‘Toxic Culture’ Sparks Crisis for Silicon Valley Foundation

The US’s largest community foundation, which has been backed by some of Silicon Valley’s biggest players, has been left reeling amid claims a “toxic culture” has been festering for years sparking the departure of three top executives.

The Silicon Valley Community Foundation, which has attracted billions of dollars in donations from tech giants including Facebook’s chief executive, Mark Zuckerberg, Netflix founder and chief executive Reed Hastings and Twitter co-founder Jack Dorsey, has been marred with reports of bullying, sexual comments, and an oppressive office culture.

The Chronicle of Philanthropy reported last month that Thompson Hine, a national law firm based in Cleveland, had been hired to “do a full investigation of these claims and the alleged behaviour of Mari Ellen Loijens,” the organisation’s top fundraiser.

The investigation was sparked after the Chronicle presented the organisation’s president and CEO Emmett Carson with allegations against Loijens, that included “claims that she demeaned and bullied her staff, made lewd comments in the workplace, and on at least one occasion sought to kiss a woman working for her”.

Loijens resigned from the position of chief business, development and brand officer at SVCF a day after the article was published.

Carson, who was last year honoured by the New York Women’s Foundation for “exemplary leadership in philanthropy and his commitment to bettering the lives of those in need”, initially suggested on Twitter he was unaware of the problems at his foundation and said it would not tolerate “any inappropriate behaviour”.

We are committed to a strong and healthy workplace for our staff and will not tolerate any inappropriate behavior. @siliconvalleycf believes in accountability and transparency and will share the learnings and actions from the independent investigation. https://t.co/siAHetxl02

— Emmett Carson (@emmettcarson) April 18, 2018

However he has since come under fire for allowing Loijens’s behaviour to go on for too long and for being too focused on a desire to grow the foundation.

On 25 April an anonymous letter claiming to be from 65 current SVCF employees was sent to the not for profit’s board calling for Carson and the foundation’s vice president of talent recruitment and culture, Daiva Natochy, to be immediately suspended, and for the investigation to be expanded to include their role in the alleged abuse.

The board later voted to place Carson on paid administrative leave from his role as CEO, president and board member until further notice.

Greg Avis, a former chair of SVCF who has been appointed to the position of interim CEO, confirmed Natochy had also resigned, becoming the third executive to resign or be placed on administrative leave in as many weeks.

The board of directors said it had become clear the foundation “may have a larger culture issue” that needed to be addressed.

“This includes evaluating how teams are managed, what type of working environment is being fostered and confirming that we are the type of organisation where reports of misconduct are met with swift and just action,” the board said.

“To that end, we remain committed to taking whatever actions will be required based on that investigation’s findings.”

They announced they were widening the investigation into the workplace abuse by hiring a second law firm to assist.

Avis said emerging as a stronger organisation was the foundation’s “sole objective”.

“Our strength lies in being an independent organisation and while we continue to be in a healthy financial position, it’s critical that our workplace and culture also serve our mission,” Avis said.

“We recognise that there is always room for improvement and a primary focus of the investigation that is currently underway is to ensure that all staff needs are understood and met to enable them to provide the very best service to our constituencies.”

@emmettcarson Please stop acting like you did not know! I reported both you & Mari Ellen to HR July 2017. At the end of the day, I was the one who had to leave the foundation bc it was a toxic work environment. #sorrynotsorry https://t.co/1NwCNe3YMD

— Maria A. Moreno (@maria_amoreno) April 19, 2018

In February, the foundation said it managed assets worth $13.5 billion, making it the third-largest charitable foundation of any type in the US – larger than both the Ford Foundation and the Rockefeller Foundation, and behind only the Bill and Melinda Gates Foundation and the Open Society Foundation.

However, reviews on Glassdoor, a website where workers anonymously rate companies and their management, have described a “toxic culture”, “lots of scapegoating and blaming of staff”, and claims of sexual harassment.

Currently only 14 per cent of 45 reviews would “recommend the organisation to a friend”.

The community foundation, which was formed in 2007 following a merger between the San Jose-based Community Foundation Silicon Valley and the San Mateo Peninsula Community Foundation, said 73 people had left since 1 January 2016, out of a total of about 140.  

In an article for Forbes, Kerry Dolan said the charity was at risk of “implosion”.

She speculated that many of SVCF’s large donors may be transferring their funds to donor-advised funds (DAFs) at other organisations.

“Despite the fact that SVCF’s fees are higher than at competitors like Schwab Charitable and Fidelity Charitable, it might not have the scale to compete, especially while crippled by a rigorous internal investigation,” Dolan said.

“Unlike other community foundations, SVCF hasn’t focused on building its endowment, which provides another source of fees. What happens if there’s an equivalent of a run on the bank, and big donors decide en masse to move their funds elsewhere?”

In a blog on his website, not for profit consultant Alan Cantor ascribed the foundation’s downfall to “its obsession with pleasing rich donors, a striking lack of transparency, and an embrace of growth for growth’s sake”.

“And I would argue that what amplified these characteristics into such a public meltdown was SVCF’s primary role as a sponsor of donor-advised funds,” Cantor said.

He added: “Community foundations that lose their mission focus and forget the meaning of ‘community’ — and, for that matter, nonprofits of all types that lose sight of what they are and why they exist — can find themselves following this same sad and self-destructive path.”

In an article published on LinkedIn, COO and director of gift planning at Catholic Foundation/Archdiocese of New Orleans, Josephine Everly, described the events as a “cautionary tale”.

She said there were a number of lessons those in the community foundation world could learn including “culture eats strategy for breakfast”, “speak truth to power”, and “philanthropy is a private act in a public place”.