Whilst early 2018 has seen the UK’s business sector shaken by quite a few shocks already – for example, the collapse of Carillion, the death of some big-name retailers like Toys R Us, and (as I write this) a claim of misconduct against the CEO at global ad agency WPP – the country’s charity/non-profit sector has had quite a few scandals of its own to deal with. Inadequate safeguarding and sexual abuse have, sadly, been at the centre of the charity scandals, but that’s not been the only issue.
Firstly, there’s been the scandal around the treatment of women at an all-male annual dinner of the President’s Club from whom several UK charities had accepted donations (one charity – Great Ormond Street Hospital – at first decided to return monies, but has since decided to keep the donation – rather making a mockery of themselves!).
And there’s been the major scandal, of course, at Oxfam, where it has emerged certain senior staff based in Haiti back in 2011 paid local women for sex in the context of dealing with a horrendous earthquake that had hit that country. That shocking affair swiftly led to other cases coming to light at additional charities of inappropriate treatment of women by senior managers – in particular, at Save the Children. As I write, the RNIB is the latest charity to be found seriously wanting on the safeguarding front, with the Charity Commission opening a statutory enquiry into its poor management of a Coventry-based school and care home for disabled children, following the occurrence of several serious incidents there in the previous year and allegations that pupils were not safe.
Alongside these two scandals – although not quite as serious – there has been an embarrassing governance crisis and farce over the last few months at the Institute of Directors, one of the UK’s leading business membership and representative bodies. The top brass there seem to have lost the plot in terms of supposedly being an exemplar to the country for good leadership and governance.
The Oxfam scandal was the most troubling, in my view. With no wish to delve into all its details, there seem to have been several internal HR and managerial weaknesses for which the charity merits serious rebuke. These include, most obviously, lack of rigorous processes for selecting and vetting key senior appointments (notably that of the Oxfam director for Haiti); poor HR processes for overseeing country managers’ performance; allowing some Oxfam staff found guilty of misconduct to resign and leave ‘quietly’ rather than sack them (including the Haiti country director); an ineffectual whistleblowing policy for Oxfam staff to raise concerns; and generally poor safeguarding checks/processes.
Telling for me, in particular, was how Oxfam’s former head of global safeguarding between 2012 and 2015, Helen Evans, apparently raised her concerns repeatedly with senior management about sexual abuse by Oxfam employees both abroad and at home, but her concerns apparently fell on almost completely deaf ears in the Oxfam executive suite.
The biggest criticism of Oxfam, however, is arguably how it has handled this crisis externally. In short, the charity has come across as aloof, defensive, too inward-looking and, arguably, arrogant. Firstly, the charity did its best to keep quiet – certainly out of the public domain – how back in September 2011 six members of its staff left the charity after being found guilty of serious misconduct. It has been criticised for not informing other charities involved in aid work about the individuals concerned and only very passively reporting the instances of misconduct to the Charity Commission.
Secondly, in February this year, when The Times broke the story about the Haiti case, the charity’s senior management seemed to want to ‘brush off’ what had happened. Rather than use the wise PR approach of “full and apologetic” disclosure of what had happened, the charity’s leadership came across as hesitant and defensive in referring to what had happened. Indeed, Mark Goldring, Oxfam’s CEO, tried to deflect criticism by claiming that people were “gunning for the charity and the reaction to the scandal is out of proportion to the level of culpability” and sufficed to say that he was launching an action plan to improve the charity’s safeguarding processes.
This was very unimpressive for the leader of a major world charity brand: no wonder several thousand regular donors to Oxfam have since advised they are abandoning the charity and no wonder the International Development Secretary, Penny Mordant, said on the 12th February that future government funding to Oxfam was in danger and called for the charity’s leaders to start to demonstrate the required moral leadership to address the scandal. For its part, the Charity Commission responded to the widespread criticism by opening a statutory enquiry into Oxfam.
Another issue is that Goldring himself failed to resign his post and show accountability for what had happened at the charity. As the previous International Development Secretary, Priti Patell, remarked, this is what one would have expected of a leader of a major, international charity which had been found guilty of a betrayal of trust of its beneficiaries, volunteers, staff and the general public. Instead, Goldring left it to his deputy, Penny Lawrence, to ‘carry the can’ by resigning – using the line that she was international programme director for Oxfam in 2011.
This compares strikingly to how the CEO at the blind people’s charity RNIB, Sally Harvey, resigned very promptly early April following a public announcement from the Charity Commission that her charity may have “consistently failed” to follow child protection regulations and that it was opening a statutory enquiry into how it (and a subsidiary charity) had been running a children’s home in Coventry. Harvey had only been appointed CEO as recently as October 2017, but she was accepting responsibility as the charity’s most senior executive: this is what CEOs are meant to do! Also justifying her resignation is the point that, although she was only made CEO very recently, she had apparently been acting head of the charity for a year up to that time.
What happened around safeguarding at Oxfam is serious enough, but I wonder if there’s a wider issue for the charity sector as a whole – beyond just safeguarding – at least for large charities. Don’t charities need to be more open and transparent and more willing to be sensitive to and accept external criticism ? The answer is a definite ‘yes’ according to two well-informed commentators on the charity sector: Rob Wilson, Minister for Civil Society between 2014 and 2017, and Vicky Browning, CEO of ACEVO, a membership body for leaders of 1,200 UK-based charities.
Wilson asserted in a recent Third Sector magazine interview that “big charities …. are preoccupied with their public image and are automatically hostile to anything that might affect the relationship with their donors. They need to take a long, hard look at themselves: many of their problems are cultural and not systemic throughout a very diverse sector. Trustees must insist on the openness and accountability of their charity”. For her part, the ACEO boss argued in a recent interview with The Guardian that charities have been given the benefit of the doubt for too long: “the sense that we are slightly untouchable because of the nature of our work has gone”. She believes charities need to be fully open and be ready to explain themselves fully. Her view is that Oxfam’s mistake was that it was not open enough over what happened in Haiti in 2011: “If you are going to be transparent only about some of the things …. that’s not good – that can be dangerous”.
Meanwhile, in the domain of membership body, the Institute of Directors, the air has also been tense amidst an alarming string of allegations covering racism, sexism, bullying, and harassment levelled by a range of IoD staff against the chairwoman of the organisation, 71 year old Lady Barbara Judge. The claims apparently included the remark “The problem is, we have one black and one pregnant women, and that is the worst combination we could possibly have”. The claims were investigated and detailed in a report by law firm Hill Dickinson, which also found that Lady Judge had failed to act as a truly independent chair by “exerting undue/inappropriate influence and applied underhand tactics to make her points in breach of corporate governance standards”. Serious stuff!
The scandal led to Lady Judge resigning, alongside deputy chairman Sir Ken Olisa and another non-exec, Arnold Wagner, both of whom had backed her. At first, she had volunteered to step aside to allow her to contest the claims against her, but she was promptly suspended by the IoD’s Council after its senior independent member, Dame Joan Stringer, sent a tape recording allegedly containing racist and sexist comments made by Lady Judge to council members. Lady Judge accepted that some of the language she had used had sounded “crude and insensitive” and “not of the modern standard” but the taping of her words had been “entrapment” and she had not been given an opportunity to defend the report’s findings before they were made public. She considered she was a victim of an internal conspiracy against her by Dame Joan and the IoD’s director-general. For her part, Dame Joan believed the investigation had been fair.
What an embarrassing fiasco! The IoD has made itself a laughing stock – or, more precisely, its top brass has – embroiling itself in a governance crisis and engendering both professional and public ridicule which it should have been savvy enough to avoid in the first place. Apart from its senior leaders looking rather too aloof and superior (arguably with rather too many Ladies and Sirs to be fit for being the voice of the modern, average business in the UK today), what has happened undermines hugely the IoD’s purported role as one of the leading voices and champions for good corporate governance and leadership! The self-focused antics of its senior leadership will lose the organisation a lot of essential credibility. Not least, also, because it was Sir Ken Olisa himself – the IoD’s vice chairman, no less – who was the author of the IoD’s “good governance report“. What a farce!
Overall, although the Oxfam and IoD cases are different in many of their issues, I think they both involved their senior leaders coming across as weak and self-absorbed rather than thinking more about the effects of their actions on the wider reputation and credibility of their organisation. Some might call this arrogant and blinked thinking on their part. Such thinking can occur, of course, at other charities and membership bodies where politics and egos inevitably come into significant play at senior levels – I’ve seen this particularly at some professional bodies where there are no external lay trustees on the Board). A key part of the answer has to be to ensure these organisations are sufficiently open and transparent externally, as well as efficiently run and ethically-led. Their top leaders must absolutely not be allowed to be leaders who are inward-thinking and self-focused. Particularly with charities, the general public expects the highest standards of governance and accountability.
To achieve that requires charities and non-profits to have an effective mix of organisational culture, HR systems and wider/supportive policies and procedures to operate alongside, guide and keep in check the style, actions and deeds of its senior leaders. In the political and multi-layered world of charities and member bodies, undesirable things can only be thwarted if there is a holistic set of organisational elements working together. Culture (e.g. promoted values/beliefs, management style, what gets recognised/celebrated, how good communication is, respect/openness between people) is particularly important because processes and policies, in themselves, can only go so far in preventing poor conduct.
The main hope from all the above issues, of course, is that Oxfam and other charities do as much as they can to improve standards of safeguarding, where lacking. But, at the same time, it would behove all non-profits to think about and check how sometimes their top leaders conduct themselves and how sensitive they are to what the external world is thinking of them!
Written by Mike Owen
Copyright of Owen Morris Partnership
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