Discussion of best practice nonprofit governance using The Second Mile, founded by Jerry Sandusky, as an example of several pitfalls in leadership, management, and governance

1. Governance Lessons of
The Second Mile

2. The Second Mile
• Founded in 1977 in State College, PA
• Mission to serve underprivileged youth
and their families
• 2009 budget – about $3 million
• Served up to 100,000 children & families
annually statewide
• Operations suspended in late 2011
For more: http://en.wikipedia.org/wiki/The_Second_Mile

3. Praise for The Second Mile
• U.S. President George H. W. Bush praised
the group as a "shining example" of charity
work in a 1990 letter, one of that
president's much-promoted "Thousand
points of light―

4. Praise for The Second Mile
• Citing Sandusky's work with The Second
Mile charity to provide care for foster
children, then U.S. Senator Rick Santorum
honored Sandusky with a Angels in
Adoption award in 2002.

5. Praise for The Second Mile
• Ex-Eagles head coach Dick Vermeil, current
Eagles head coach Andy Reid, R.R.M.
Carpenter, III, former Eagles owner, actor Mark
Wahlberg, golfer Arnold Palmer, and football
players Ham and Franco Harris, among others,
served on the Honorary Board of Second Mile.
NOTE: it’s unclear whether all honorary
board members consented to have their
names used by The Second Mile

7. History of The Second Mile

9. And then, suddenly…

11. Expert questions makeup of
Penn State case charity

13. Public Records - Sources
• IRS Form 990 Filings
• PA State Charitable Organization
Registration Statement
• Second Mile web site
• Other public web sites

14. Issues
• Founder’s Syndrome
• Founder as Titled Corporate Officer
• Board Conflicts of Interest—General
• Conflict of Interest—CEO and Spouse Both Employed by Nonprofit
• CEO with Multiple Professional Relationships
• Board Members Sharing Employment Relationship
• Lack of Board Term Limits
• Complex Governance Structure
• Board(s) Too Large
• Donors and Celebrities as "Leaders"
• Access to Legal Counsel
Source: The Second Mile - Lessons in Nonprofit Governance, Sumption & Wyland
http://www.sumptionandwyland.com/index.php?option=com_content&task=view&id=40&Itemid=57&rid=76

15. To quote an old, old joke…
Patient: ―Doctor, it hurts when I do this!‖
Doctor: ―Well, stop doing that!‖

16. Leadership Lessons
• Founder
• Board of Directors
• CEO and leadership staff
• Donors & supporters
• Legal & organizational

17. Founder’s Syndrome
Strengths Weaknesses
• Visionary • Individualistic
• Energetic • Single-minded
• Magnetic • Rigid
• Focused • Loved
• Determined • Feared
• Professional development?

18. Board of Directors
• Members recruited and acting for
organization’s mission
• Sensitive to conflicts of interest
• Eager to clarify roles – both own and others’
• Governance committee (governance
function)
• Proper policies & procedures in place and
working

19. CEO and Leadership Staff
• Attuned to conflicts of interest
• Policies and procedures in place and
working
– Moonlighting/consultation work
– Volunteer management

20. Donors & Supporters
• Define roles & relationships
• Always secure permission – preferably
written permission – to cite celebrities
• Limit appearance of governance
responsibility for non-board members

21. Legal & Governance
• By-laws
– Simple to understand
– Limited to essentials
• Governance committee
• Well-defined governance structure
• Easy-to-find, easy-to-read documents
– By-laws
– Annual reports
– Form 990

22. The best time to get ready for
adversity

23. Thank You!
818 S. Hawthorne Avenue
Sioux Falls, South Dakota 57104-4537
(605) 336-0244 or (888) 4-SUMPTION
www.sumptionandwyland.com
http://www.linkedin.com/in/michaelwyland