Question

In: Economics

Find an article about a nonprofit scandal or controversy, orinterview a nonprofit leader about an...

Find an article about a nonprofit scandal or controversy, or interview a nonprofit leader about an ethical issue the leader faced. How did the ethical standards and values of each of the levels discussed in this chapter — personal, professional, organizational, and societal — come into play in the situation?

To receive full credit, the exercise assignment must be 1-2 pages, provide a review of all areas of the assignment, follow APA guidelines, and include at least one reference.

Solutions

Expert Solution

There are six areas in particular where ethical issues arise in the nonprofit sector: compensation; conflicts of interest; publications and solicitation; financial integrity; investment policies; and accountability and strategic management.

Greg Mortenson, founder of the Central Asia Institute (CAI) and author of New York Times best selling books Three Cups of Tea and Stones into Schools, was the darling of philanthropic and literary communities until CharityWatch began investigating his charity in 2009. CharityWatch uncovered a serious lack of segregation between CAI's finances and Greg Mortenson's personal business interests. 2009 financials showed that the charity funded Mortenson's book promotion and speaking events, yet it received no revenue from book sales or advertising and little to none of the $25,000 to $30,000 per-event speaking fees Mortenson charged at speaking engagements.

After seeing CharityWatch's articles on the charity, 60 Minutes contacted us for insight into CAI's finances. CharityWatch president, Daniel Borochoff, was later interviewed by 60 Minutes correspondent Steve Kroft for a story that revealed the problems at CAI went well beyond financial mismanagement. 60 Minutes surveyed about thirty schools that CAI claimed to have built, finding that roughly half of them were empty, built by someone else, or not receiving funding from CAI. 60 Minutes also interviewed author and former donor to CAI, Jon Krakauer, who argued that many claims made in Mortenson's inaugural book were fictitious. Mortenson later admitted that events in his books were compressed, but insisted any literary license taken did not amount to lying.

CAI's board confirmed to 60 Minutes that CAI spent only 41% of its expenses on building or supporting schools in 2009, but argued that the funds it spent on speaking events at which Mortenson promoted his books should also be counted as a charitable program. That year CAI spent $1.7 million on book-related costs that included "Advertising, events, film and professional fees, publications (books & freight), and some travel," according to its audit. One attorney who examined CAI's financial activities advised Mortenson and the charity's board that "CAI's outlays for book advertising and travel expenses for Mortenson's speaking engagements appear to be in violation" of IRS rules, and that Mortenson could owe $7.2 million or more for "excessive benefits received during 2007, 2008, and 2009."

The charity's 2010 tax form revealed it continued to spend more on "awareness," including Mortenson's books, than funding schools that year. CharityWatch called for Mortenson's resignation earlier this year, arguing that CAI will be unable to recover from its tarnished reputation with him at the helm. The charity is also under inquiry by the Montana attorney general.


Related Solutions

As a current and future leader in a nonprofit organization, and based on A. Carroll’s article,...
As a current and future leader in a nonprofit organization, and based on A. Carroll’s article, choose and explain two corporate social responsibility expectations you feel nonprofits will face and be expected to meet, e.g., protecting the environment.
Enron Scandal Discussion Read the article and watch the video Enron Scandal: The Fall of a...
Enron Scandal Discussion Read the article and watch the video Enron Scandal: The Fall of a Wall Street Darling (Links to an external site.)Links to an external site.. Summarize your understanding of the information you read and watched. Include in your response what Enron could have done differently to prevent the collapse of the organization.
 read the article “Ethics In Accounting: The Consequences Of The Enron Scandal.” This article is part...
 read the article “Ethics In Accounting: The Consequences Of The Enron Scandal.” This article is part of the readings for the week and can be found through the DeVry online library. Let’s point fingers for a minute. Who is to blame for Enron? The executives? The Board of Directors? The auditors? Tell us what you think
find an article that talks about auditing inventory. Based on the article and the readings in...
find an article that talks about auditing inventory. Based on the article and the readings in your text, discuss why the auditing of this financial statement area is so complex. What are the difficulties faced by auditors in the audit of inventory?
Locate an article on an accounting scandal from the past 20 years. Summarize the article for...
Locate an article on an accounting scandal from the past 20 years. Summarize the article for the class and either add the article to your post or include a link to the article. What did you find most interesting or surprising about the scandal?
Article from the New York Times issue about PETROBRAS OIL SCANDAL that has engulfed the Brazilian...
Article from the New York Times issue about PETROBRAS OIL SCANDAL that has engulfed the Brazilian economy and it's citizens the past few years. Petrobras Oil Scandal Leaves Brazilians Lamenting a Lost Dream (Links to an external site.) 1. Write (in your own words) a page critique and thoughts about this sad event from the perspective of "Ethics" in the global business market place.
Find an article about Inflation in the United States. Post an outline of your article and...
Find an article about Inflation in the United States. Post an outline of your article and make sure to include the title, date, and source of your article.  Make sure it is a current article.  At the end of your outline, answer the following questions.  1.  What is the current rate of inflation in the United States?  2. Do you think inflation is a good thing or a bad thing? Think about employees wages and the prices of products when you answer this question.  Explain your...
Find an article about Labor and Profit margins and write a summary about it. ( the...
Find an article about Labor and Profit margins and write a summary about it. ( the article has to be no more than 6 months old)
Questions about Enron Scandal I cant seem to find answers for: 1. What was the name...
Questions about Enron Scandal I cant seem to find answers for: 1. What was the name of the questionable accounting practice promoted by Skilling and how did it work? How did Andy Fastow hide losses through accounting practices? 2. What happened in California and how could it have been prevented? 3. What was the role of the Wall Street financial analysts in the Enron fraud and what question did Bethany McLean ask of Enron that the financial analysts did not...
Critique and Analysis of Supply and Demand Article Find a current event article about supply and...
Critique and Analysis of Supply and Demand Article Find a current event article about supply and demand (less than one year old). Preferably the article will be from the UCW database of newspapers and magazines or other reliable source. It need not be a complicated article nor does it necessarily have to mention the words supply and demand. However, it should be interesting to you. The purpose of this exercise is for you to demonstrate that you understand the law...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT