Air Date: Week of June 20, 2003

The Nature Conservancy has made significant changes to its conservation policies, following a Washington Post series that outlined some of the non-profit’s more questionable activities. Host Steve Curwood talks with the Conservancy’s president Steve McCormick about the reasons behind the changes.

Transcript

CURWOOD: The nation’s wealthiest conservation organization is making significant changes in the way it does business. The Nature Conservancy temporarily suspended many of its activities earlier this month after an investigative series in The Washington Post raised questions about loans to employees, tax-sheltered land deals with insiders, and oil and gas drilling on conservation land.

Now, its board of governors has come up with new standard operating procedures. Joining me to discuss the changes is Conservancy President Steve McCormick. Welcome to Living on Earth.

MCCORMICK: Thank you very much, Steve.

CURWOOD: Let’s go down the list of changes that you made at the recent board meeting of the Nature Conservancy, the significant ones. Can you just tick them off for me, please?

MCCORMICK: Sure. The board established a policy that stops any purchase or sale of land to or from a member of our board of governors; a trustee, which is a volunteer advisor at our state level; and employees or their immediate families. It made sure that any charitable gifts associated with a sale of land to a so-called conservation buyer – where we impose significant restrictions—is legally documented as part of the transaction. Third, we established that there will be no loans of any sort to employees, even to assist with relocation, which is what they were all used for. Fourth, we won’t initiate any new oil, gas drilling, or mining of hard rock minerals on preserves that we own. We’ve only done that twice in 52 years but we thought, nonetheless, we should, for appearances’ sake, not do that again. And finally, that we would enlist a group of independent, outside experts to help establish a standard of best practice for governance of an organization like the Conservancy, that’s highly decentralized and which has a culture of innovation through competent risk-taking.

CURWOOD: I want to talk to you, in particular, about the Shelter Island transaction that attracted so much attention by The Washington Post. There was this parcel of land, I think it was about ten acres or so, that someone associated with the Nature Conservancy -- at the end of the day-- was able to purchase for about a half a million dollars. And at the same time make a substantial donation – I think perhaps it was a million and a half, or 1.6 million dollars -- to the Nature Conservancy, in the form of a charitable donation, and therefore tax deductible. At the same time, as I understand it, the property was appraised for a total like 2.1 million dollars. Now, to someone looking at this transaction, it looks like the Nature Conservancy got this person, essentially, a discount. What’s your response?

MCCORMICK: If someone makes a contribution to National Public Radio of $100, and you get a CD set worth $50, you’re entitled to a contribution of $50.

CURWOOD: Absolutely.

MCCORMICK: So in this case, we put the property on the open market. We weren’t able to find anyone who was willing to buy it for $500,000 except this one couple. And they bought it for $500,000, and they could easily have said that’s the end of the deal. But they thought the Conservancy is an organization they believe in, and they gave us a 1.6 million dollar contribution. And they’re entitled to do that because they weren’t required to make that contribution whatsoever. They bought property worth $500,000 when no one else would do that. In the last two, well, say five years, we’ve done well over 5,000 different transactions. We’ve probably done in the order of 15 to 20 with people who’ve had this kind of relationship – with trustees. And in every case that I’m aware of, it’s the trustee who has come to our help, not someone who has been given an inside opportunity . Nonetheless, because they are called trustees, and their involvement on chapter boards, which are simply advisory boards – because that does leave an impression that they are an insider, we want to avoid even the hint of impropriety.

CURWOOD: Let me ask you about another thing that came out of the board meeting. And that was to “not initiate new oil or gas drilling, or mining of hard rock minerals on Nature Conservancy preserves unless required by existing contracts.” What does that mean in terms of continuing to drill as part of an existing contract on that project in Texas City, Texas, which is home to the endangered Atwater’s prairie chicken?

MCCORMICK: We’re looking into whatever legal obligation we may have. There are a number of other parties that have fractional interests in the subsurface oil and gas rights. And if we’re under some contractual obligation , then we would be unable to do that without their concurrence.

CURWOOD: It seems that The Nature Conservancy could have avoided a lot of bad press had you made these internal changes before The Washington Post series came out. Why did you wait to make these changes now?

MCCORMICK: I would say that the Post series accelerated and intensified examination of these kinds of practices. But, as I say, what the Post didn’t, I think, properly reveal is that we’ve been going through a number of changes. But inasmuch as the Post coverage implied that there are appearances of impropriety, it was appropriate for the board to address those concerns, and reassure our members and our supporters and those who are loyal to the Conservancy that, although they’re legal, although all the activities are well within accepted practices, that we would sort of go to a higher standard and assure people that we are mindful of perceptions of our work, as well as the substance.

CURWOOD: Steve McCormick is president of The Nature Conservancy. Thanks for taking this time with me today.

MCCORMICK: Thank you, Steve.

 

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