[Foundation-l] Chapters

[Theo10011]

In line replies to Nathan.

On Mon, Aug 29, 2011 at 4:59 AM, Nathan <nawrich at gmail.com> wrote:

> Several points in reply to Theo:
>
> 1) You don't need to argue the value of having chapters around the world.
> No
> one debating that. It's accepted that effective global outreach requires
> effective local partners, and that local chapters are the way to achieve
> the
> best results. I think its generally well known that there are countries
> where it is problematic to receive large amounts of money from foreign
> organizations, or to send money overseas. But...
>

We agree.


>
> 2) Organizations that receive money under the aegis of the WMF need to
> understand that the WMF has a legal and ethical duty to ensure that the
> funds are well spent. This isn't a "US vs. other places" argument - its a
> "the WMF has to meet its obligations to the community" argument. As an
> organization that strives to be far more accountable and transparent to the
> public than a normal non-profit, these obligations greatly exceed the
> minimum requirements of law. I'm sure many nations have strict laws
> governing the operations of non-profits, and we all hope and expect that
> all
> chapters meet and exceed these minimum requirements... but the chapters
> must
> meet the Foundation's expectations for transparency and fiscal
> responsibility, not just the what is required by law.
>

Actually its under the aegis of Wikipedia, someone here pointed out a recent
landing page where Wikipedia is mentioned at least a dozen times and
Wikimedia 3-4. You might recall the last fundraiser and Director of
Wikipedia incident with one of the banners, those are 2 distinct things. The
entire notion that WMF has to meet its obligation to the community is a
far-reaching statement, if you've been on Foundation-l long enough, you know
most people here might dispute that, regardless of your opinion. There are
couple of threads on Foundation-l already, that disputes if WMF meets its
own obligations to the community. And then there is the problem that the
foundation never laid out those expectation of transparency and
responsibility and said X chapter fails and Y doesn't. It did, however
remove all chapters (except WMDE) from fundraising all together.


>
> 3) Your point about the nature of non-profit organizations doesn't make
> sense as a response to what I said. Perhaps you can re-read what I wrote
> and
> reconsider your response.  Regardless,  I'm not sure I understand exactly
> why people opposed to the new requirements of the WMF are ignoring the
> obvious fact that chapters can continue to raise funds on their own.
> Grants,
> some sorts of partnerships, direct contributions, etc. The Board letter is
> not "You can't raise any funds at all" its "You have to do X, Y and Z in
> order to join the WMF fundraiser."
>

Let me reiterate, Non-profits such as Oxfam have local organizations that
they direct funds to. When an individual gives to Oxfam he's probably giving
to his local organization. When you visit Oxfam.com you will see a box with
the nearest local organization, you can donate to, on your right- that is a
model followed by several large Non-profits. Now, how that fits into the
nature of Wikipedia and the nature of fundraising - WMF tried several other
methods of fundraising as did chapters, but they all paled in comparison to
a banner on Wikipedia. WMF has been relying on that method primarily, but
since it's only US based, it can't offer the same tax-deductibility in all
those countries, that's where chapters might come in (See your point 1)
where they might be able to raise funds WMF simply can not and do outreach
better than a global organization (as in the case of Oxfam), then there is
the issue of entitlement, should WMF be the sole beneficiary of all proceeds
raised in the name of Wikipedia?


>
>
> Let's just reiterate the requirements described by the Board letter:
>
> *"* An organization can directly receive donor funds as a payment processor
> if
> the following criteria are met:
> ** There is sufficient money raised in the geography to merit the
> logistical
> effort.
> ** The organization offers tax deductibility or other incentives to local
> donors.
> ** Regulatory issues about any international funds flows are fully
> resolved.
> ** The organization's current financial resources are not enough to fund
> proposed program work.
> ** The Foundation can confidently assure donors to the chapter that their
> donations will be safeguarded, that our movement's transparency principles
> will be met, and that spending will be in line with our mission and with
> the
> messages used to attract donors.
> * The donation process should clearly disclose basic facts about the
> organization receiving the donation."*
>

Someone made this distinction a while ago, do remember that it is WMF's
board. Not the movement's, the chapter's or the community's. Its responsible
for WMF governance not the movement's.


> Tax deductibility may be a major challenge or impossible in some
> jurisdictions. Which other criteria are so onerous that folks are reacting
> like the letter indicts the entire system of chapters? Here's how I
> interpret what the Board has written:
>
> (a) Regulatory issues have to be resolved, which was true (in order to
> protect local organizations from liability) regardless of this letter.
>

No one disputed that. But no one addressed the issue or communicated it with
the chapters, they were just removed from fundraising.


>
> (b) Having many times more money than planned is a risk obvious to anyone.
> The WMF is trying to prevent a situation where chapters have huge bank
> accounts but no organizational capacity or financial controls. That means
> diligent and clear accounting according to international accounting
> standards, controls against the risk of theft, fraud or misappropriation,
> and outside independent audits. Such demands are the basic responsibility
> of
> the WMF to donors it refers to chapters.
>

There are 2 issues here, one, is the notion of sitting on huge piles of
cash, which I would argue would not be the case for all chapters who raised
their own funds, even if they are, that alone does not qualify any suspicion
(Assuming Good faith) at the same time, WMF might chose to sit on an even
larger amount of reserve (since its dealing with several times more money)
and still not have the same scrutiny. It is permitted and legal in both the
cases. Second, there aren't any laid out international accounting standards,
just the local ones for local organizations which for some reason are
inherently not enough but the US one's for WMF are.


>
> (c) Chapters who receive money from the WMF should disclose in detail how
> much money they've received and how it is being spent, to the WMF and the
> movement community. As above, funds should be "safeguarded" by appropriate
> financial controls (which may or may not be mandated by law in any
> jurisdiction). Money received through the WMF should be spent solely on
> movement goals.
>
> (d) Chapters receiving money should disclose to donors the chapters'
> nature,
> history, composition and leadership.
>
> Why anyone should object to these requirements is hard for me to
> understand.
> I can see why chapters would be perturbed about needing to meet them on a
> short timeline, but generally speaking they should all have had these as
> aims to begin with.
>

Again, no one has argued, not even the chapters themselves that their should
not be some internal standards for accountability. Almost every chapter
agreed about the issues, but instead of addressing them and establishing
standards or a system, the ability to fundraise or join in fundraising has
been denied altogether. That is the reason for contention.

Theo