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	Where Was the Board? By Steve Bailey Boston Globe May 24, 2006 http://www.boston.com/business/technology/articles/2006/05/24/where_was_the_board/ Does the board of directors of Keane Inc., the Charlestown technology-services company, hold its chief executive to a higher standard of personal conduct than does the board of Caritas Christi Health Care System, the Catholic Church's hospital chain? The comparison is irresistible. Earlier this month the Keane board forced out its chief executive, Brian Keane, after he was accused of sexual harassment. Last week the Caritas board privately reprimanded its chief executive, Dr. Robert Haddad, after he was also accused of sexual harassment. Of course, the circumstances were different: Two women came forward to accuse Keane of inappropriate behavior; four women came forward initially to complain about Haddad's hugging and kissing. The number is now well into double digits. Yesterday, Haddad was edging to the exit. But in this era of heightened director responsibility, the board's passive response to the serious charges against its chief executive is stunning. And all the more stunning -- even bizarre -- considering the church's immediate sorry history of dealing with victims of sexual abuse. Did the Caritas board learn nothing at all? Consider: Confronted with allegations that Haddad kissed female employees on the lips, rubbed them on the back and called them late at night to ask about highly personal matters, not a single board member asked to read a 30-page report detailing the incidents, according to the reporting by Globe Spotlight chief Walter Robinson. Or asked to hear from the lawyer who investigated the complaints. No one asked to hear from Helen Drinan , Caritas's first-rate head of human resources, who wanted Haddad fired but was disinvited to the board meeting by Cardinal Sean P. O'Malley. Not one asked to hear Haddad's side of the story, either. No one joins the Caritas board to get rich. There are no big directors' fees, no fat option awards. (That is not to say there are not conflicts. Dr. Kenneth MacDonnell, the Caritas board chairman, makes $212,000 a year as the chairman of medicine emeritus. He didn't return my call.) They are on the board because they are good Catholics; they believe in the church's mission; and they believe that running a good health care system is a concrete expression of those values. But good intentions are no substitute for good stewardship. Nonprofit boards have learned that while they have no shareholders, they are no less accountable. If anything, they need to be held to a higher standard. Investors in public companies understand they are putting their money at risk. A nonprofit like Caritas is overseeing parishioners' donations; it is not selling jeans or tires to consumers but tending to the sick and the needy. The Caritas directors are there for their judgment and experience. Business guys like Meredith & Grew dealmaker Kevin Phelan, the vice chairman, and Nick Lopardo should know better. Particularly, you might think, Lopardo. As head of State Street Global Advisors, Lopardo played a starring role in the infamous "Pink Pump" saga in the late 1990s, in which he was accused of presiding over a locker-room culture at the big Boston money manager. If nothing else, Lopardo should have learned -- and advised his fellow directors -- that stuff like this does not stay under wraps. Lopardo didn't return my call; Phelan declined to comment. It was two years ago that the Caritas board sat passively as O'Malley fired Dr. Michael Collins as chief executive. Now it sits just as passively as O'Malley gives the board the information he chooses on Haddad's behavior. It is not the way corporate governance is supposed to work in the year 2006 -- not in the for-profit sector or the nonprofit sector. Any board member not up to the job needs to step aside for someone who is. In an organization where 79 percent of the employees are women, a more balanced board would help. Of 16 board members, only two are women, one of whom was attending her first meeting last week. Would women have seen those kisses as not so benign? Steve Bailey is a Globe columnist. He can be reached at bailey@globe.com.
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