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From NPR News, this is ALL THINGS CONSIDERED. I'm Melissa Block.

ROBERT SIEGEL, host:

And I'm Robert Siegel.

It's not all cocktail parties and free tickets anymore. These days, sitting on the board of directors of a theater or a museum is real work and it's getting more difficult all the time. Arts organizations are competing for audiences and struggling to balance the books. The successful ones make their boards partners in that effort.

As NPR's Elizabeth Blair reports, it's a crucial relationship that doesn't come easy.

ELIZABETH BLAIR: Corruption, mismanagement, extravagant spending. These were some of the charges leveled at the Smithsonian Institution's former secretary. He and others on his management team have since resigned. The controversy came back to haunt the Smithsonian's Board of Regents, which was held accountable by Congress for lack of oversight. It's a worst-case scenario, but it shows what can happen when a board is too passive and a manager deliberately keeps it arm's length.

More typically, the problem is arts organizations who need and want their board's help but don't know how to get it.

Nancy Whitehead co-edited a book about theater boards called "The Art of Governance."[POST-BROADCAST CORRECTION: Her name is JAAN Whitehead.]

Ms. JAAN WHITEHEAD (Co-Editor, "The Art of Governance"): You wouldn't believe how many boards you could go to and go around them and say, what's your role? What are you responsibilities? And people can't answer the question. If you go to the staff, they don't know either.

BLAIR: Board members of non-profits are usually significant donors to the organization. They are expected to fundraise, but they're also expected to hire a good leader for the organization, review the finances, and make sure the organization is acting lawfully. They have a lot of power, but they also need to know when to get out of the way.

Bill Poduska chairs the board of the Citi Center for the Performing Arts, the former Wang Center in Boston. For experienced board members like himself, the mantra is nose in, fingers out.

Mr. BILL PODUSKA (Chairman of the Board, Citi Center for the Performing Arts): Nose in, fingers out means be nosey. Keep you nose in there. Find out what's going on. Be informed. But keep your fingers out of the pie. Don't try to run the organization for the people who are trying to run it. It's the whole issue of balance.

BLAIR: In the case of the Smithsonian, there was no balance. That was the conclusion of an independent review presented at the Senate hearing earlier this summer. The testimony of Charles Bowsher, who headed the review panel, was good advice for any arts organization and its board of directors.

Mr. CHARLES BOWSHER (Chairman, Independent Review Committee): Board members are only part time. And how do you know what's going on? Well, you have to have a good dialogue with the key people that are in your management. And that's your CFO, that's your internal audit, that's your external auditor, and certainly your general counsel. And so we think that this should be all - should be opened up and the information should flow very freely.

BLAIR: A potential board member might be turned off listening to that eye-glazing description of the job.

Mr. STEPHEN RICHARD (Executive Director, Arena Stage): These are highly successful, powerful, assertive individuals. And sitting around listening to reports is not going to cut it for them.

BLAIR: Stephen Richard has been executive director of Arena Stage in Washington, D.C. for over 16 years. He works closely with his board of trustees. He says they have a rigorous selection process for board members.

More than anything, Richard believes you have to engage a board, and you do that by asking them to do meaningful work. In Arena's case, it's $125 million campaign for an ambitious building project.

Mr. RICHARD: Obviously, raising $125 million is very important work and very challenging work. But whether it's that or it's a strategic plan for the organization or it's putting on the best benefit in the city, annually giving them meaningful things to do is part of that engagement process.

BLAIR: Board members of non-profit, tax-exempt organizations are volunteers, but they have important fiduciary responsibilities outlined by the IRS. They are required to ensure financial transparency and accountability.

Bill Reeder, dean of the College of Visual and Performing Arts at George Mason University, teaches a class called boards of directors. He says the ability of the board to fulfill its duties is dependent on the head of the organization.

Mr. BILL REEDER (Dean, College of Visual and Performing Arts, George Mason University): If the chief executive doesn't have the discipline necessary to keep the board informed and mobilized and educated, it's extremely difficult for a volunteer to pull that off in a vacuum.

BLAIR: And that chief executive is hired and fired by the board of trustees. Reeder says that's the most important decision they ever make.

Elizabeth Blair, NPR News.

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