Back in August, I came across the most extreme example of failing to plan for an executive transition that I have seen to date. When the executive director of MarinSpace decided to step down, the board chose to dissolve the organization rather than to look for a replacement.
The board’s vote to dissolve occurred when longtime CEO Shelley Hamilton announced she no longer wished to play that role, opting instead to take another, part-time role.
“Her skill set is so specific and unique that when she decided to move to part-time, the board decided it would be [too] difficult to move someone into that (executive director) role with that same skill set,” said interim ED Peter Lee. “Instead of trying to go through that process, we thought it would be better to dissolve and spread the wealth in Marin County.”
And the organization has no lack of assets to distribute:
After it dissolves, it will have between $2 and $3 million in assets, including a building worth $2.5 million, and these will need to be distributed. The 14,500-square-foot building currently houses other nonprofits at 20 percent below market rate.
[…]
Lee laid out three possibilities for distribution of the assets: one organization could acquire the assets and staff and run the group relatively as-is; assets could be liquidated and distributed among a number of nonprofits; or a nonprofit could acquire MarinSpace’s building and staff, but the cash assets of approximately $300,000 could be distributed to other groups.
The thing that really gets me is the disconnect between their mission and practice. The organization’s mission is:
We believe positive social change happens best through collective effort. Our mission is to strengthen networks of community organizations by providing collaboration services and shared workspace.
and they boast
“…our CEO provides key leadership services to the Nonprofit Centers Network, both as a founding Board Member and as a senior project consultant.
They list Sustainability and Professionalism among their guiding principles.
Yet they have a situation whereby they have created a structure that they have decided can’t exist in the absence of a single person. How does that reflect best practices for leading non-profits that they were theoretically instilling in client organizations? How have they worked toward their own sustainability?
What sort of effect might this decision have on the non-profits housed in their facility and those served by those non-profits? How does this decision and uncertain outcomes reflect their mission of collective effort?
Fortunately, they are taking a responsible course by intending to create and oversee a process of distributing their assets as part of the dissolution. As I have written before, sometimes non-profit boards will walk away from an organization and declare they have washed their hands of their involvement. In doing so, they can actually be held personally liable for anything that occurs in relation to the organization having lost the protection of director and officers liability insurance.