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A Crisis of Confidence in our Nonprofits

In last month’s blog post, Is Your Nonprofit Prepared for a Crisis?, I wrote about the need for organizations to develop a crisis plan. I wrote the article in response to the September shooting at the Navy Yard in Washington, D.C., an event caused by external factors.

But there is a second type of crisis, one that is caused by an internal situation. Susan G. Komen is a perfect example, where a management decision quickly made national headlines and incited public outrage.


A little over two weeks ago, another crisis hit the national headlines, one that arguably is far worse than Susan G. Komen or a crisis affecting a single nonprofit entity. On Sunday, Oct. 27, readers awoke to the following lead story in the Washington Post: Millions lost by nonprofits, with little explanation. The story jumped to the inside of the paper — two full pages — complete with photos, a timeline outlining fraudulent activity and damaging details revealed in 990 forms (full disclosure: the data was provided by GuideStar).

The article recounted the story of the alleged $3.4 million embezzlement of funds by an employee at the American Legacy Foundation, the nonprofit created in the late ‘90s in response to the government settlement with tobacco companies to help educate the public about the dangers of tobacco use.

While a central focus of the Post’s investigative report, the American Legacy Foundation is one of a number of nonprofits cited in the article for illegal deeds ranging from embezzlement to investment schemes to purchasing fraud, all activities that resulting from employee misconduct.

This type of expose can be damning to an entire industry, especially one that is mission-based.

In a crisis, as a PR practitioner, your job is to protect the organization; you can’t always protect the people associated with the organization. Your primary responsibility is to help restore the brand of the organization as quickly as possible.

To help mitigate the damaging effects of a crisis, organizations should take the follow actions immediately:

1) Own up to the misdeeds, no matter how horrific and embarrassing;

2) Inform all stakeholders about the specific steps you are taking to rectify the situation; and

3) Stay true to your word, don’t simply hire “spin doctors” or attorneys to get you out a mess and expect to get back to business as usual.

Sounds simple enough, but the above actions take courage, and many organizations simply don’t step up to the plate for a variety of reasons.

But it’s important to keep in mind that the public has an amazing ability to forgive foibles, regardless of how egregious. What they don’t forgive is repeated offenses because apologies then become merely empty promises. The saying that actions speak louder than words, while cliché, is true.

When the story broke, I was particularly encouraged by what then American Legacy CEO Cheryl Healton said: “We’re not innocent in this. We are horrified it happened on our watch…we screwed up.”

That is exactly the kind of open, honest and transparent communication people need to hear. My guess is Dr. Healton’s legal team was both horrified and terrified she made such a public statement. However, it was the right thing to do and, frankly, the only thing to do so the American Legacy can begin the road to recovery and restore the public’s confidence in the organization’s mission.

But perhaps Dr. Healton came out with such a public statement because she already had announced she was leaving her position in January 2014 to join the faculty of NYU. Though it’s interesting to note that her successor, Robin Koval, assumed the helm mere days after the Washington Post story came out.

Regardless of the specifics, Ms. Koval certainly has her work cut out for her. Now let’s hope the American Legacy’s actions as spoken by Dr. Healton — along with the actions of the many other nonprofits cited in this article — speak louder than words. The public needs to regain confidence in its nonprofits and the great work they do.

 

Karen Addis Karen Addis, APR, is senior vice president at Van Eperen & Company, a full-service public relations and marketing communications in the Washington, DC, area. You can contact her at kaddis@veandco.com. You can also follow her on Twitter at @karenaddis or connect with her on LinkedIn at http://www.linkedin.com/in/karenaddis.
Topics: Communications Management Press