DATELINE, December 18, 2007, Chicago
Several times each month we receive e-mails from nonprofit employees who believes that something is not right in their organization. Inevitably, the e-mails includes some documents, as well as requests that we help them by publishing a post disclosing the wrongdoing. We always...
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refuse, largely because we write commentary and leave the investigative journalism to the pros. When we respond to these would-be whistleblowers, we usually point out that their story on its surface is certainly interesting, but that we are only hearing one side. We note that their allegations could be legitimate, but that the employee could also be someone who didn't receive the raise or promotion that they believed they deserved, meaning that they have an ax to grind.
This past week we received a complaint that seemed to be far more rationale than most of the complaints that we receive. Nevertheless, we refused to intervene. We just don't have the time. Nevertheless, the complaint got us thinking. The person was concerned that grant money from two non-governmental grantmakers was being misused and wasted. The person sending the e-mail was trying to figure out who to contact. The media, his employer, or the state attorney general's office? Our concerned insider was smart enough to worry about liability for slander and liable.
In the shower this morning, we gave the problem some further thought--our shower, being built for one, is always crowded. These days, everyone is talking about internal controls and best practices. That discussion inevitably leads to whistleblowers. It is now widely believed that every nonprofit should have a whistleblower policy. We don't disagree. These policies often focus on employee access to the board, the audit committee, someone in the human resources department, or a third-party hotline.
In light of our most recent whistleblower contact, we think foundations and other grantmakers should consider building whistleblower policies into their grants. Everybody is worried about waste. The assumption seems to be that if the nonprofit has a whistleblower policy, the problem will be fixed once someone at a high enough level of the organization is made aware of it. But it seems to us that the nonprofit grantee often has no interest in having the grantmaker know about the problem and even an incentive to somehow cover it up.
If we were a grantmaker, we would add the following requirements to our standard form contract awarding the grant:
A requirement that the grantee include the grantmaker in the grantee's whistleblower policy as a named-recipient for complaints regarding the grant and its administration, together with contact information.
A requirement that the grantee's employees be made aware of the whistleblower policy on a periodic basis.
A requirement that the grantee not retaliate against employees who make legitimate complaints to the grantor.
This may already be the standard practice, but we don't know for sure and we suspect it is not for many grantors. Of course, government grantmakers have been doing this under the Federal False Claims Act and its state and local analogues.
If you are a grantmaker and do impose a whistleblower requirement on grantees, we would love to see the language. If you do send it to us, please indicate whether we have permission to reprint the language and if so, whether we can do so with or without identifying your organization. Thanks.
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