Independent Report Faults Media, WWP Board For Fiasco
September 6, 2016 Mark Hrywna
No one escapes the wrath of Doug White in his written overview of the Wounded Warrior Project (WWP) fiasco earlier this year. The organization, its board, major media organizations, former employees and so-called whistle-blowers, former executives, charity evaluators, and even the Department of Defense all had some part to play. In the end, he still suggests that the five members who served on the board at the time should quit.
White spent the summer researching “The First Casualty: A Report Addressing the Allegations Made Against The Wounded Warrior Project in January 2016,” and released the 79-page report today. A former director of Columbia University’s master of science in fundraising management program, he has written four books related to philanthropy and fundraising and has advised hundreds of charities of all types and sizes since 1979.
“It seems likely that the self-inflicted damage is more than the current board can handle. Its members might well consider a transition strategy to effectively replace itself. The honorable decision at this point would be for the board … to resign. This was not a senior staff problem. This was, and quite possibly still is, a board problem,” White wrote.
He described the reports by CBS News and The New York Times as “inadequate and unnecessarily damaging journalism.” Watchdog group Charity Navigator calls itself “your guide to intelligent giving,” but White counters that “it is nothing of the sort.”
White suggested the media organizations publish an apology story since many allegations in their reports were either wrong or misleading. Both also should have vetted their primary source of allegations, former WWP employee Erick Millette, for bias and accuracy and included the views of others. CBS News responded with a statement to The NonProfit Times only to say in part, that they “stand by their stories,” and noting interviews with more than 100 current and former WWP employees.
The board acted inadequately in several respects, according to White. Immediately after the allegations, the board did not permit either CEO Steven Nardizzi or COO Al Giordano to respond but it also did not respond. “This left the impression that no one was in charge and that there may have been merit to the allegations,” he wrote. “The board made the situation worse, after a review was conducted in the aftermath of the news accounts, by simultaneously announcing that “certain allegations raised in media reports were inaccurate’ and that while, giving no concrete reason, Nardizzi and Giordano were fired.”
The board’s missteps, White argues, occurred after the allegations came out. Donations were not substantially affected in February, after the media stories, but did drop after Nardizzi and Giordano were fired in March. “Something was in the air and the board clearly felt the need to do something, thus, the headline-maker, the firing of its top two executives,” the report noted.
“While the narrative is being built that WWP’s new staff leadership will correct many wrongs, it must be pointed out that any mass layoffs and any large drop-off in contributions are not the result of what happened prior to January 2016. It’s what happened after. And what happened after was wholly orchestrated by the board of directors,” he wrote.
The problem wasn’t the senior management or the board but the “stature of two venerable news organizations that developed reports that were essentially incorrect and based on biased and incomplete perspectives of former employees, many of whom had been fired, who took it upon themselves to blow a whistle that, in the end, was far more the screech of uninformed whining than a signal of any merit.”
The two fired executives don’t escape scrutiny in the report, either. “Nardizzi’s confidence in his leadership abilities may have blinded him to the optics of the way he ran the organization,” White said.
WWP’s board declined to participate in White’s research. “That no board member responded, not even the chair, is telling. Alas, other than by piecing together fragments of the story from third parties, the full task for which is well beyond the scope of this report, we may never know the answers to these questions, and therefore the entire truth of the crisis,” he wrote.
Tom Johnson of Abernathy MacGregor, a communications firm the board hired after initial media reports, is quoted in the report saying that board members think some of the 14 questions raised by White should be directed to CBS, and not to them. In a statement to The NonProfit Times, the board reiterated that it engaged an independent firm to conduct a review of the organization, which concluded that it wound benefit from new leadership, in addition to changes in some policies and procedures that did not keep pace with its growth. “The board remains confident in its actions at the time and since, including the appointment of new CEO Mike Linnington, and will continue to work closely with the senior staff to provide critical services to our nation’s wounded warriors.”
White singled out board member Richard Jones, a senior executive at CBS Corporation, for a “serious conflict of interest as the crisis developed.” Jones is chairman of the board’s audit committee and also serves on the board of two other veterans’ charities that “very much dislike” WWP. He suggests that Jones should have recused himself from discussions the board conducted concerning the issue. At the same time, White said it’s odd that the chairman of the audit committee did not “come to the rescue” when the organization was criticized for auditing procedures.
White also raises contradictions by former employees, particularly a closed Facebook group that initially seemed to provide support for former employees but became a forum to criticize WWP leadership.
“That the Facebook group existed, and perhaps still does, is not an issue in itself. But, it is plausible to think that the 40 or so people with whom CBS News spoke were essentially in an echo chamber,” White wrote.
Some of the employees interviewed in the initial news were “fired for poor performance or ethical breaches,” including theft and abuse of funds. Three were employed in “positions that required sensitivity and integrity with money.” After they were fired, they joined the ex-employee Facebook group, one of whose purposes was to “take down” WWP. Why Millette made contradictory statements is unknown but it appears his purpose was to harm the organization, White said, citing a Jan. 15, 2016 Facebook post by Millette that read: “I cannot wait for the day that WWP fails.”
White reached out to Millette in July to include him in his report but during a Facebook conversation but White said Millette told him “I’m not discussing WWP.” Two weeks later, Millette was quoted by the CBS affiliate in Jacksonville, Fla., about his thoughts on new CEO Michael Linnington, who last week announced a reorganization.
It’s also been a common refrain in some circles of the nonprofit sector that Wounded Warrior is too aggressive in both fundraising and protecting its brand. Some of that rivalry extends to other veterans’ charities and even federal officials, according to the report.
White noted that “not one person provided anything other than the sentiment” that Admiral Michael Mullen, former chairman of the Joint Chiefs of Staff, dislikes Wounded Warrior Project. Prevailing opinion, he said, was that the charity’s advertisements depicting catastrophically wounded veterans resulted in fewer applications to join the military.
“There can be no doubt that, while some might point to flaws or only-yet-to-be-realized dreams, Wounded Warrior Project cannot be accused of a lack of effort, success, or transparency connected to its work to create an impact on its community,” White wrote. “Media accounts, evaluators, and critics — such as Erick Millette, or Charity Navigator — do not have authority to complain or criticize without first understanding the complexities of running a modern charity or, at WWP, the programs that help tens of thousands of wounded veterans, their families, and their caregivers.”
A copy of the 79-page report can be found here.
Editor’s note: This story was updated at 4:05 p.m. to reflect a statement from the organization’s board and again on Sept. 7 to reflect a statement from CBS News.