This essay will be analyzing an ethics case concerning a healthcare forum and its relations with a member of the local City Council. For anonymizing purposes, this nonprofit will be referred to as Minority Healthcare Council. This ethics issue concerns whether a nonprofit should use familial or previous employee/founding member connections to gain city funding. It also concerns the ethical choices of individuals who may have conflicts of interest between their work and nonprofits they may be personally tied to and support. This essay will dive into the case’s background, what the “right” choices could be in the given situation dependent on different ethical values, the case’s influence, and ultimate results of the decisions made by the nonprofit and involved individuals. Ultimately, this case study is an example of what kinds of consequences could result in lack of ethics training within nonprofits or city staff and potential repercussions for nonprofits who involve themselves in conflict of interest situations.
Minority Healthcare Council is a nonprofit that aims to help the community regarding education and advocacy surrounding health. They pioneer several different programs in their community to promote well-being, healthy lifestyles, heath care education, and access to information in health services. All the programs are also geared towards minority families and individuals, providing the information in different languages and focusing efforts in low income areas. The nonprofit has received city funding as awarded to them in contracts that then assists the different programs they lead.
Minority Healthcare Council was founded by a group of active members in the community, including Andrew, whom served as executive director for the nonprofit for 4 years. After this position, Andrew moved on to become a staff member for the local City Council as an aide to the city Mayor. His wife, Veronica, continued to work for the nonprofit, as chief administrative officer. According to a local news investigation, the Minority Healthcare Council received an estimation of more than $1 million in contracts in the time that Andrew was a city staff member. In addition, the investigation found that Andrew was being paid by Minority HealthCare Council for work completed as well as done for them during city time as a city staff member. The news investigation and an official complaint filed by the Deputy City Auditor led to hearings from the city’s Ethics Review Commission. Although the Minority Healthcare Council was not specifically involved in the hearings, their choices of involvement with Andrew led to the ultimate decisions made.
A utilitarian approach would factor in what “brings more pleasure than pain to all affected people” (O’Neill, 2004). In the nonprofit’s perspective, this would mean Veronica and other staff members would consider how the potentially larger amount of awarded funding would assist their program’s benefactors and the community they work towards assisting. The funding of more than $1 million received by the nonprofit during Andrew’s position within the city is worth the conflict of interest ethical issue if it means more minority folks will have access to health care resources. Therefore, Minority HealthCare Council would likely disregard how Andrew’s involvement would create conflict of interest, particularly if it meant being closer to representing and fulfilling their mission statement as a nonprofit.
For a more liberal ethical decision, the “principle underlying one’s action [is] all-important” (O’Neill, 2004). In this viewpoint, Andrew, Veronica, and other administrative members of Minority HealthCare Council, should focus their decision based around true motives. For example, Andrew would choose not to assist MHC in renewing city contracts or any sort of funding assistance through the city. Due to knowing that he is using his place of authority to potentially influence city funding, he would regard this bias as immoral and unfair to other local nonprofits competing for the same types of funding. Furthermore, as Kant would likely point out in this scenario, the other local nonprofits are worthy of respect, and thus it’s wrong to give them a disadvantage in comparison to MHC that Andrew has worked so closely to.
For a virtue ethics viewpoint, consideration must be taken to how actions will affect future actions and decisions. For example, MHC would consider how their conflicts of interest with Andrew may affect funding over time. Specifically, if they disregard the conflicts of interest, that act of ignorance does not present a good characteristic. This action could potentially lead to other nonprofits disregarding similar situations, potentially corrupting the way city awarded funding functions. Thus, a virtue ethics viewpoint would lead to not accepting any business relationship with Andrew to avoid presenting immoral characteristics.
Minority Healthcare Council chose the utilitarian approach, disregarding the potential immorality in conflict of interest. MHC continued to work with Andrew, pay him, and receive city funded awards which likely has direct correlation to Andrew’s efforts within the city staff. This case was addressed by the city’s Ethics Review Commission after Andrew had left his position as aide to the Mayor. Andrew received a letter of admonition from the city’s Ethics Review Commission, stating “The Commission determined that certain violations occurred”. Additionally, the letter states “the Commission find that the violation is minor or may have been unintentional”. In this scenario, no specific repercussions were given to the nonprofit. This is not to say there may be future difficulties in receiving city funding, thus being an influence on the future reputation of MHC.
Though this case did involve local news attention and investigation, this did not arise any wide backlash from the community onto Minority Healthcare Council. On their website, MHC currently does not include Andrew as a previous founding staff member. Veronica is now referred to on their website as CEO and founder of the organization. This in of itself could be viewed as an ethical decision, to avoid relation with Andrew for future funding endeavors within the city or otherwise. With ethics training for city and nonprofit staff, these situations are more likely to be avoided and thus lead to less unfair selections of funding for nonprofits. Seeking and applying for awarded funding is an often necessary and daily effort of nonprofit operations, and decisions based around personal connections and potential conflict of interest must be taken into consistent consideration with running such organizations.
Valarie Gold is a filmmaker based out of Austin, Texas. She is currently pursuing a MA in Media Studies & a Nonprofit portfolio at The University of Texas at Austin, focusing on youth and media literacy. She also works as a community assistant at the Austin School of Film. You can connect with her through Facebook.
How to definite "nonprofit organization"? Here are some of the class answers, what's yours? #lbjphilanthropy