I’m thinking that it waas on. It was fairly easy to get some disgruntled employees, but I don’t know why. Eric Millette, the face of the of the CBS reports, came out to be so negative against Wounded Warrior Project after he himself had been so effusively positive about Wounded Warrior Project had been rated best charity to work. That’s that’s all comes from employees ratings. Yes, I’m not making any of this stuff as I am, he’s saying, Oh, I have great thoughts about W. W. P. This is all external stuff, right? It was a couple of years in a row or something. It was it was number one or number two number one charity to work at for a couple of years in a row in there, like the top five for others. But there was this Facebook page of disgruntled employees who felt that there there was. There were firings for trivial reasons. And they felt if you didn’t fit in, you got fired, right? Is that the basis of basically what their complaints were? That is what their complaints were. But it’s funny because the firings were for cause and there is some fairly big deal firings. One guy was caught stealing from the from the till fundraiser, and two people following that were fired because they allowed it to happen. They knew it. And so it was the opposite of what you’d find in a scandal. They were doing everything you should just to stay clean. Al was really on top of that. He would. And the other thing I want to be clear about here is that these people loved Alan. Steve, Steve, Steve was in a very public place and and Alice always been in the operation side of it. But in my interviews, I don’t think I had one person that I interviewed who wouldn’t didn’t go out of his way to say, you know, if it weren’t for Al here, he is the CEO of this multi $1,000,000 organization. Hundreds of millions of dollars of or he’s the second guy CEO Seo. And he’s he’s taking time to get me through this crisis or that crisis or worked with the V A. They used to make calls. They would make the calls to some of the recipients of the services. Yes, because at its core, W, W, P, and all of the V esos and others exist because VH has some cracks in it. That’s yeah, that’s that’s flushed out of the booth. Got a by the book to get you to get that detail. There would be cracks no matter what. But there’s severe crisis. So Alice going through in trying to help them navigate this Byzantine system and they love for Al. It was overwhelming, all right, we need to switch to the board. Doesn’t wanna spend time positivity and bored, and what the board should have done it so clearly the board should not have silenced do not have been silent itself on. Dhe should not have silenced. It’s to it’s to talk to duck guys. Steve went to Tony, Tony oh, tea or no and said we have to have a strategy here. And he had already created some outlines for a strategy with Live Strong. And I think Coleman and another group who had gone through crises and what the fund-raising resulted in from that and they were not interested in pursuing that. Now they have the crisis coming up there. They’re winging it and doing a bad job of it, right? He had encouraged crisis management training long before this all happened. Yes, and they didn’t invite eso. No crisis management training could be very valuable for you, For you, for you and your board. That’s right. And I will speculate, and I have to label. This is speculation or opinion or whatever. I believe that the crisis was somewhat manufactured, right? Well, that’s the long marinating his job. So the board Okay, so you want to get to the board and I taught board governance for 20 years at N Y. U and Columbia. I still do this Southern University, so I think, and I think board governance is where it’s at when it comes to really understanding. Non-profits and non-profits don’t really advertiser. Their boards are. It’s always the CEO. It’s out there in the face of the public. And so we really don’t know what boards do or who they are, which is, I guess, OK, But they are your listeners to know they’re the guys who are really running the show from a strategic and long range perspective. And so they really are the decision makers when important issues come up on. And in this particular case, they, I think, made a lot of bad decisions. And, uh, toward the end, I think they let Steve and Al do what they needed to do. But Allen Steve always made sure that the board was on board and that the board’s suggestions and opinions were always taken into account. And there are examples in the book where that is proven to be true. So, boardmember, who says Stephen Al just flew off? We had no idea what was going on is demonstrably false. Yeah, that all these right? All the lavish conferences the board had approved the conference expenses. You point that out? Yes, and they were sighted at $3 million they were under $1 million in one example Almost almost 30. Yeah, Exactly. Okay. What else? What else can. Non-profit takeaway. Well, board wise, it’s not. Everybody’s going to be in the cross hairs like Wounded Warrior Project. So it’s It’s a specific organisation there, but any organization can be caught and to be in trouble. So what should be? What should aboard do? The board should have a tremendous relationship with its senior staff. If there’s a bad relationship with the senior staff that has to be taken care of before anything else is done, that might mean getting rid of a few board members that might be get mean, getting rid of the senior staff. Make sure that’s there. The thing is, the thing about this is that was the case. There was a good relationship between Steven now and the board. But the problem is, and I think this is where Richard Jones played an oversized role in the whole process. They were allowed Thio fire these guys a Ziff. They deserved it and they didn’t deserve it. And so the board, the board has to be on top of this from a public relations perspective as well as an operational one, in my view, and the public relations perspective is not unimportant, it’s not just the dressing on the whole thing. It’s what’s really ruined. Or, I should say hurt. Not ruined. Hurt. Wounded Warrior project. Since that day, they have lost over 1/2 a $1,000,000,000 in revenue. The half 600 I think $50 million in revenue from that day in the last three years take caution. Get the book because there’s there’s a lot more detail that we were not able to cover. It is wounded Charity lessons learned from the Wounded Warrior Project Crisis, published early October, But you can advance by it on on Amazon. I know for a fact again, he’s Doug White, author, teacher and advisor to non-profit organizations and philanthropists. Thank you so much, Doug. It’s been a pleasure to see you again minded get mine as well. Next week, I’m working on it. I have I ever let you down? There was that one time with the fermentation show, but that was so long ago. I was I was only 52 then. Youthful indiscretion on that show. Um, if you missed any part of today’s show, I beseech you, find it on tony. Martignetti dot com were sponsored by Wagner CPS guiding you beyond the numbers record. Cps dot com by koegler Mountain Software Denali Fund Is there complete accounting solution made for non-profits tony dot m a slash Cougar Mountain for a free 60 day trial and by turn to communications, PR and content for non-profits, Your story is their mission. Turn hyphen to dot CEO. A creative producer is Claire Meyerhoff. Sam Liebowitz is the line producer. Shows Social Media is by Susan Chavez. Mark Silverman is our Web guy, and this music is By Scott Steiner, Brooklyn. They’re with me next week for non-profit radio. Big non-profit Ideas for the other 95% Go out and be great. You’re listening to the talking Alternate network. You’re listening to the Talking Alternative Network. Are you stuck in a rut? Negative thoughts, feelings and conversations got you down. Hi, I’m nor in Sumpter potentially ater. Tune in every Tuesday at 9 to 10 p.m. Eastern time and listen for new ideas on my show. Beyond potential Live Life, Your Way on talk radio dot N Y C. 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