Saturday, November 16, 2013

Let’s Put our Hearts into the Future of our Cultural Life

I urge the Cultural Life Task Force to let go of a half-century old approach and get with the 21st century emphasis on direct involvement in the excitement of the arts, science and history within the Charlotte region—not only as audience members but also and most importantly as donors.

Most of us make tax-deductible contributions to causes or nonprofit organizations each year.  For example, you may give to the university you attended, to a food bank, the Red Cross or the Charlotte Symphony.  You personally make the decision about where your gift will go, because you personally believe in the value of the services of these groups.  You believe strongly in what they do and when you make your gift, you feel good about it.  It’s direct and it’s personal.

This is what true philanthropy is all about.  It comes from our passion about a cause or service.  That kind of feeling is missing with a united-fund approach (aka ‘work-place giving’) that has been operating here for over fifty years.  Gifts by workers under this approach go to the Arts and Science Council which then disperses those funds to the various arts/cultural groups according to certain criteria.  The original donor has no say in how her funds are used.  Recently, there has been some choice included in the campaigns, but the system remains at best an indirect way from the donor’s standpoint of supporting arts and culture.

The recent recession demonstrated a weakness of this system.  The ASC, the ‘middle-man’ of this approach, lost 65% of support from businesses and foundations since the recession.  If direct and personal philanthropy had been the major approach since the late 1950s, the effect of the downturn might not have been so severe.  More importantly, the various arts and cultural groups would not have developed a certain level of dependency upon the ASC.  Most of the larger organizations receive a quarter to a third of their total budgets from their annual ASC grant.  Their staffs get very used to seeing they have to raise only 66% or 75% of their total expenses, because the ASC grant will be there for them.

What should the Cultural Life Task Force do?  What should we do?  The Task Force will be in closed sessions until it issues its recommendations in early 2014. Hopefully they will be willing to hear your ideas.

I recommend that we begin to move to a direct and personal philanthropic model to support our cultural life in Charlotte-Mecklenburg.  Work-place giving does not have to totally disappear, but it should be significantly reduced.  I would suggest a ten-year transition period to the personal philanthropic model.  This would give the organizations time to ramp up their cultivation and direct solicitation programs targeted to individuals who have a direct interest in the organizations’ art, science and history missions.  The ASC can be a catalyst to this change, offering training assistance and other resources encouraging individual involvement and giving.


Let’s connect our fellow citizens and their families directly with the talented and devoted people who make art, explain history and demonstrate science.  Culture is not about selling cars or houses.  Culture is all about an experience.  You can’t buy it, take it home and put it on the shelf.  Culture is all about touching our emotions, our heart.  And personal philanthropy is all about giving from the heart.  Let’s make that happen here.

Tuesday, September 17, 2013

Comment on Charlotte City Council Subsidy of Carowinds

Dear Editors:

I had to laugh reading the comments of City Council members who supported the subsidy for the Carowinds expansion.  Carowinds’ owner Cedar Fair Entertainment probably paid millions for the adjoining 61 acres two years before the subsidy matter came up. What was their intention?  To establish housing for the homeless?


Where are all the ‘free market’ warriors who scream to get government out of our lives? Council should not ask staff to consider revision of this excessive freebie program, but instead vote to scrap it.

Sunday, August 18, 2013

I responded recently to an essay on Charlotte Viewpoint [ http://www.charlotteviewpoint.org/ ] by Suzanne Fetscher, head of the McColl Center for Visual Art.  Here is her essay with my observations to follow:


Building relationships to raise funds
by Suzanne Fetscher
Charlotte Viewpoint
July 30, 2013

I am a really slow learner. I have been working in the cultural nonprofit sector for a long time. It is only now that I feel that I am comfortable in philanthropy work. What took so long?

When I consider my experiences in fundraising over the last twenty-three years, I recall how terrified I was when faced with the duty of fundraising as a newly appointed Executive Director. I felt paralyzed by the prospect and hid out in my office to avoid the task. I wanted to be successful at it for the sake of my institution but felt so intimidated by the image of asking very important wealthy individuals (who intimidated me already) for their money.

So I focused on grants. It seemed much easier. I had the same perception of many of my board members. There are foundation pots of money “out there” for the asking; one just has to write a grant. “Can’t you write a grant for that?” a well-meaning board member would suggest. They, too, didn’t like fundraising and wanted to avoid it by suggesting another route to funding a special project or need. It was a reflex response to any funding issue. “Just write a grant.”

Working with our grant writer and researching on my own, I quickly learned that being awarded grants requires a process of research, cultivation, and relationship building similar to those when fundraising from individuals. It can take years to identify potential funders, establish a relationship with them, and write a request that they may or may not fund. Crafting a compelling grant request takes time and artistry, and involves sound business planning and program evaluating methods. It must demonstrate impact. Writing a thoughtful, well-researched single grant may be a multi-year process.

I came to realize that the common denominator between asking institutions for money and asking individuals for money is relationship. And that takes time.

The best part of the grant-writing experience was meeting with the program officers of the Knight Foundation, PEW Charitable Trusts, Lila Wallace Fund, and Creative Capital. It started to give me confidence in my ability to make a strong case for our institution’s mission, history, and future plans. It also taught me the importance of building relationships over years.

However, perhaps the most important lesson for me was the importance of learning that fundraising isn’t about me (was I a good fundraiser?) or my institution. It’s about the goals of the foundation or the individual or corporate philanthropy department and learning if there is goal-alignment between their institution and mine. It’s about making a good match of core values, goals, and impact, Not about whether the funder is supporting the “right” cause or whether my institution is that “good cause.” This has helped me care more deeply about the conversations that I get to have with donors and funders. I get to learn about their institution’s passions and motivations and, if it’s an individual donor, what they would like their legacy to be. I get to create a deep and meaningful relationship between them and my institution. What a gift it is to me to act as the facilitator of that relationship.

Recently, I was fortunate to participate in Charlotte’s Leadership Gift School. Leadership Gift School is presented by a consortium of funders: the Foundation for the Carolinas, Charlotte Mecklenburg Arts & Science Council, Carolinas HealthCare, Blumenthal Foundation and others. The brilliant program is designed and led by Chris McLeod, an independent fundraising consultant in Charlotte, and Karla Williams, author and national fundraising consultant. Through that remarkable program, I have come to love philanthropy and see it as a unique and noble calling. I owe the consortium of funders and Chris McLeod and Karla Williams my greatest thanks.

I am a slow learner. My life lessons and those lessons learned from program officers at foundations taught me much about authentic relationships built upon shared values and goals. Leadership Gift School taught me that those lessons are instrumental in philanthropy and creating vibrant and meaningful impact for individuals and community.

My Comment
August 6, 2013
                                   
Charlotte Substituted Efficiency in Place of Passion for the Arts
John Clark

In her admirable self-effacing essay, Suzanne Fetscher offers a positive and accurate portrayal of what philanthropy is all about.  Many of us working to sustain organizations and missions would agree with her admission:  “I have come to love philanthropy and see it as a unique and noble calling.”

Ms. Fetscher’s essay indirectly illuminates the costs to this community when it adopted 50 years ago a united fund model (UFM) to raise money for the arts.  In short, the model takes a top-down, centralized approach through an annual campaign conducted primarily through corporations, businesses and the professions.  In fact, a major reason city leaders created this type of model was to minimize the number of requests to the business community for support. Charlotte organized its approach through the Arts and Science Council (ASC).

The various arts and science organizations, which became annual grant recipients with funds through the campaign, had over the years 25 to 33% of their budgets covered by this revenue source.  This encouraged a degree of dependence by these organizations on the ASC.  For example, an organization would garner about 30-35% of its budget from ticket/admission sales, 20-30% from its annual fundraising efforts, and the balance from project grants, advertising and other miscellaneous sources.

As a result of the UFM, the emphasis at these organizations tended to be project/campaign oriented fundraising:  brochures mailed to season ticket sales, letters going out soliciting annual support donations.  Donors tended to be viewed as ticket-buyers, or annual donors not as individuals with a potential passion for the art form.  In other words, there were very little resources—time, energy, knowledge—placed upon cultivation.

In short, there was very little of what Ms. Fetscher describes as exciting to her about philanthropy:  “I get to create a deep and meaningful relationship between them and my institution.”

Had Charlotte not adopted the UFM  a half-century ago and instead had allowed an open environment for arts, cultural and science organizations to develop and nourish passionate donors, a number with deep pockets, our arts scene would be a lot different. Our organizations would have experienced many decades to seriously cultivate individuals who initially show an interest in their plays, their concerts, their dance performances and their art collections.

At the beginning of the last decade, the Nashville Symphony Orchestra embarked on an aggressive endowment campaign.  Nashville has no UFM and is smaller than Charlotte. Because it had to cultivate individuals over the years, the campaign was very successful. The endowment was increased from $23M to $123M with 35 individuals giving $1M and one donor giving much more.

I am not saying that a city without a UFM approach will be able to attract huge numbers of wealthy donors.  I am suggesting only that Charlotte tied its hands by keeping a UFM approach in place for a half a century.  No one knows what would have happened with an environment friendlier to philanthropy.  I would bet, however, our groups would be more effectively endowed than they are now and, consequently, much better off today. And, maybe more importantly, there would be more knowledge and appreciation for the arts generally.



Thursday, November 1, 2012


Socialism.  What does it mean? (2009) 

What is socialism?  This philosophy has received an unusual degree of attention recently.  Initially, it was used as a one-dimensional attack via Joe the Plumber by the McCain forces at the end of the presidential campaign.  As a result, it prompted several letters to the Citizen-Times and was the subject of a few local opinion pieces. 

In each exposition, the term never received a fair description of what it means. When it is used, it becomes in our slogan-driven public forum a meat ax to pound an opposing candidate or cause.  Clearly, an attempt to define socialism in this limited space runs a significant risk of oversimplifying. In taking that risk, let me add that my purpose is not advocacy but clarification. 

In a nutshell the major purpose of socialism is to provide the opportunity for each individual in society to develop to his or her fullest potential. Although capitalism may intend that indivudals will develop their talents and capacities, socialism makes it the primary goal. 

The first priority of capitalism, on the other hand, is through industry and commerce to create a profit or surplus value through the production and exchange of goods and services.  Individuals do benefit and great wealth may be produced through its enterprises. But many individuals do not gain and the cause is not solely attributable to intelligence and motivation.  A system that is designed to maximize profit for owners and investors guarantees, regardless of motivation and hard work, that a significant number of citizens will come out with less. 

The continuing debate between conservative and liberal capitalists is how much government is needed to lessen the pain of profit-driven economics.  The former argue that “big government” gets in the way of the free-market; the latter advocate for government to assist the many who are trampled by the ‘free market.’ 

The discussion is never about what kind of society do we really want.  Capitalism offers an indifferent market that produces by its nature a few haves and many have nots.  Socialism develops a society to provide the opportunities for each of us to develop our talents to the fullest.  Socialism cannot produce the amount of wealth that capitalism can, but it would not create the extreme artificial inequalities that capitalism inherently spits out. 

Democracy can operate just as well in a socialist society as in a capitalitist one.  In fact it would be more democratic.  The large number of individuals and families in poverty are a blight on the quality of democracy in a capitalistic culture.  This would not be the case under socialism.  With free education and healthcare, each individual would live in an environment that encourages excellence. Consequently, one could argue, the ethics of an entreprenuriel spirt and service to the community would go hand in hand to create a true practice of community.
 

So the next time a politician derides his opponent as a ‘socialist,’ it may in truth mean higher praise than intended.

 

 

 

 

 

McColl misfires on Utilities Commission’s duty to probe Duke



Charlotte Observer  July 25, 2012

McColl misfires on Utilities Commission’s duty to probe Duke

From John Clark, station manager of WDAV for 18 years, now retired, in response to Hugh McColl’s “Regulators should stay out of Duke Energy’s board room” (July 22 For the Record); reach Clark at alfven@att.net:

I don’t live in Raleigh and don’t have friends, relatives or associates in state government public oversight agencies, but I did find Hugh McColl’s opinion article disappointing.

First admission: I have a great deal of respect for Hugh McColl and his many salient contributions to the life and fabric of the city of Charlotte. I’ve met him a few times and like him.

Second thought: Hugh would have been better served by not requesting the Observer publish his writing. He should have first counted to ten.

The public utilities commission is charged by law to look out for the public’s interest in the matters of a regulated utility. What is a regulated utility? It simply is an organization that is providing such a vital service to the people of a specific region that it gets government approval to operate as a monopoly. A regulated monopoly.

Consequently, it operates neither like the tire store down the street nor like Bank of America. That’s an important distinction that Hugh fails to note. He did cite his experience as head of a company that was regulated – although those regulations over time continued to be eliminated in part through his efforts – and he even admitted he was chairman of his BofA board, which seems to me to contravene at least the spirit of board oversight of the CEO, a position he held at the same time he was chairman.

In short, let’s get real. Boards of directors do indeed have the fiduciary responsibility for the operations of a company and specifically the performance of its CEO. But in reality, and I would argue particularly at BofA, many boards are but a group of yes-men and women. Witness the actions of CEOs with board approval at both BofA and Wachovia leading right up to the Great Recession. Wachovia is gone and BofA has been crippled.

The public utilities commission is within its right and duty to investigate this matter. Whether or not it finds any action punishable by law is not the issue now. It is representing the interests of people like me, especially those citizens in the Raleigh area who, through the merger, are losing a corporate headquarters (we in Charlotte now know what that’s like) and some who will be losing their jobs.

Hugh, your article was right on as a general description of businesses and business boards. Within the context of the Duke-Progress Energy merger and the way it was conducted, your view totally misses the mark. Copyright 2012 . All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

 

Sunday, August 5, 2012

On July 12, 2012, Scott Provancher, the CEO of the Charlotte Mecklenburg Arts and Science Council (ASC), 'sounded the alarm' about the current model on which the ASC operates. His article appeared on the Charlotte Viewpoint website and in it he promised a second article in which he will propose a solution.  I commented on his article and suggested a particular direction for the ASC to take. My article follows Scott's piece:
Sounding the Alarm  by Scott Provancher

I recently gave a keynote speech to a group of community leaders at the Annual Meeting of the Rockford (Ill.) Area Convention and Visitors Bureau. My good friend John Groh, the CEO of the Visitors Bureau, asked if I would be willing to talk about the role that social innovation plays in building vibrant cities.
I have a fond place in my heart for Rockford because they took a risk in hiring me to serve as the Executive Director of the Rockford Symphony when I was just 24 years old—an opportunity that became a defining leadership experience for me and a spring board for both the Rockford Symphony and my career. So when John called, I immediately said ‘yes’.
Preparing for this speech also gave me an opportunity to clarify in my mind what social innovation really means and the role it must play in ensuring Charlotte’s continued growth and prosperity.
Simply defined, innovation is an idea that creates value. There is a plethora of ideas in the world, but few create lasting value. To me, social innovation is the most elusive, yet most important form of innovation—a novel idea that creates value for the public good.
Examples of great social innovations, such as the development of language, irrigation, and the public library system, immediately come to mind. However, one doesn’t need to look back thousands of years or even outside of their own community to witness the importance of social innovation.
In fact, the development of the Arts & Science Council (ASC) was a social innovation. The pressing issue of the time was how a city poised to grow economically in the coming decades could ensure that it had the arts and culture offerings necessary to attract, retain, and inspire the needed workforce and their families.
Despite Charlotte’s prospects for future growth, it had a dilemma. More mature communities had built their arts and cultural amities through the generosity of a select few—famous philanthropists like Mellon, Rockefeller, Carnegie and Guggenheim had both significant resources and saw the importance of a cultural life for a community. Without that kind of wealth, however, Charlotte would need to innovate in order to accomplish this feat.
Through the visionary work of community leaders from both the public and private sectors, a groundbreaking partnership was formed. The ASC as we know it today was developed as a unique non-profit umbrella organization that would receive both public support from the city and county, and leverage that investment to inspire donations from companies and individuals through corporate and workplace campaigns. The dollars raised would not only help lead the creation of new venues and programs, but also provide operating support for a burgeoning group of arts and culture organizations.
What resulted was nothing short of a miracle. Over a 35 year period, more than $1 billion (52% private and 48% public) was leveraged to literally build a city centered on arts and culture. This innovation helped to make Charlotte the envy of other cities that by now are seeing stagnating urban cores and failing arts organizations, but is a significant economic engine for our community, generating over $200 million in annual economic impact and 6,200 full-time jobs.
Our funding model is no longer working
At the risk of being an alarmist, I am concerned that the entire funding model that fueled our cultural explosion over four decades is no longer working. Even before the economic downturn, the underlying system that had fueled the growth of the cultural sector was quietly and dramatically shifting without a true understanding of the consequences. The most significant shift came in two forms 1) how companies partner with ASC to fundraise in the workplace and 2) the City of Charlotte and Mecklenburg County funding structure for the arts and cultural sector.
Workplace giving was the single greatest growth engine for the cultural sector in the past, and it provided much needed operating resources to keep the doors open for organizations like Children’s Theatre, Discovery Place, Charlotte Symphony and a dozen others.
A Foundation For The Carolina’s sponsored task force in 2008 affirmed the crucial role of workplace giving for the future of both the United Way and ASC affiliates. However, the train had already left the station. Since the time of the task force report, the dollars raised in ASC’s workplace campaigns dropped almost 40%.
There is no doubt that the workplace giving model was seeing signs of its age before the economic downturn, and the task force agreed that a significant overhaul was needed to meet the changing needs of employees and employers. But the speed of this changing landscape left two huge non-profit sectors without the runway to develop a meaning alternative for the community. This is something that we still need to resolve.
Another quiet shift remained virtually unnoticed because of the tremendous growth in the private sector. The role that the City of Charlotte and Mecklenburg County plan in the partnership to fund the cultural sector.
An important aspect of the ASC model is that the City of Charlotte and Mecklenburg County would in essence outsource the function of a cultural affairs department to ASC, thus enabling a big savings on overhead and ensuring the greatest percentage of dollars going directly to the community.
These dollars also play an important role in the private-sector partnership by encouraging the private sector to match the public dollars committed to the partnership. However, over the last decade the public-private leveraging has become a lopsided arrangement, with the private sector now tackling the lion’s share of the annual support of the arts and culture sector.
Through a series of decisions beginning in the early 2000s, Mecklenburg County gradually reduced ASC funding until it reached an all-time low in 2010. During this period, total City and County funding for arts and culture decreased by 36%, while the overall City and County budgets increased significantly.
The need to forge a new path
All that is to say, the once-innovative model that was developed to support the arts and culture sector will need to be reinvented to meet the growing needs of our community.
The great Peter F. Drucker made a profound observation when he said, “Business has only two functions –marketing and innovation. All the rest are costs." In other words, the function of business is to develop products and sell them to customers.
The ASC and Charlotte-Mecklenburg is no different. We must design solutions that provide community value and ensure their success. Going back to the old model for support of arts and culture is simply not possible. The change that our community has seen is significant and, like our community did decades ago, it will need to forge a new path forward to ensure our cultural assets continue to flourish.
When I stood on stage in Rockford, behind me were two juxtaposed pictures: the Charlotte skyline in 1976 and one in 2012. I looked at the audience and said, “Do you want to see what innovation can do for a city? Look no further than the transformation of Charlotte.”
The arts and culture sector was one of the most significant catalysts in this transformation. With the help of the community, our key civic and corporate partners, I am confident we will find a way to accelerate our arts and culture sector and continue to make Charlotte one of the best places in the world to live. Innovation is how we can do it.
________________________

John Clark Response: 

I commend Scott Provancher for suggesting the current ASC model supporting cultural arts fundraising in Charlotte-Mecklenburg is no longer working.  Five years ago (January 2007), just before the Great Recession began, I offered a critique of the approach in a Charlotte Observer op-ed piece.  It garnered support from professional musicians, dancers, painters, poets, singers, actresses/actors and other individuals from our arts community and was generally panned by the ASC and other arts organization directors.  No surprise there. 

Naturally, I am interested in Scott’s upcoming solution to the problem and in the meantime would like to offer some thoughts about the model as it has worked in our community.  My purpose is not to revisit the past per se but rather to note certain inherent weaknesses of the model with the intent to steer clear of them in the design of a new approach to supporting the arts. 

The united fund approach for the arts, borrowed from the United Way by many cities, was primarily begun to minimize the number of financial requests to the business community from arts and cultural groups.  Another reason, as Scott cited, was the business need to achieve an arts environment “...necessary to attract, retain and inspire the needed workforce.” As you see, doing it directly for the benefit of the arts was not high on the list. 

The major strength of a united fund model is its efficiency. Organized by the ASC, hundreds of individuals volunteer through their places of work cover various sectors of the community (professionals, education, retail, etc.) to solicit employees to give to the annual fund.  Scott notes during the past 35 years, 52% of the $500 million raised came from the private sector.  That’s $260 million.  Break down that figure as an average for each of those 35 years and it is only $742,857.  Not all that impressive. 

Here’s why.  While this model is efficient as a workplace campaign, it denigrates the true nature of giving.  The experience of true philanthropy is exciting, inspiring and very rewarding.  An individual makes a gift directly to an arts organization such as the Charlotte Symphony.  She does so because she enjoys the concerts and is moved to give money beyond simply buying tickets to the performances.  It’s the emotional connection with the Symphony that is most meaningful in her gift-giving.  This connection increases over the years and is reflected by her greater involvement and in larger gifts to the Symphony. 

That experience is largely missing in the ASC united fund approach.  Sure, there are key volunteers who get involved in the campaign and are highly motivated.  It’s short-term, however, not only because it occurs once a year, but also because it’s a fundraising project, not an arts-making endeavor. 

If you’ve been living here for a while, you’ve heard the horror stories of employees, especially at the larger companies, being pressured not only to give to the ASC campaign but to give based on the level of their salaries.  I know of a friend who worked at one of our big banks whose work team had to go on a retreat to deal with sore feelings from such pressure.  This is akin to turning donors into mercenaries with the ‘pay’ being the fact you won’t lose your job or be overlooked for promotion. 

Even in its more benign form, that is not true philanthropy and hardly the way to build over the decades a true philanthropic environment for the arts.  And it does take time for that to happen.  Yet, because Charlotte opted for the united fund approach 35 years ago, we’ve lost a lot of time. 

Clearly, it’s difficult to say what would have happened if we had not gone the united fund route.  The symphony in Nashville nurtured a major donor.  She was instrumental in their impressive campaign of raising $123 million within five years.  Recall our ASC raised in private funds only $260 million in 35 years.  In choosing the road of developing a philanthropic environment for the arts during the past four decades, Charlotte may have produced a number of wealthy arts philanthropists (it did and does have very wealthy individuals).  More importantly, it would certainly have produced many more authentic donors who would have a direct giving relationship with an organization that actually made art—music, drama, dance, singing, painting, sculpting, etc. 

I hope the new direction the ASC takes is to foster that philanthropic environment to nurture individuals now in the 30s and 40s to experience the joy of giving directly to a group that is making art for our community.  The ASC can increase its role as an incubator for arts groups to learn how to raise funds and promote their art forms.  The ASC could work to get people excited, not about a fundraising campaign, but about a campaign that puts us in the center of our local arts world.  One that truly moves our hearts.








Thursday, July 26, 2012

I responded to an opinion article in the Charlotte Observer by former Bank of America CEO Hugh McColl. It also was published in the Charlotte Observer.  McColl's article is first followed by my response:

Printed from the Charlotte Observer - www.CharlotteObserver.com

Posted: Sunday, July 22, 2012

Regulators should stay out of Duke Energy’s board room

From Hugh McColl Jr., retired CEO of Bank of America:

In 53 years of living in North Carolina, I believe I have only written two letters expressing an opinion on public matters, but today I must express my concern for the future of North Carolina.

I am deeply concerned over the North Carolina Utilities Commission’s challenge of Duke Energy’s board of directors’ right to hire and fire their CEO. Such interference will cause companies considering relocating to North Carolina or remaining here to question whether North Carolina is truly a business-friendly state.

I was a director of a public regulated company for more than 25 years and was chairman of the board for 18. As CEO, I worked for the board and understood that my job was generally secure for the day. In addition, I was on the board of two other regulated companies in transportation and insurance. In short, I know what authorities and responsibilities boards have.

One of the principal functions of the board is to hire and fire the CEO. They have the authority to do so, and most important, the fiduciary responsibility to see that the company is well led. The people who wrote and adopted our corporate laws settled this issue long ago. If regulators insert themselves into matters of the board room, they chill the business atmosphere for our state.

One does not have to agree with or applaud the decision of any board, but they must respect it legally. The directors are elected by shareholders, and if the shareholders are unhappy with the board, they have the right to replace them. One could add that we citizens can do the same with our elected leaders.

It should also be said that the stockholders of both companies approved the merger and elected the board whose decision is now being challenged. One doubts that many institutional stockholders gave much weight to the proposed management structure. More than likely, they were interested in efficiencies and earnings potential of the combined entity. Duke Energy has been and will continue to be well-managed.

In addition, Duke Energy has been a good corporate citizen in all the states in which they operate. I believe that will continue. Lastly, one could argue that the commissioners who have had a professional association with Mr. Johnson should recuse themselves from these deliberations.

One hopes that the Commission will avoid further interference into the corporate governance of Duke Energy. It is not in the interest of North Carolina consumers or businesses or the state.

        
July 25, 2012  Charlotte Observer
McColl misfires on Utilities Commission’s duty to probe Duke
From John Clark, station manager of WDAV for 18 years, now retired, in response to Hugh McColl’s “Regulators should stay out of Duke Energy’s board room” (July 22 For the Record); reach Clark at slfven@att.net:
I don’t live in Raleigh and don’t have friends, relatives or associates in state government public oversight agencies, but I did find Hugh McColl’s opinion article disappointing.
First admission: I have a great deal of respect for Hugh McColl and his many salient contributions to the life and fabric of the city of Charlotte. I’ve met him a few times and like him.
Second thought: Hugh would have been better served by not requesting the Observer publish his writing. He should have first counted to ten.
The public utilities commission is charged by law to look out for the public’s interest in the matters of a regulated utility. What is a regulated utility? It simply is an organization that is providing such a vital service to the people of a specific region that it gets government approval to operate as a monopoly. A regulated monopoly.
Consequently, it operates neither like the tire store down the street nor like Bank of America. That’s an important distinction that Hugh fails to note. He did cite his experience as head of a company that was regulated – although those regulations over time continued to be eliminated in part through his efforts – and he even admitted he was chairman of his BofA board, which seems to me to contravene at least the spirit of board oversight of the CEO, a position he held at the same time he was chairman.
In short, let’s get real. Boards of directors do indeed have the fiduciary responsibility for the operations of a company and specifically the performance of its CEO. But in reality, and I would argue particularly at BofA, many boards are but a group of yes-men and women. Witness the actions of CEOs with board approval at both BofA and Wachovia leading right up to the Great Recession. Wachovia is gone and BofA has been crippled.
The public utilities commission is within its right and duty to investigate this matter. Whether or not it finds any action punishable by law is not the issue now. It is representing the interests of people like me, especially those citizens in the Raleigh area who, through the merger, are losing a corporate headquarters (we in Charlotte now know what that’s like) and some who will be losing their jobs.
Hugh, your article was right on as a general description of businesses and business boards. Within the context of the Duke-Progress Energy merger and the way it was conducted, your view totally misses the mark. Copyright 2012 . All rights reserved. This material may not be published, broadcast, rewritten or redistributed.