Why Good Governance Matters

Sometimes executives at charitable organizations begin to view them as their own personal fiefdoms. It is as if they feel like entrepreneurs, who started the business with their own money and therefore have the right to make or delegate all the decisions—and also to dip into the checking account when it’s convenient. There have been numerous instances of leaders of small charities who have done exactly this kind of thing. Because there’s often a lack of a formal bureaucracy in charitable organizations, the person may just began to feel that the board does not need to be consulted. Even at the largest charities, the controls are not always what they should be, and charismatic executives have been known to engage in more individual decision-making than is healthy for the organization. Almost always, when things go bad it’s because the board’s oversight isn’t what it should be.