Generation AK and the Nonprofit Board

by Sarah K. Williams

A great deal has been written lately about the marketing opportunities created by the aging population in the US, because of the demands this gourp will continue to make on healthcare, housing, and an enormous range of products and services. This is only to be expected when, with each report from the Federal Reserve, we find that the nation’s wealth is likely to be concentrated in the accounts of the nation’s oldest citizens for many years to come.

 

What has failed to get sufficient attention, I believe, is the challenge that this population poses to Nonprofit Boards, and specifically to matters of Nonprofit Governance. The bylaws that typically govern the practice of Nonprofit Boards, for example, do not foresee the difficulties or the challenges that elderly members of such boards make a reality, especially when such members come to constitute a majority.

 

The problem of the Baby Boomers aging gracefully, with the help of technology, but behaving less so, also thanks to technology, has given rise to a management literature concerned with “Generation AK,” or the “YAK” problem. Unlike aging problems in academia, where the unwillingness of elderly members of American college and university faculties to retire, under any circumstances, has led to widespread study of the effects of different degrees of senility on pedagogy and scholarship, the possible problems caused by senility and general infirmity among members of Nonprofit Boards have not been openly discussed.

 

The case of the Lemsko Foundation is an important recent example of such problems. The Lemsko Foundation was created in the early 1970s as an arts and animal advocacy organization, and it became a nonprofit corporation in Minnesota in 1976. The Lemsko had granted or re-granted more than $7 million since its incorporation, while conducting its own programming primarily in the libraries, schools and animal shelters of Flinkster County. In 2008, the Lemsko was asked to suspend all activity, by the state of Minnesota as well as the IRS, for having failed to pass budgets (and to file related financial documents) for a fourth consecutive year.

 

The problem had to do with the Finance Committee of the Foundation’s Board which, according to the Foundation’s bylaws, was required to recommend a budget to the full Board before it could be approved. The Chair of the Finance Committee was himself the oldest member of the Board, and at 83 he suffered from Krepmann’s Lassitude Syndrome (KLS). This mild form of dementia, which he openly acknowledged but which did not disqualify him from full participation in community life, he claimed, and did nothing to restrict his ability to attend meetings (he was proud to say that he had been driving legally for more than 60 years), apparently impaired his perception of the real costs associated with operating an organization like the Lemsko in the 21st century. In particular, he refused to accept the budgeted lines for telecommunications charges, and believed that the Executive Director was enriching himself with the funds allocated to “Web Development and Internet Services,” which each year he insisted could not be explained to his satisfaction.

 

Unfortunately, the organization’s bylaws allowed the Chair of Finance to appoint members to the Committee without full-Board approval, and he apparently populated his committee with like-minded members, most of whom were retirees and all of whom were over 65. Although the great majority of members of the full Board acknowledged that the Chair of Finance was “occasionally confused”, they also knew that the largest contributions to the organization from members of the Board came from the members of the Finance Committee, and as the budget of the organization was relatively straightforward and simple – the Foundation employed only three people – the Board decided to let the matter slide. Two attempts were made by Board members not on the Finance Committee to remove the Chair of Finance from the Board, for cause (something allowed by the bylaws), but the majority of members (90% of whom were over 60) voted to deny the motion each time.

 

The suspension of the Foundation’s activities would likely have had no long-term consequences were it not for a peculiarity in the organization’s charter that required the Foundation’s endowment to revert to the Lemsko family in the event the organization offices were closed for eight consecutive days. The Lemsko Foundation was officially dissolved on November 12, 2008.

 

The lessons here for nonprofit governance are obvious: like the technological concerns associated with the “Y2K” problem, nonprofit organizations must overhaul their principles and mechanisms of governance in order to protect themselves from the volatilities of an aging membership. The likelihood that nonprofits will be able to depend on younger members for significant financial resources in the coming decade(s) is fast-diminishing, and so imposing age limitations on membership will be impractical even when it is legal.

 

In order to conduct a complete, effective revision of organizational governance strategy and practice, each nonprofit will want to engage a qualified consultant and incorporate age-preparedness into its next strategic planning cycle. In the meantime, however, we offer “5 Concerns About Generation AK”™ that can help with short-term fixes and protections:

 

1. The Memory Concern: As both the capacity and veridicality of Board members’ memories becomes increasingly unreliable, the utility of narratives about the past, present, or future of the organization will decrease sharply. As the “collective mind” of the board deteriorates non-linearly, organizations must document their actions and activities with increasing precision, using all manner of computing technologies (text, audio, video, etc.). In cases where boards are in sympathy with their own condition, annual retreats to locations with significant MRI and PET-scan facilities may be worthwhile.

 

2. The Incontinence Concern: An optimistic scenario envisions Nonprofit Board performance becoming more efficient as the ability of members to sit through meetings of a given length diminishes. However this may be, organizations must structure board meetings, committee meetings, board candidate interviews, and even long substantive conversations in such a way as to maximize the attention of older board members whose bladders have become what Chiat and Newcomb (2006) call “socially dominant organs.” Today, the business of the great majority of Nonprofit Boards can be easily disrupted through the combination of this and the memory concern alone.

 

3. The Dementia-Related Anger Concern: Patience, goodwill, and sympathy have always been the hallmarks of effective Board practice, but as Tammy Wilkins points out in her recent monograph, Governance: The Lesser Evil, “organizations are shocked at how quickly their major concerns become: patients, good wills, and pathology.” Governance committees should be thinking about how to rewrite bylaws so as to be of practical use in dealing with impasses, conflicts, and flights of fancy, and in proscribing the use of inappropriate techniques of argumentation, in an aging Board membership.

 

4. The Cultural Inappropriateness Concern: With a growing number of Boards concerned with diversity issues, good governance will require frank discussions about the sorts of terms and remarks that are no longer considered supportive of a progressive, socially-aware enterprise. Expressions of social solidarity by elderly members, however sincere, can be easily misinterpreted by younger members, or prospective members, as racist, sexist, or culturally backwards. A diversity committee can do much to identify out-dated terminology (e.g. gal, Negro, Hebrew, Chinaman), and remind Board members of the current month and year.

 

5. The Sleep Concern: The demoralizing force of a Board member falling asleep during a committee or full-Board meeting is amplified exponentially in an aging Board population, and nappers in this group tend to cluster. Although Board Chairs and Executive Directors can sometimes use bells and loud entertainments to prevent sleep from overwhelming a quorum, a more positive and less time-consuming strategy will be to use content “chunking” to structure Board business and especially matters requiring a vote. Boards should also make use of computer-based content management systems that allow members to access documents and discussions, and even make decisions, at times of maximum wakefulness (or at least when no one but their spouses/families/nurses will observe their dozing).

 

The challenges to governance posed by an aging Nonprofit Board population are enormous, but that the nation’s wealth and expertise (but especially the wealth) is concentrated in its oldest citizens is as indisputable as it is irresistible. Principles of good governance can be implemented effectively to preserve fiduciary responsibility and reasonable degrees of accountability, even when significant numbers of individual board members are in advanced stages of deterioration. A new kind of Nonprofit Board leadership is thus possible, I believe, in which the whole is more competent than the sum of its parts.

 

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