Trustees Behaving Badly

Governance runs amok as rich trustees take salaries, snooze at meetings, pay staff for not working, and use art collections as ATMs.

O ver the years I’ve written about museum governance, which means trustees. Museums are not-for-profits, which doesn’t mean they’re poor. Proper museums own buildings, some bigger than Buckingham Palace. Others, though small like the Menil Collection in Houston, the Gardner in Boston, and the Kimbell in Fort Worth, are exquisite and distinguished works of art in themselves. Most have endowments. The Getty’s is $7 billion, but many museums that need to pinch pennies still have millions under the mattress. And then there’s the art.

Though all is held in the public trust, a museum’s board effectively owns the place, the cash, and the goods in service of the public. Trustees have a duty to pay attention and use good business practices in managing money. They must be loyal, which means no self-dealing allowed.

Why am I writing about trustees now? I’ve planned to write about trusteeship since my story on the Mellon Foundation a few months ago. The foundation is spending $250 million to replace public monuments that offend some people, somewhere, or someone, anywhere. It’s not the worst idea in the world, but it’s still meddlesome and faddish, and aren’t there better ways to spend money?

I read the Mellon Foundation’s federal tax return before I wrote my story. It pays its president $930,000 a year, which is the going rate for big foundation honchos, but it’s still an unseemly amount of money. The trustees get paid, too. Hiding in plain sight in the 500-page tax return is a $25,000 annual salary for each trustee.

These trustees are all rich. They’re running a foundation that’s supposed to help cultural organizations, which are supposed to be needy in addition to worthy. It’s not a business. Stewarding this work is an honor, not an income generator. It’s pro bono. It’s volunteer work. I live in rural Vermont. Half the people in my town are poor. Many are self-employed or work for tiny not-for-profits and don’t get benefits. In small towns, volunteers do most of the work that paid staff does in cities and big towns, and they do it gratis.

In the theater, dance, and classical-music worlds, unemployment is well over 50 percent because of the COVID hysteria. It’s bad enough that Mellon is spending hundreds of millions futzing with cold bronze statues of long-dead pols. That the trustees pay themselves $25,000 a year to squander these millions is an abuse of Andrew Mellon’s philanthropy.

Is it negligence? No. It’s pin money for them, I know. The tax return says that the trustees “work” five hours a week. They should be giving their time. To do otherwise is indecorous, if not gross. It’s a case of trustees behaving badly.

I wrote a couple of weeks ago about the turmoil at the Indianapolis Museum of Art (IMA) over a line in an advertisement for a new museum director. The CEO of Newfields, the campus that includes the museum and its gardens, lost his job because of it. The ad said the museum needed to appeal to a broader racial demographic while “maintaining its traditional, core, white art audience.” It’s a terrible thing to say or think. The CEO lost his job.

After a weeklong furor, during which the Lilly Endowment in Indianapolis suggested it might pull its annual $7 million gift to the museum, the trustees acted. “We are sorry,” they said, and “we are ashamed of Newfields’s leadership and of ourselves.” It’s a very good statement. It doesn’t toss jargon like “systemic racism,” a sleight-of-hand term for “everyone’s a racist.” It pledges concrete, measurable action on exhibitions, staffing, high admission fees, and community input.

Trustees don’t run museums on a day-to-day basis, but they behave badly when they think their only roles are managing the endowment, balancing the budget, and making big strategic decisions. Their portfolio goes beyond these concerns, and a good trustee, director, and institutional culture together create the right boundaries. “Looking the other way” isn’t in the trustee job description.

The IMA got into a racial buzz saw last summer when a new, African-American curator loudly quit. She said the museum committed “egregious gender discrimination” and “unbelievably toxic and racist microaggressions.” Every trustee got her resignation letter making these and other charges. It was front-page news.

The curator, as a practical matter, accused the museum of breaking federal and state anti-discrimination laws. This should have been of deep concern to the trustees, who did nothing. In the articulate, reasonable IMA staff letter demanding that the CEO quit, sent to the trustees last week, signers said the current table of organizations “fails in providing a path for employees to voice their concerns through official channels.”

Where did the trustees go wrong? They erred in two ways. First, the HR function at the museum is weak, and the trustees should have known this. Human Resources and “Guest Experiences” exist in one department, which is weird. “Guest Experiences” is a Disneyland word for “visitor services,” and this has nothing to do with HR. The HR office in a museum is centrally important, and the HR director belongs among the senior staff, but almost all museums bury the department.

HR exists in a museum not as an honest broker between management and workers. HR exists to keep management from getting sued. There is some overlap, though, and a strong, respected HR director is an effective mediator. Trustees behave badly when they allow directors to keep the HR function weak. The director and department heads want to smother dissent. They want to punish unruly employees if they can’t force them to quit.

Here, the trustees have a philosophy-making role that borders on day-to-day management. Much as they need a finance director who isn’t a dupe of the museum CEO, they need an HR function that solves problems before they become disasters. At the IMA, the HR director joined the CEO in a robust defense of the “traditional, core, white audience” language when the staff complained that it was both ugly and awkward. It’s one thing to have a CEO who’s dumb. A dumb HR director can cause real trouble.

Trustees don’t need to have spies, but a good trustee at a civic museum like the IMA where everyone is local ought to gather information from places other than the director. Serving as a clandestine informant is indeed a cheap thrill, and having clandestine informants helps trustees keep the director on his or her toes. Trustees do need to take an interest in who the HR director is, where he or she sits in the organization, and whether or not the HR director is a keeper of standards. At the IMA, the trustees surely knew the atmosphere wasn’t healthy.

Bad trusteeship happens all the time. Until the #MeToo movement, trustees often elevated eye aversion to an Olympic sport. Directors engaged in not only heavy petting but outright whoopee with subordinates. Not so many “See No Evil” monkeys in the boardroom now, but it still happens, I’m sure. Anne Boleyn, Catherine of Aragon’s lady-in-waiting, will be the first to say that these office peccadillos rarely end well.

This month the Metropolitan Museum of Art trustees decide whether or not the museum will raid its vault and sell art to balance its budget. The director, Max Hollein, floated the idea a few weeks ago. I wrote then that, internally, the Met’s leaders had already decided to monetize the collection and were starting the process of marketing this dreadful idea. With the top staff behind it, let’s see if the trustees will pull the trigger.

The honchos at the Met don’t have the cojones, to quote Cervantes, to align expenses and revenue. The COVID crisis is unique in that the government recklessly created a depression that killed the tourist economy, dinging the Met’s business plan. On the one hand, the Met now has a deficit. On the other, its endowment has soared with a good stock market.

The 1 percent are fine, mass hysteria notwithstanding, and that includes the Met. Among the casualties are children whose unionized teachers won’t work, the unlucky duckies who can’t Zoom for a living, and the small businesses crushed willy-nilly.

The Met is experiencing a financial blip, and it’s responding with callous, uncharacteristic opportunism. When the coronavirus hit, the museum field’s professional association swooned. It hastily tweaked the longtime ban on art-for-cash raids to allow the sale of art for budget relief “for two years only” and as a desperation measure. Is the Met desperate? No, and Hollein admits this. He dances around the question. He says that 30 percent of American museums “might” close for good. This is a canard. And the Met has a $150 million deficit, he adds. This is false. No one is making whoopie, but Hollein is peddling whoppers.

I “might” win an Olympic gold medal not for trustee eye aversion but, say, for ice dancing, but I won’t, ever. And that 30 percent of American museums “might” close for good has nothing to do with the Met. The Met is still funding new initiatives, including its equity-and-diversity drive, and it’s still paying a big staff, many of whom are working inefficiently from home.

The problem is that the Met’s director and president don’t want to make tough decisions, like matching expenses to revenue. That’s painful. It makes people sad and then irksome, and executives can’t seem to deal with an irked, mouthy staff anymore. The president, Dan Weiss, made $1.2 million in 2018. The director gets a cool million. They’re making the big bucks to do the hard calls.

If the trustees of the Met — and this is the most prestigious art board in America — break the piggy bank, then most museums will do the same. Trustees all over the country will bully directors to sell art to run their museums so they don’t have to give money to make ends meet. At the college and university level, few trustees count the school museum as a top priority. Some barely know it exists. These museums will be prey, and the trustees and college presidents predators. The Met won’t make deaccession blunders like breaking up sets of objects or selling masterpieces, but lesser lights will. Do the Met’s trustees want to invite shenanigans throughout the national museum community?

And don’t think the Met’s own curators won’t feel a squeeze. Before long, the Met will soon have a revenue line in its operating budgets for cash from deaccessions. Think of it as a 10 percent or 20 percent tax that the curatorial departments have to pay the administration to keep themselves whole. The curators heading departments will be pressured to produce a flow of deaccession income. Will the bean counters take “no” for an answer when curators balk?

With the Met using its collection as a cash cow, the “two years only” part of the change in the museum profession’s ethics rule will surely be extended. There’s a constituency among public-health bureaucrats and control-freak politicians who want the COVID hysteria to run as long as Hello, Dolly! Charlatans like Fauci (the Porky Pig of publicity hogs) and Cuomo (Emmy Award winner for grandma liquidation) love the power. The next time a recession or a stock-market crash happens, collection sales will fill diminished coffers. Soon, every capital campaign will draw from sales of art.

The best thing the Met’s trustees can do now is behave like leaders should. They need to tell the hired help to defer expensive exhibitions and reduce the number of high-paid positions.

The Met has a new fair-pay initiative that needs to go forward. The president and director have to raise this money, and it should be easy to do. They’ve drunk the Equity-and-Diversity Kool Aid, though, and that’s expensive. Consultants will soon descend on the museum to tell the staff they’re all racists. This is a waste of money as well as intrusive and disruptive. The museum has also hired an expensive diversity czar who will duplicate functions that the HR office should perform were it operating properly. It’s a shame and a sham to sell art to pay for spending that caters to faddists, cranks, and complainers. It won’t be a coincidence when the money raised by selling art will match the cost of the Met’s diversity boondoggles.

I don’t think a museum trustee has ever done a perp walk for gross negligence, operating in bad faith, reckless indifference to the interests of the museum, or spending funds for purposes well beyond the museum’s mission. That said, the Chinese coronavirus kills, but it also weaves a tangled web of deceits. COVID is forcing everyone to do shady things.

Museums in California have been closed for a year. Museums in Washington, D.C., Illinois, Massachusetts, Pennsylvania, and in other states and cities have been closed off and on for months. During these lockdowns, most if not all staff have gotten paid. Many, including art handlers, art conservators, and curators, either can’t work from home at all or, practically speaking, can be truly productive for only a few weeks. If trustees are paying staffs that are doing nothing, using tax-exempt, charitable dollars, is this negligence?

I think it is. Museums, for instance, in California, to use an extreme example, should have gone to barebone staffing months ago. Even the Getty, with a $7 billion endowment, is, at the end of the day, a charity. A charity shouldn’t be paying people who aren’t working, however kind that is, though I don’t doubt it’s the humane thing to do in a narrow sense.

Still, there are hundreds, if not thousands, of arts groups that furloughed all their actors, musicians, and dancers. Millions more worked for small businesses that were forced to close, so they lost their jobs. Museums able to float big payrolls for months while closed obviously aren’t needy, but there are questions that go beyond this, and beyond the injustice of some sectors suffering badly while other sectors suffer not at all.

The federal government established the Payroll Protection Plan and enhanced unemployment benefits to deal with COVID layoffs. If a charity has no productive work for staff because of coronavirus lockdowns, then the charity has a dilemma. It can’t ethically pay people for doing nothing or for keeping them on retainer or on call. The solution to this dilemma is the federal and state unemployment system. That means big layoffs, as horrifying as this is, but charitable dollars can be spent only for a charity’s work. If the government safety nets like the PPP program aren’t there any longer, the museums need to take that up with their congressional representatives and senators.

Charities like museums that continue to pay staff full-time salaries for vastly reduced productively are helping government hide the cost of the COVID lockdowns — the worst case of government malfeasance in the history of the country. I’m not ideological, and this sounds as if I’m picking ideology over on-the-ground practicalities. I simply believe that trustees need to ask unpleasant questions and plumb the happy talk they’ll likely get from directors on just how feasible it is for most museum staff to “work from home.” Before museums raid their collections to pay for COVID façades and pretenses, trustees need to ensure that charitable money is spent for work that’s actually happening and advancing the museum’s mission.