Amid controversy, Wounded Warrior Project ousts two top execs
By DAVID BAUERLEIN | The Florida Times-Union, Jacksonville (Tribune News Service) | Published: March 11, 2016
JACKSONVILLE, Fla. (Tribune News Service) — The Wounded Warrior Project fired two top officials in the wake of news reports accusing the group of wasteful spending.
Chief executive officer Steve Nardizzi and chief operating officer Al Giordano are no longer with the organization, according to a statement released by the veteran support group’s board late Thursday.
The statement said the organization needed new leadership to strengthen some policies and procedures while also helping to “restore trust in the organization among all constituencies.”
The board created an “Office of the CEO” that will be led by board Chairman Anthony Odierno working with top members of the current executive team.
“It iqas now time to put the organization’s focus directly back on the men and women who have so bravely fought for our country and who need our support,” Odierno said after the board meeting.
Since relocating its headquarters to Jacksonville in 2006, Wounded Warrior has rolled up huge fundraising numbers and climbed to the No. 38 ranking on Forbes magazine’s list of the nation’s biggest charities. About half of the nonprofit’s roughly 600 employees work in Jacksonville and the rest are spread across 23 other offices nationwide.
The departure of Wounded Warrior’s top executives did not surprise Bonnie Upright, a longtime participant in Jacksonville’s nonprofit sector who has worked in the field of public relations. She said the national media reports put a spotlight on the organization and it needed to assure donors.
“Once that ball starts rolling, it’s difficult to stop,” Upright said. “Clearly, there are some questions, and the board had full authority and should be asking those very difficult questions.”
In late January, CBS News and the New York Times unloaded in-depth reports on the organization that raised questions about whether the organization spends too much on its own staff, such as an annual “all hands” event at the five-star Broadmoor Resort in Colorado. The board announced Feb. 1 it would do an independent investigation.
The board said the review found “some policies, procedures and controls at WWP have not kept pace with the organization’s rapid growth in recent years and are in need of strengthening.”
That includes travel policies to “more explicitly limit” domestic air travel to economy class unless there is a health or disability reason for more costly seating. The review found the “vast majority” of air travel was in economy class, but less than 1 percent might have been booked for first-class or business class.
The board announced it also will tighten policies related to other unspecified expenses for employees and board members while stepping up employee training about existing and new policies and procedures.
But the review also concluded that “certain allegations raised in media reports were inaccurate,” the board said in its statement.
For instance, the employee conference at the Broadmoor Resort cost about $970,000, rather than the $3 million figure reported in media accounts. But the board added it would be scaling back on such events.
The review stood by Wounded Warrior’s position that 80.6 percent of spending goes to programs, as opposed to the 54 to 60 percent amount that news reports cited from charity watchdog organizations.
Wounded Warrior’s figure includes $40.9 million in fundraising costs that Wounded Warrior says are appropriately considered spending on programs because the fundraising messages also promote awareness of the programs that veterans can get. If that nearly $41 million were not counted as an expense for programs, the percentage spent by Wounded Warrior on programs would drop to 67 percent.
The review said Wounded Warrior Project uses an outside organization that works for other nonprofit organizations to determine how to put fundraising expenses into the column for spending on programs, and independent auditors have agreed with the allocation.
The review also said of the $26 million spent by Wounded Warrior on conferences and events in the 2014 fiscal year, about 94 percent was associated with program services for veterans and their families.
The review disputed a comment that Wounded Warrior’s practice in communicating with veterans is “we don’t call warriors, warriors call us.” The board said from 2013 to 2015, the organization reached out with 150,000 phone calls and 114,000 emails.
The law firm Simpson Thacher and Bartlett and FTI Consulting did the review, which involved examining financial records and conducting interviews with former and current employees throughout the organization, up to senior management and the board of directors.
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