In light of recent discussions, I thought that this might be a useful item to post. It was first published in "Reflections," December 17, 2000.
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Financial Accountability, by Andy Hanlen
In order to have a healthy non-profit religious organization based on trust; the members must be able to see what's being done with their money. Many of us have seen the reports from Nichiren Shoshu members and the Japanese tabloid press, as well as main stream American publications, putting forth various allegations of financial malfeasance and wrongdoing, and all we have to counter these slurs are assurances from the leadership that they are not true. Without full accountability we can not know for ourselves, nor can we speak intelligently to our detractors. We are left in the position of a child being confronted by another child and only being able to say: "...because my Dad said so, THAT'S why!"
It is also important in our propagation efforts, as we mature as an organization seeking mainstream status in American religious society. It is very difficult to talk to savvy adults who ask how the organization is financed, what exactly is its annual budget, how much are staff members paid, what are its financial holdings, etc. Justified or not, there is a natural suspicion of a group which will not disclose such information. The obvious question is: "What could they have to hide?" Again, we as members have no way to answer these questions.
Without addressing what's the norm in Japan, it is certainly fair to say that non-profit religious organizations in the United States, at least all of the mainstream ones, offer a full accounting to their constituencies. While not required by law in this country, it is rare for a church, synagogue or temple to decline to make this information available. As we take the next step toward becoming a mainstream religion in America, we too must take this step. If we are carrying out our activities as responsible Buddhists, we can surely have no reason not to do so. Following are a few points taken loosely from "Seven Standards of Responsible Stewardship," which is the guideline statement from the Evangelical Council for Financial Accountability, a Christian group. (http://www.ecfa.org/bill.asp)
The organization should appoint (or better, allow to be elected) a functioning audit review committee, a majority of whom would be other than SGI-USA employees/staff and/or those related by blood or marriage, for the purpose of reviewing the annual audit and reporting its findings to the CEC and to the membership.
The organization should obtain an annual audit performed by an independent certified public accounting firm in accordance with generally accepted auditing standards (GAAS) with financial statements prepared in accordance with generally accepted accounting principles (GAAP). The organization should provide a copy of its current audited financial statements to any member upon written request.
There's more, but that would be a great beginning. As responsible members of our community we have the duty to expect financial accountability on the part of the organization we are asked to support.
Andy Hanlen
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Donor's Bill of Rights - From the ECFA web site (http://www.ecfa.org/bill.asp)
Make sure your charity standards and guidelines assure you of a "bill of rights" as a donor. You have the right to:
1. Know how the funds of an organization are being spent.
2. Know what the programs you support are accomplishing.
3. Know that the organization is in compliance with federal, state, and municipal laws.
4. Restrict or designate your gifts to a particular project.
5. A response to your inquiries about finances and programs.
6. Visit offices and program sites of an organization to talk personally with the staff.
7. Not be high-pressured into giving to any organization.
8. Know that the organization is well-managed.
9. Know that there is a responsible governing board and who those board members are.
10. Know that all appeals for funds are truthful and accurate.
Comments
I'm not starting on drama, but here's a comment.
I think the financial accountability issue has become more on an organization's credibility level than the Buddhism they/we/you/I practice.
(Sound familiar? Read On)
After really thinking and analyzing this issue from the various perspectives of many people, both from SGI members both offline and online, I realize that the issue on knowing where the money goes is irrelevant for me.
I mean cmon, it really doesn't have anything to do with Buddhism. Seriously now. Perhaps it becomes a very touchy issue for those who are so concerned with disclosure morals and are sticklers for details as far as wanting to know where theyre money goes etc. La dee Da dee Da.
Now, I'm sure this is a common defense you've heard before and again many times.
But I don't give money to SGI because I want to know their finances and records because its my "Duty".
Hell no! I'm grateful for the services they give and the ongoing effort for them to propagate Nichiren Buddhism/Soka Buddhism/Ikeda Buddhism etc. That's why I give. I give and have my own expectations in return.. and these expectations are more community centers, propagation and more members.
Now I've no interest in the finances because its not practical to me. Like I said, so long that I see more community centers, more newcoming members and more exposure to the American Public. I am content and am willing to give more money. Damn right I am.
Now, some say its wrong because i'm supporting wrong buddhism.. ikeda idolization... Puh-leeze.
Can you say individualistic perceptions?
I do not give a fuck what that man does because i have my own life to deal with. Really!
Now, it may seem very uncaring and ignorant to at least know where my money is, but frankly. I don't care. The strategies which SGI uses in order to provide or gain money are not important to me. Organizations do what they can to survive, and to some it is immoral and unjust.
And I totally understand where you're coming from when you say that we have the duty/right to know where our money goes as far as the organization that we are asked to support, because I supported another organization before SGI and I felt this way for a long time. Perhaps you're very concerned with the money you donate to the SGI and wants to know where it goes, etc. Perhaps you feel that its such a big issue of responsibility and you MUST know. and I respect that, really. But to me, it doesn't fucking matter.
Not a negative criticism or anything, but sometimes I think that many of you online folks (both pro and con SGI alike) have way too much time on your hands. but I'm sure you'd like to prove me wrong.
And I remind myself that you're not in SGI anymore. So where is the relevance there? So why do you speak in generic terms and say "We". Are you even in it? Let me know.
Now, does thinking such thiings really matter in ways that is practical to daily living and conventional problems? It doesn't pay my bills or get me through school. Buddhism gets me through school and better relationship for others. Now I can't speak for others, but I'll say that finances don't matter to me.
But that's just what I think. Whew.
Disclaimer: From 1986-2001, I was an SGI district leader and financial contributor. I have not been active in the organization since then.
I think there's a very simple, if not excusable, explanation for the SGI's failure to disclose its finances: the org in the US is not self-sufficient and probably couldn't be even at the current level of staffing and community center development, presumably the two areas that absorb most of the operating income.
I suspect that US leaders have very little to say about how the organization's "serious" money is spent. That is, those expenditures beyond keeping the lights on and paying the salaries of a hand-full of full-time employees. Things like new culture centers, large national or regional general meetings, contributions to like-minded non-profits (are there any such contributions?).
I don't think this imbalance between what the SGI-USA brings in and what it spends would be a problem for most members: I'm sure they would feel grateful to the Japanese members for their financial support just as they respect and emulate their example in faith and discipleship. However, the implication that the organization here is not responsible or accountable for determining its own financial priorities is unavoidable and undesirable.
Let's say the SGI revealed that it takes $x-million to support the status quo and that the difference between income and expenses is a shortfall of $y-million dollars, presumably made up by the SGI Int'l. Well, the members here might ask a few logical questions:
1) Why are we spending more than we are taking in?
2) If the current budget is a good one, why not ask the members if they would like to supply the shortfall themselves by contributing more or by taking the SGI-Int'l subsidies as loans to be paid back? I would suspect that currently large buildings such as the hq in Santa Monica or the NYC culture center are gifts to the SGI-USA in the sense that American members have free use of them but they are owned as part of a real estate portfolio controlled by SGI Int'l and heaven knows how many interlocking entities.
This puts us in the position of being put on welfare without our explicit consent. Not Buddhistic on the face of it.
3)How much local autonomy should there be over how money is spent? If folks in Minneapolis feel their highest priority is a new culture center, why shouldn't they be allowed to designate that 10% of their zaimu over time be dedicated to this investment? Or to conduct an officially sanctioned special campaign to raise money for it?
Even if American leaders were willing to admit the SGI-USA's financial dependence on Japan and wished to be more responsive to local priorities, merely opening this door would revolutionize both the American and Japanese orgs. To avoid accusations of authoritarianism (which perhaps they don't really care about) Japanese leaders would have to adopt a hands-off approach and in effect give the US a blank check. And American leaders would have to develop mechanisms to poll and communicate evolving consensuses on a number of different geographical and perhaps demographic levels. But how many times have we heard, "the SGI is not a democracy," and "consensus does not mean majority rule."
So in my opinion, financial disclosure is not really the issue as much as financial responsibility. If we in America are not responsible for the cost of our own organization, even if it means something much more modest than our more "successful" Japanese friends would prefer, than we don't own the SGI-USA, we're just renting it. And in the famous axiom frequently used in relation to nation-building, "In the history of the world, no one has ever washed a rented car."
My solution. Tell the members that SGI Int'l has agreed to make up a projected budget shortfall for no more than the next five years, subject to yearly review and progress reports. Even better, give the US the five year subsidy in a lump sum to be spent when and how the US org sees fit.
Then embark on a campaign to engage the members in a dialogue that seeks to outline a multi-year campaign to achieve self-sufficiency in the first phase while looking forward to more creative and mutually agreed upon development spending for the future. It might just be that the members of one region would like to help underwrite a hospice based on Buddhist principles of compassion, while another might wish to underwrite the costs of a particularly eloquent SGI speaker to travel around speaking to various community and religious groups.
But if, on the basis of what Americans are contributing now, the second floor of the kaikan would be dark but for Japanese subsidies, let the members decide if they can live with a first floor they pay for themselves or if they are willing to live with the consequences of being a Japanese religious colony.
I think that Ron Ross' comments above are insightful and valuable, and that concerned SGI-USA members (and leaders) would be well served to take them seriously, at least as conversation starters. Thanks, Mr. Ross.
"Raheim" asked me: "And I remind myself that you're not in SGI anymore. So where is the relevance there? So why do you speak in generic terms and say "We". Are you even in it? Let me know."
If you'll notice, I stated at the beginning of that article that I wrote it when I was still a member of the SGI-USA, hence the "we." The "relevance here" is that many of my friends who remain in that organization continue to explore this topic, and I felt that it might be useful to reissue that piece.
Thanks for asking.
Andy
I went to the ecfa site and was very impressed. Thanks, Andy. I hope the Gakkai reaches a point where we can learn from other organizations. Happy holidays, wahzoh