Nonprofit Chronicles

Last night, the Chronicle of Philanthropy published a long story about the Silicon Valley Community Foundation that I wrote with help from Megan O’Neil, the news editor at the Chronicle.

The headline:

A Star Performer Created a ‘Toxic Culture’ at the Silicon Valley Community Foundation, Say Insiders

An investigation is looking into reports of bullying, sexual comments, and an oppressive office culture….

This afternoon, Loijens resigned, the foundation has confirmed. That was fast. It is not and should not be the end of this sad story.

The Chronicle story is based on interviews with 19 former employees of the community foundation, which, with $13.5bn assets under management, is bigger than the Ford Foundation. Those ex-staffers “accuse Mari Ellen Loijens, the foundation’s top fundraiser, of engaging in emotionally abusive and sexually inappropriate behavior, and they use words like ‘toxic’ and ‘terrible’ to describe the workplace over which she presides,” the story says.

This blogpost is about the story behind this story. It explains the challenges of reporting on a big foundation like the SVCF, and points to problems in the way Emmett Carson, the foundation’s CEO, has responded to the allegations.

First, I must say that I’m grateful to the Chronicle for publishing this story. It’s behind a paywall, so I can’t share most of it with you, but please consider subscribing to the Chronicle. It’s one of the very few places that reports on foundations and nonprofits. Importantly, it has the respect and the reach to hold them accountable.

The story begins with an anecdote:

Not long ago, the actress, author, feminist, and activist Rose McGowan —- who said last year she had been raped by Hollywood movie executive Harvey Weinstein — visited the Silicon Valley Community Foundation to consider opening a donor-advised account. A disgruntled staff member told her to look at the foundation’s reviews on Glassdoor, a website where workers anonymously rate companies and their management.

The reviews there are abysmal, citing high turnover, a “toxic culture,” “lots of scapegoating and blaming of staff,” and claims of sexual harassment.

“The reviews caused me to not do business with them,” McGowan says.

It was a rare setback for the fast-growing Silicon Valley Community Foundation.

The story goes on to describe in detail how Loijens belittled staff, made lewd comments at work and, on one occasion a decade ago, told a woman who worked for her that she wanted to kiss her. [Loijens is married.] Six former employees of the SVCF are quoted by name; they deserve credit for sticking their necks out on behalf of others who suffered what many experienced as abuse from Loijens.

The man in charge

The question now becomes, what is the responsibility of Carson, the high-profile CEO of the community foundation? To paraphrase a line made famous during the Watergate hearings: What did he know and when did he know it?

First, a bit of  backstory.

I knew nothing about community foundations until last spring when Eric Nee, a former colleague of mine at FORTUNE magazine, asked me to write about the SVCF for the Stanford Social Innovation Review, where he’s the managing editor. That story, headlined The Charity That Big Tech Built, explained how the SVCF had become a repository for donor-advised funds from wealthy people in the Bay Area, including Facebook’s Mark Zuckerberg. It aired complaints that the SVCF did not do enough for local charities. Carson, who does not take criticism well, was displeased, and he wrote a rebuttal for the Chronicle of Philanthropy. Phil Buchanan of the Center for Effective Philanthropy weighed in, too.

Last September, I got an email from a former employee of the SVCF who, then and now, wishes to remain anonymous. S/he wrote:

I can’t say anything on the record (SV is too small, and retribution is a fear given prior bullying tactics of SVCF’s leadership). I wonder if there are public records acts requests that could allow you to look at prior HR legal challenges. There were numerous people who were harassed by Emmett’s second in command over the last decade…Is any of that public? Again, it will be tough to get anyone on the record but plenty of people willing to talk on background.

I put him/her off. The allegations were a decade old and foundations aren’t subject to public records laws. Arguably, they should be, but that’s another story.

A failing report card

On January 9, at the height of #metoo, the tipster emailed again, this time with a link to reviews of the SVCF on GlassDoor. These are anonymous reports, so they must be taken with a big grain of salt.

But SVCF’s reviews are so negative, and its rating is so low that they got my attention. The SVCF currently has a 15% approval rating, meaning that just 15 percent of the reviewers recommend working there. For context, I looked at foundations, nonprofits and companies, including some known for their demanding workplaces, and found none as low. These are unavoidably imperfect comparisons, but here are some numbers: Facebook (94% approval) Ford Foundation (90%), Uber (84%) Hewlett Foundation (79%), Amazon (74%) United Way (71%) Gates Foundation (66%), McDonald’s (56%), Walmart (55%) and the American Red Cross (43%).

I began to track people down who had worked at the SVCF, some referred to me by my tipster and other that I found on my own. [LinkedIn is a wonderful resource for reporters.] I was wary of being passed from one disgruntled person to another, and managed to find a handful of people who like working for Loijens. Those satisfied employees one declined to be interviewed. I can only surmise that they did not want to diminish the experiences of their former colleagues. In any event, treating some people well does not excuse treating others badly.

The stories that I heard from most of the former employees were egregious,  but none of the first dozen or so people who spoke with me would permit me to use their names in the story. For reasons that I still don’t fully understand, they said they feared retribution from Loijens or Carson. They also worried about getting on the wrong side of potential future employers.

I didn’t think a story relying entirely on anonymous stories would merit publication in The Chronicle or have much impact. Then, last month, Elizabeth Dressel, an lawyer who worked at the SVCF for about a year, agreed to an on-the-record interview. Others slowly came around.

Then this happened:

April 2: I file a draft to The Chronicle. Stacy Palmer, the editor, plans to moderate a panel with Carson later that week. We agree that, to be fair, she will tell him about the story face-to-face.

April 6: Stacy Palmer tells Carson that the story is coming. The rest of their conversation is private. I’m guessing he is not pleased.

April 12: Palmer asks Megan O’Neil to work with me. We continue to report the story and seek a response from the SVCF. Megan secures a key interview, confirming the outlines of what I’ve learned.We email Sue McAllister, the SVCF’s marketing director, seeking interviews with Carson and Loijens. You can read our subsequent email exchange here.

Carson’s initial response

April 12: David Callahan of Inside Philanthropy publishes a story about the SVCF with the headline, Why is this giant community foundation–and its leader–so controversial? He cites the GlassDoor ratings and mentions Loijens. Carson responds by email:

While we cannot verify any anonymous reports through third-party forums like Glassdoor, we conducted an anonymous employee survey in December 2017, which 90 percent of our staff participated in, which showed 89 percent feel they have good working conditions, 94 percent feel safe in the workplace, 85 percent feel their supervisors treat them with respect, and 84 percent feel their supervisors help them handle personal issues at the workplace satisfactorily, among other positive findings.

Unbidden, Carson also tells Callahan, by email:

We can also affirmatively state that there have been no formal reports of inappropriate conduct involving any employee at SVCF.

Keep that in mind as you read on.

April 16: In response to our request for interviews with Loijens and Carson, the SVCF’s Sue McAllister writes:

The specifics that you have shared with claims of sexual harassment are deeply concerning for SVCF, and as a result we have retained the services of Thompson Hine LLP to do a full investigation of these claims and the alleged behavior of Mari Ellen Loijens.

Carson declines to talk but McAllister invites us to submit questions by email.

April 17: Before responding to us, Carson publishes a “Statement on Allegations of Workplace Misconduct” on the SVCF website. He says that he is “fully committed to further cultivating and ensuring a safe workplace and a culture that is inclusive and open.”

The statement says that Thompson Hine, a national law firm, has been hired to look into the allegations. It does not mention the name of the lead investigator or tell former employees how to get in touch.

Some former employees are contacted by HR at the SVCF and invited to talk with Sarah Hall, a senior counsel at Thompson Hine. She’s a former federal prosecutor, but she appears to have little or no experience with labor and employment law, or allegations of sexual harassment.

Spinning the story

Carson, who has yet to respond to our questions, tweets:

We are committed to a strong and healthy workplace for our staff and will not tolerate any inappropriate behavior. @siliconvalleycf believes in accountability and transparency and will share the learnings and actions from the independent investigation. https://t.co/siAHetxl02

— Emmett Carson (@emmettcarson) April 18, 2018

Remember those words–transparency and accountability.

A former SVCF employee says to me, by email:

Emmett is positioning himself to throw her under the bus to save his own ass (pardon my language) and it is not right. As a CEO, he either knew or should have known. He should have asked more questions and opened his eyes at least to the turnover rates.

This is mere speculation, of course.

But, by posting a statement and tweeting before responding to us–knowing that we will wait for him to comment–Carson appears to be trying to get out ahead of the story. He’s doing “damage control,” in the argot of Washington politics.

April 18: The SVCF responds to our questions. Sort of. Transparency and accountability, this is not.

The Chronicle publishes our story.

Today, April 19: Recall what Carson told David Callahan a week ago: That “there have been no formal reports of inappropriate conduct involving any employee at SVCF.” This may be technically true–who knows what is meant by a “formal report”?–but it turns out to be misleading.

Carson tweets:

Then Maria Moreno, a former executive assistant to Loijens, tweets:

To which Carson responds:

By my count, Carson thus acknowledges two complaints to HR of inappropriate conduct, one aimed at him. Several years ago, Loijens’ former executive assistant, Rui (Rae) Zhou sued the foundation; it’s not clear whether she, too, complained to HR.

Transparency, this is not.

Two concluding thoughts. Unlike most of this blogpost, let’s label them opinion. First, I wonder whether the very business model of the SVCF, which depends on donor-advised funds, or DAFs, undermines the principles of accountability and transparency. DAFs are built upon a legal fiction: While the law requires that DAFs be controlled by the parent charities like the SVCF, it is the donors, in practice, who decide how the funds will be spent. What’s more, DAFs are anything but transparent. They appeal to wealthy donors precisely because of their tax advantages and secrecy. [See my recent blogpost, Philanthropy’s Dark Money, for more.]

Then there’s this, apparently from a former employee of the SVCF who posted advice to management earlier this month on GlassDoor:

You have this obsession with being the biggest community foundation in the world…but for what? That isn’t inspiring. That isn’t why people get into nonprofit work. Why should the organization be so proud about how much money sits in its accounts and doesn’t actually go to benefit nonprofits? It makes no sense. It’s an incredibly misguided measure of success that mainly serves to stroke your own egos. Can’t you see that? Can’t you see that when you brag about being the biggest and the best in front of employees who are overworked, under-resourced and underappreciated, it leads to resentment not pride.

More to come, presumably, but not from me, at least for a while. I’m heading to Rwanda on a reporting trip in a few days.