Pondering ethics in the nonprofit world - Does character count?

Here's a hypothetical scenario about a nonprofit organization. If you think it is loosely based on a real-life story, you are correct.

The chief financial officer of the nonprofit was highly regarded by the CEO, the board of directors, the outside auditors, its investment managers and its donors. He spoke well and handled many complicated issues professionally and capably. He had been employed by the nonprofit for several years and was even mentioned by some board members as a possible candidate to replace the CEO.

One day the CEO asked to speak privately with the trustee who chaired the nonprofit's audit committee. He revealed that he had received an anonymous newspaper clipping in the mail from a northern city, announcing the engagement of the CFO to a woman in that city. The problem, he explained, was that the CFO had brought another woman to social functions sponsored by the nonprofit and had introduced her as his wife. Upon investigation (including a review of the CFO's e-mails) it appeared the CFO had several serious romantic relationships with women in three cities.

The organization had a Code of Ethics, which expressed its commitment to integrity and honesty. Among its provisions was the following: "Employees, volunteers and others shall conduct themselves at all time with the highest ethical standards, knowing that by their actions they exemplify the mission and values of our organization."

The CEO and trustees immediately decided to terminate the CFO. What would your nonprofit organization have done in a similar circumstance?

I faced an analogous situation many years ago when I was general counsel of a large corporation. A mid-level executive had been arrested on a weekend for conduct unrelated to his job. The chairman found out about it and wanted him fired. I argued that the offense was not job-related and therefore he could not be terminated. The individual in question never knew about the highlevel dispute over his status, and subsequently kept his job.

Today, my answer would have been different. Organizations now do not draw any line between behavior on-the-job and off-the-job. An employee's character does not change when he or she leaves the office, and values like "integrity," "honesty"

and "respect"

have meaning 24/7.

Organizations gain trust and credibility when they demonstrate that their values endure, even in the tough situations. It is easy to fire a poor performer who is unpopular because of an obvious infraction. It is harder to fire a good performer who is popular because of behavior that may be invisible to those who know him or her at work. However, that is what is required if organizations are to be truly ethical.

For that reason, organizations now communicate in many ways the importance of character and personal integrity. In the hiring process, employers ask candidates open-ended questions such as, "Tell me about an ethical situation you have faced in the past and how you dealt with it." In the performance appraisal process, employees are rated not only on their job goals and objectives, but on qualitative measurements such as "ethical leadership," "candor," and "willingness to question or challenge existing practices."

We've all heard the expression, "Walk the Talk." In the nonprofit world, where reputation is our most valuable asset, living up to our values is essential.

The Southwest Florida Community Foundation has been supporting the communities of Lee, Charlotte, Collier, Glades and Hendry through endowed funds for nearly 32 years. The Community Foundation has provided more than $39 million in grants and scholarships to the communities it serves. For more information, please call 274-5900, or visit their web site at www. floridacommunity.com.