Would additional whistleblower protection help curb illegal practices at non-profit organizations like The Nature Conservancy?
In 2002 new laws known as Sarbanes-Oxley made sweeping reforms designed to curb the tide of management corruption in for-profit companies. One of those provisions was legal protection for employees who report wrongdoing by their employers. The logic was that insiders are most likely to see corruption and have access to documentation that would be needed by enforcement to correct the actions. But the law does not apply to non-profit organizations.
The CPA Journal recently covered the views of some people who feel that Sarbanes-Oxley should be extended to cover non-profit organizations. The trouble is that majority of employees at The Nature Conservancy fundamentally support the organization’s mission of acquiring the world’s undeveloped land at taxpayer’s expense, even when that means stepping on landowner rights or bullying municipal governments. The fact is that The Nature Conservancy is so large and so powerful that it is virtually uncontrollable by any overseer, including the federal government. Prior investigations by Congress and the IRS documented misdeeds but failed to result in any meaningful changes or punitive actions. It seems unlikely that additional charges by whistleblowers would result in any different outcome.
While whistleblower protection may be an effective means of corruption control at smaller non-profit organizations, it is unlikely to make much difference at The Nature Conservancy.