First day coverage of WWP firing its CEO and COO

Major news yesterday was the CEO and COO of Wounded Warrior Project getting fired by the board of directors. Here are a few articles on the story. Also, my rant on the long-running pattern of media articles that focus on trivialities.

3/10 – CBS News – Wounded Warrior Project execs fired – CBS is reporting that on 3/10 WWP fired Steven Nardizzi, CEO, and Al Diordano, COO. CBS reports preliminary results from a financial audit have been received and reviewed by the board.

3/10 – Chronicle of Philanthropy – Wounded Warrior Project Fires Top Officials After Query Into Spending Practices – Article points to CBS coverage above.  The board initiated a financial and policy audit.

In the hour since CBS broke the story, I saw several dozen articles hit the ‘net that report the story with merely a rewrite of the CBS coverage.

3/10 – Wounded Warrior Project – Board of Directors of Wounded Warrior Project Addresses Independent Review – Very tactful press release says the CEO and COO are no longer with the organization.

The independent review refuted the headline accusations against the organization and tactfully found room for improvement.

The independent review found:

  • Allocations of costs on the 990 and audited financial statements are in compliance with the accounting rules, specifically what is casually referred to as SOP 98-2. My characterization of their comment is that watchdog organizations that make up their own accounting rules got different results. Change the accounting and you change the results.
  • Of the $26M spent on conferences, 94% was for program services provided to wounded warriors and their families.
  • The 2014 conference cost $940K, not $3M. Such events will be “curtailed” in the future.
  • The charity has devoted substantial effort reaching out to wounded warriors, in contrast to the self-defined claim that “we don’t call warriors, warriors call us.”
  • One percent of air travel has been in business class or first class. Total travel on the FY 14 990 is $7.5M. Assuming that was only for air travel (not a valid assumption), that means that about $75K may have been business or first class.

Room for improvement in catching up policies to the organization’s growth include:

WWP has already begun to strengthen its employee travel policies to more explicitly limit domestic air travel to economy class absent an exception for health or disability reasons. In addition, the Board has committed to other measures, including strengthening policies related to employee and director expenses, enhancing employee training on existing and new policies and procedures, and continuing to have its financial statements independently audited and available on the organization’s Website.

3/11 – Today I did a Google News search for coverage of WWP in the last day. There are over 300 articles.

I read a few of them and browsed the title and first sentence of the first hundred articles. They are essentially a rewrite of the firing and the board’s public statement.

I didn’t find new information that actually expands the coverage. In the first 24 hours after the firing, I’ve not noticed any discussion of the reasons the board fired the two executives. Has anyone seen discussion on that point?

Trivialities presented as headline issues

3/10 – The Daily Beast – Wounded Warrior Project Spent $250,000 on Candy and Even More on Gimmicks – This article is the poster child for what is frustrating to me about the criticisms of WWP. Specifically, the focus on trivialities instead of the barely visible major issues.

The headline says WWP spent $250K on candy, yes CANDY, which is obviously irrefutable proof the organization is wasteful. The detail explanation in the article is WWP spent $250K on sodas and snacks for their staff.

That means they provide free stuff in the break room. They likely provide free coffee. Shocking! How horrible! Free soda and coffee for your staff! Patently preposterous.

Free coffee is only provided by, oh, practically every charity in the country.

(I recall one of my first supervisors in public accounting saying businesses wanting to improve productivity ought to provide free stuff in the break room with the encouragement of “here, drink all the caffeine and eat all the sugar you want – help yourself!”)

The WWP 990 for the 9/30/14 fiscal year reports there were 481 people receiving a W-2 in the year. Let’s assume that is a proxy for the number of current employees.

That means WWP is spending $519 a year per employee on snacks, sodas, coffee, and any other stuff in the break room (like coffee filters, cups, paper plates, paper towels, napkins). That works out to $10.82 a week for let’s assume 48 work-weeks a year (excluding two weeks of vacation and 10 holidays).

A whopping two bucks a day for snacks, sodas, and coffee. Absolutely inexcusable.

Article repeats the horribly harsh charge that the CEO once rappelled into a conference and rode in on a Segway another time. That would be what, maybe a couple hundred bucks for renting the rappelling gear and a hundred to rent a Segway for the day? Completely inexcusable and inexplicably wasteful in an organization that raised $342,000,000 in FY 2014.

Oh, and don’t get me started the abusive environment! New staff are expected to read the book Good to Great by Jim Collins. To top it all off, they are expected to read, attend classes on, and understand the book Five Dysfunctions of a Team. How cruel! There oughta’ be a law! Ban those books!

Here is a story idea for a future expose by some daring investigative reporter yearning for a Pulitzer – – Go after WWP for the number of staples used and the too-high quality of paperclips in the supply cabinets.

I assume there are actually some serious issues in the organization beyond bad PR since the board decided to fire the CEO and COO. There are some major issues visible late in the article which are mentioned in passing. I hope someday that the media coverage will address serious concerns instead of counting the number of soda cans carried out of the break rooms.

2/29 – Counting on Charity – Wounded Warrior Project Roundup – This is obviously old news now. Prof. Mittendorf recaps the current status of several parts of the coverage of WWP over the last month. Weakest part of the attacks are suggestions the organization spent $26M for conferences attended only by its staff. Actually that is primarily for conferences attended by program participants.

Strongest part of the critique, according to the professor, is that WWP donated $150K to Charity Defense Council. Perhaps that warrants more conversation and debate than the amount of coffee and sodas and snacks consumed by WWP staff.

Leave a Reply

Your email address will not be published. Required fields are marked *