CHARLOTTE, N.C. -- When John Mackay announced Friday that he was stepping down as president of Discovery Place, he became the latest to join a growing exodus of Charlotte’s most respected nonprofit leaders.
At least 35 of the city’s nonprofits have changed leaders in the past year, an unprecedented exodus that experts say could hurt the city for years to come.
A broad spectrum of organizations are affected, including the Arts & Science Council, Council for Children’s Rights, Thompson Child & Family Focus, Discovery Place and Charlotte Family Housing.
One theory is that most of the resignations are because of the nation’s economic recovery, as executives ready to move on have finally found a way.
But they’re not the only ones leaving. Beneath the top leadership departures is an even more telling series of resignations involving development directors – the ones who drive fund raising efforts.
The recession-era financial woes of Charlotte’s charities are well documented, including campaign shortfalls at United Way, the Red Cross and the Boys & Girls Clubs.
“Just a month ago, there were 20 fundraising positions open at nonprofits, and these are hard jobs to fill in the best of times,” said Kathy Ridge, who’s LevRidge Resources helps nonprofits during leadership transitions. “These are the people most in the hot seat now in the nonprofit world.”
It’s donors that may have more reason to worry, however.
Tens of millions of dollars in grants have been awarded to local nonprofits in recent years, with a belief that trusted charity leaders would follow through on complex projects.
What happens when those trusted leaders leave?
“The executive director is the key ambassador and the key fundraiser,” Ridge says. “They are a critical part of the agency’s relationship with stakeholders: Not just major donors, but companies that have sponsored programs.”
Adding to the air of uncertainty are leadership changes with city and county governments, which are partners in nonprofit efforts that include housing the homeless and improving education on Charlotte’s west side.
Brian Collier of Foundation for the Carolinas says the departures have become so commonplace that many people may miss the bigger impact.
He predicts more resignations in coming months, too.
“There’s something going on here. Some of it’s good, and some of it’s not so great for the community,” says Collier, calling it a “huge loss” when respected community leaders decide their best opportunity is to leave the city.
“Many of the changes occur very quickly, and we don’t have a chance to develop the relationships necessary to hand off a program and initiatives.”
A worst-case scenario is instability that leads to a lack of confidence in an agency’s ability to provide services, he says.
“It can also lead donors to either withhold donations or to decide to donate to another organization,” Collier says.
Tom Lawrence of the Leon Levine Foundation is among the funders who have taken note of the ongoing changes in leadership.
He says the Levine Foundation invests a lot of research into making sure its grant recipients have strong leaders and a track record of success. The foundation also expects nonprofits to have a succession plan in place, he says.
“For us, highly effective leadership is critical,” Lawrence says. “We consider our grantees as partners … and a partnership means we need to understand how they are going to generate impact with our investment.”
Among the nonprofits that recently took a new leader is Thompson Child & Family Focus, a charity that offers programs for children in crisis.
Ginny Amendum retired this year after leading the agency for 17 years and was replaced with Marco Tomat, the CEO of a similar York County nonprofit that merged with Thompson.
The agency has a $20 million budget, about $2.5 million of which must be raised through various annual fundraisers.
Tomat concedes it has been a challenge to meet fundraising goals this year and adds that he’d be “naïve” not to suspect it might have something to do with a new leader.
“They (donors) want to get to know me and see how we turn the corner,” Tomat says. “A lot more people are asking for money these days and there are a lot less resources. It just means we have to be more innovative.”
The recent exodus of leaders follows a period during the recession when Charlotte saw 10 big name charity executives leave their jobs.
A Foundation for the Carolinas report earlier this year noted the glut of departures is not just happening in Charlotte and it is gaining steam.
One national study, conducted by Bridgespan, said 78 percent of the nonprofits surveyed expect their executive director to leave within the next five years.
Departing leaders in Charlotte have cited reasons ranging from retirement to better opportunities elsewhere. Some left the nonprofit world completely.
Collier notes one of the challenges nonprofits face is that many don’t have the “bench strength” necessary to promote from within. This is due largely to budget cuts that eliminated staff development, he says.
The foundation wants to work with the community to create solutions. Possibilities include sabbaticals for nonprofit leaders to recharge, or creating a leadership round table “like a think tank,” Collier says.
However, he admits that Charlotte first needs to decide if it has the will and the resources to take action.
“The work of the nonprofit sector is too important to leave this situation to chance,” Collier says.
“Right now, we’re just getting people to understand the challenge in the nonprofit sector and we expect to start thinking of solutions with the community in coming months.”