Several days ago, many of us became aware of a very troubling story out of Oklahoma. A Chamber there was coming under some significant (and well-deserved) scrutiny for practices most of us would find shocking. The local news was reporting that there had been no audit of the Chamber since 2003, federal payroll taxes were last paid in ’07 and state payroll taxes were last paid 4 years ago. As you can imagine, the state Bureau of Investigations is looking into embezzlement concerns, along with all the rest of it. The Chamber director resigned and there are calls from the membership to have the entire Board of Directors follow suit.
While I’m quite sure nothing like this is going on at YOUR Chamber, I wonder if we might learn a few lessons here. Let’s break it apart and see what we can find.
- Transparency is MANDATORY: The Board has a fiduciary responsibility to the Chamber, and that means KNOWING what is going on. The membership should never feel as if things are going on behind their backs. There are certainly some discussions that go on behind closed doors for a reason, and privacy concerns must be handled appropriately, but even the APPEARANCE of impropriety is cause for deep concern (and many job openings, unfortunately) that could be alleviated by simply keeping everything and everyone above suspicion. Open the doors and let people see the good, the bad and the ugly. Remember, given a level playing field, people will do business with someone they KNOW, LIKE and TRUST. Don’t take those three things away from your members by closing doors and hiding conversations. I’ll trust you FAR more if you tell me there’s a problem and offer your solutions to it, than I will if I uncover the problem you tried to hide from me.
- Get your people involved: We know of Chambers where the staff isn’t allowed to attend Board meetings. Someone tell me how that makes sense, because I can’t figure it out. If there’s something sensitive to be discussed, do it at the end of the meeting and excuse the rest of the staff a few minutes early, but having your membership director sitting back at the office while the Board talks about Membership is counter-productive. The same could be said about a finance manager not being there when budget discussions are going on. Your Board should provide direction, while your staff carries out the mission. How can they do that properly if you don’t allow them a seat at the table to hear what is being asked of them?
- Use the tools at your disposal: There should be no argument from the horror story above that had regular annual audits of the Chamber been done, this would have been caught much sooner, and the organization wouldn’t be in the precarious position it finds itself in today. While I understand that a full audit is not legally required and can be VERY expensive, audited financial statements are a good (affordable) alternative to annual audits. Another great resource for you is the US Chamber. I would recommend EVERY Chamber take a look at the Accreditation process (even if you don’t plan to incur the cost of applying, at least use the self-analysis process to evaluate your organization’s strengths and weaknesses) and their list of Best Practices, which is a repository of GREAT examples of Board governance documents, Finance and HR principles and a whole lot more.
At the end of the day, we all want to protect our Chambers and our members. While we can’t all afford to do EVERYTHING…we can all afford to do SOMETHING. I challenge you to do something today to protect the long-term stability and sustainability of your organization.
We want to hear from you. What are YOU committed to doing to strengthen your Chamber or Association today?