"Foundation officers steer assets to selves." "Charity money funding perks." "How to be a philanthropist...or just look like one." In the last few years, non-profits have found themselves under increased scrutiny by the media. Why?
We're talking about major investigations-last fall, The Boston Globe released a five-part, 15-article series on misdeeds in the non-profit sector. The headlines in the preceding paragraph are taken from this series. In 2002, The Washington Post published a series of articles on fraud and misappropriation of funds at the National United Way, probably one of the reasons why donations to NUW fell from $45 million in 2001 to $18 million in 2002. Every local newsroom keeps a shocked ("shocked!") eye peeled for the possibility of someone absconding with a few dollars from a local non-profit hospital, church or other charity or non-profit organization.
So what's wrong with that? No one would argue the non-profit sector should be exempt from scrutiny. Millions of people contribute to them, and other millions depend on non-profits for help. This sector collects and distributes more than $500 billion a year, some $2,500 for every man, woman and child in the U. S. We shouldn't turn a blind eye toward non-profits, should we? The corporate scandals of the late 1990s were extensively covered, weren't they? Governmental malfeasance is always fair game, isn't it? So why should the non-profit field be different?
It shouldn't-but according to much of the press, it is. Today's media often use different-and often tougher-standards when covering misdeeds in the non-profit sector than is done with malfeasance in the corporate or profit-making sector. Want more proof of this double standard? Despite major problems in both the corporate and the non-profit worlds, you can find stories suggesting that non-profits "should be more like businesses." When's the last time you saw a story suggesting that non-profits had something to teach business?
As Michael Hedges of the Houston Chronicle puts it, corporate malfeasance, "once expected to be a political earthquake, now seems little more than a tremor." There has been relatively little indignation over just what occurred during the 1990s-America seems more interested in watching Donald Trump fire wannabes on national television. If the public doesn't care, the theory goes, why should the media? But would the public care if the media had continued to focus on whether corporate America had learned its lesson from the 1990s? We'll never know, because they didn't bother.
Are the mainstream media today doing their job? Here are two examples:
* A new scandal has broken out over practices of the mutual fund industry. Did the media bring this to our attention? No, awareness of the problem was brought to the forefront by New York Attorney General Eliot Spitzer (and to a lesser degree, the Securities and Exchange Commission).
* In 2002, a report by Mother Jones magazine found that dozens of companies had repeatedly been cited for serious workplace and environmental violations. Among the findings, 46 of the biggest contractors had been prosecuted by the Justice Department and ordered to pay cleanup costs after they refused to take responsibility for dumping hazardous waste and other environmental violations. They are still stonewalling. Did you see this story anywhere else in the mainstream media?
It appears strange, but no one expects much from our corporate leaders today-since conventional wisdom is that their role is to lead their business and not the society at large. Over the past few years, polls have found only a smattering of support for big business, per se. According to a 2003 report by The New York Times, public trust in business is at the lowest level in 20 years.
But people expect more from non-profits. In exchange for tax breaks, they are supposed to help the poor, tend to the sick-in short, they're supposed to be the good guys. We contribute to them for reasons that make us feel good. When they disappoint us, the regret and anger can run deep.
Why the disparity?
It seems to me that some of the reasons for this disparity are relatively benign, but others demonstrate just how far the media have drifted from the days of their traditional role to "comfort the afflicted and afflict the comfortable."
On the benign side, human nature, rather than journalistic standards, explains some of the difference. When the town lothario gets caught in the local brothel, it's a ho-hum "dog bites man" story. When the leader of the local "chastity now and forever" movement ends up in a similar situation, it's news. We don't like hypocrisy. (The analogy, in the world of misdeeds by elected officials, is called "character.")
The non-profit world faces criticism the corporate world often does not. The business world need only to change the rules; non-profits are urged to change the very nature of the game. For example, the "scandal" of "excessive" compensation for non-profit executives. How much original reporting has been done on why high pay is endorsed as an effective tool for getting the best business minds to run a corporation while supposedly irrelevant (and somehow distasteful) when it involves non-profits?
Problems in the non-profit world are often accompanied by calls for sweeping changes in the very nature of not-for-profit organizations, while corporate foibles are treated as individual mistakes by companies (e.g., Enron) or their CEOs (e.g., Martha Stewart). The possibility that there is a systemic problem is rejected. When corporate America stumbles, no one questions anything as basic as whether "the business of America is (or should be) business." Analogous to the former U.S.S.R.'s rejection of any criticism of the government while allowing criticism of individual low-ranking bureaucratic transgressors, it is all right to criticize an individual corporate executive (or, as increasingly happens, criticize any whistleblower involved), but not to criticize the concepts and philosophies that permeate American business.
Besides the reasons cited above, I'm afraid there's one other major explanation for the difference in press coverage of profit-seeking corporations and non-profits. The newspaper and television and other mass media industries receive the majority of their income (and profit) from other businesses. Advertising. As a result, among other dubious practices, corporate p.r. staff are given advance notice of controversial stories, allowing them to pull their advertising-or have another chance to convince the media that it really isn't much of a story, after all. Even Journalism 101 classes are well aware of the disintegrating wall between the business and the editorial "sides" of the enterprise.
After all, an increasing proportion of the media today is part of big business. Tons of paper have been used to describe the consolidation of media (and media influence) over the past few years. It's not unfair to wonder if that's going to color news coverage of business: As one former network news staffer put it, "when we're talking about big business, we're talking about us." The media seem to be taking their lead from the movie Broadcast News: It's not up to the media to cover the business side of the media, "and if the network doesn't cover it, it must not be important, so why worry?"
The bottom line is that it hurts the bottom line to take on corporate America, unless it is the rare story just too big to ignore.
Going after the non-profit field, however, offers little risk while continuing to allow the media to tell itself and its critics that "news" is more than another dozen special reports on Janet Jackson's clothing-optional show at the Super Bowl.
And that's the sign of a bully.
Since non-profits haven't the resources to fight back, and rarely contribute to the media bottom line, it may be a win-win situation for the media to look for stories there. And they do-on the one hand, demanding more auditing and oversight, and on the other hand, complaining about the high costs of administration in non-profit organizations.
But, since non-profits can't fight back, the media become a bully.
Sure, what happens in the non-profit field is important, but in size and impact this sector pales besides what happens every day in the board room, on Wall Street and at WalMart. To focus the big investigative guns on the non-profit world while adopting a "been there, done that" attitude about corporate America doesn't serve the public interest in any way.
The above article was published in Media Ethics , Spring 2004 (15:2), pp.6,19-20.