#h#Good Governance for Less Risky Business#/h#

Nonprofit risk management: the topic may not sound sexy, but nothing can derail a nonprofit organization or keep it from achieving its mission faster than ignoring basic risks, says Jennifer Chandler Hauge, of the Nonprofit Risk Management Center in Washington, D.C.

"The first step in risk management is good governance," says Hague. "Many non-profits forget that to keep the public’s trust they must govern themselves well." Hague will speak at a seminar sponsored by Borden Perlman Insurance and the Princeton Area Community Foundation. The free seminar, "Good Governance is Good Risk Management," takes place on Thursday, February 28, at 8:30 a.m. at Greenacres Country Club. Register at 609-219-1800 or email info@pacf.org.

Today nonprofits are facing greater scrutiny than ever in how they manage their organizations and their finances. Tighter government regulations – such as Sarbanes-Oxley Act of 2002, which set new standards for reportage by public companies – not only cover for-profit corporations, they mandate specific requirements for financial reporting by nonprofits as well. And financial reporting is just the tip of the iceberg when looking at risk assessment. "Without good governance by the nonprofit board, an organization will not be able to fulfill its mission, keep its donors interested and involved, or protect its clients," says Hauge.

"It’s a very important message for non-profit board members to hear. Unfortunately, many board members act like ostriches. They keep their heads buried and assume that `because we are good people doing good things we are immune from criticism,’"she adds.

While now based in Washington, D.C., Hauge’s roots are in Princeton, where she grew up. A graduate of the Princeton Day School, her interest in working with nonprofits was sparked by her father, James J. Chandler, who volunteered for many years as a board member at the Princeton YMCA. Chandler is also known in the area for his work at the Princeton Medical Center, where he practiced for many years before joining the faculty of the Robert Wood Johnson Medical School in New Brunswick.

Hauge received her bachelor’s degree in English and French from Dartmouth in 1982 and her J.D. from Boston College in 1985. She originally studied employment law and became "intrigued with the larger problem of tax exempt issues" and laws regarding nonprofits. In the 1990s she had her own law practice in northern New Jersey. From 2000 to 2005 she was the deputy director of Pro-Bono Partnership, a non-profit organization which provides free business legal services and other resources to non-profit organizations in Connecticut, New York, and New Jersey. In 2006 she served a one-year appointment as assistant director of the Panel of the Nonprofit Sector in Washington. She joined the Nonprofit Risk Management Center as senior counsel and director of special projects last year.

"To focus on its mission a nonprofit board must assess both known risks and unknown future events," says Hauge.

Identify specific risks. While some risks are common to all nonprofits, others may be specific to certain types of organizations, but all risks should be assessed, she says. For example, a group that serves children may have risks that are different than those run by a grant-making organization.

"A group that serves children needs to be very aware of youth protection," says Hauge. It should run background checks on all employees and volunteers who come into contact with the children to make sure that they have no record of child abuse. They should also make sure that if they drive children to any activities that all of their drivers are properly licensed and that the organization has proper insurance.

The grant-making organization, on the other hand, needs to be much more conscious of financial risks, including investment trends that might reduce the amount of money they have available for grants, as well as the possibility of fraudulent investments.

Leadership and succession. "What happens when a beloved director or board chairman leaves the organization? Every organization should have a plan in place for transition," she says. Many organizations will put off developing a succession strategy until a director announces plans to retire or change jobs, but there is always the possibility of a sudden accident, illness or death. If a plan is already in place for a thoughtful transition, there is a lesser chance of problems.

The retiring Baby Boomer generation makes it increasingly likely that both board members and nonprofit executives will retire or leave their offices in the coming years. "Studies show that within the next five years there will be an 80 percent turnover of executive directors at all nonprofit organizations in the country," says Hauge. "The demographics mean there will be a growing challenge in finding new people with certain skill sets, including fundraising and administration." The shortages will show up in a variety of jobs from college presidents to CFOs, she says.

Fraud and Embezzlement. No one wants to think it can happen to them, but the scandal caused by charges of fraud or embezzlement can destroy an organization. "Don’t think that your organization only hires good people so you should trust them," says Hauge. "It’s usually not the new employee who is caught embezzling, but the long-time trusted bookkeeper." No matter how small the nonprofit, internal controls and accountability by both board and staff members must be put into place to guard against financial fraud and mismanagement.

Technology Risks. The Internet age has brought new risks to nonprofits. Even the smallest organization now keeps most or all of its records on computer, including financial records, client files, and employee records. What will happen if there is a hard drive failure? Is there a way to recover important documents? Client and employee files must also be kept secure. Technology can also bring a new type of risk to an organization’s reputation. "What do you do if someone starts blogging about your nonprofit and says things that damage your reputation?" Hauge asks.

Government Compliance. Is your nonprofit in compliance with all government regulations? The Sarbanes-Oxley Act mandates how financial data is reported, and there are other rules and regulations that board members must keep in mind, such as protection for whistleblowers.

"Sometimes an employee in an organization reports a problem and then they are suddenly fired. It’s against the law and the organization can be in big trouble if they are not aware of all the laws regarding whistleblowers," says Hauge.

She uses the example of a long-time administrative assistant who reports the possibility of fraud. "Often the employee will go to a board member or executive officer first. They won’t report something to the authorities until they feel frustrated because nothing is being done internally," she says. Once the problem has been reported to a regulatory agency, the whistleblower’s job is protected. "She may have been late to work every day for 10 years, but you can’t use that as an excuse to fire her. Once she has become a whistleblower her job is protected."

Board members must also be aware of rules regarding document destruction. No organization can keep all of its records indefinitely, so it must develop a "policy to purge records in a thoughtful manner," says Hauge. And if any impropriety has been reported or an organization is under investigation the policy should be, "Thou shalt not destroy any documents. Board members should avoid even the appearance of impropriety."

Conflict of Interest. What do you do if a board member, employee, or volunteer has a financial interest in a decision that is being made? For instance, a board member may own a construction company that is bidding on a remodeling project. Different boards have different policies, says Hauge. Some will insist that the person with the conflict of interest remove himself from all discussion of the decision. Others will feel that the person has valuable expertise that should be tapped during the discussion, but they must leave the room during a vote. "No matter what your policy is, it must be followed in every case," says Hauge.

Board members must set the policies, then make sure that all of the staff and volunteers understand and follow them.

– Karen Hodges-Miller

Saturday, March 1

#h#Money for Nuttin’#/h#

Trees symbolize a lot of things. Stability. Strength. Patience. But for most of us, even though we eat off tables and store our clothes in furniture made from wood, trees are not a symbol of commercial wealth. Environmentalists and tree-huggers pride themselves, in fact, on saving trees from the ignominy of being felled in the name of progress and commerce.

Trees are, however, a commodity. It is unlikely that they will make you rich, but they can provide steady revenue in ways you might not have imagined. It just takes a slight rethinking of what you see when you look at the forest.

Rick Conley, president of the New Jersey Forestry Association, would like more people to know just how valuable trees are all around. On Saturday, March 1, at 8:30 a.m., the NJFA will host its 33rd annual meeting at Duke Farms in Hillsborough. The event is open to the public and costs $55 (register at info@njfa.org), and it will feature several panel discussions including "Ways to Produce Income from Your Forest." The first step, says Conley, is recognizing that trees – especially in a state that is still 46-percent forested – are a sustainable, renewable, and multi-layered resource.

The first thing to understand about the business of trees, says Conley, is that it is farming, which means two things – hard work and the generation of income. In order to be classified a farm, your crops have to actually make you money, even if it is a small amount, whether your crop is the fruit of the trees or the wood itself.

Nuts to you! The benefit of being a nut farmer, says Conley, is that fruiting trees yield nuts aplenty. The crop is a hardy one and perennial. The downside is that nut trees take a long time to grow. Walnut trees, for example, can take 50 to 100 years to reach their potential. The obvious advice, Conley says, is to buy land with mature nut trees already on it, which has the benefit of longevity (mature trees produce nuts for decades), but the potential downside of being an expensive purchase.

Collecting is also a problem, Conley says. Nuts often have to be gathered by hand.

Sweet nectar. Like nut trees, sugar maples can provide a good source of money and treats, but also like nut trees, sugar maples need to be sizable in order to have any commercial syrup value. Don’t expect this avenue to make you much money though. Conley says a lot of maple farmers have day jobs.

Portable profits. More lucrative is the growing business of portable sawmilling. Unlike the traditional image of the Great White North and its burly, flannel-clad lumberjacks felling giant redwoods and floating them downstream to the mills, mobile millers come to you, carve up fallen or unwanted trees, and haul away the boards. Conley, who has four fallen trees on his farm in Hunterdon County, says that lumber sold directly to mobile sawmillers can command a good buck. A large walnut tree, past its prime, for instance, can fetch up to $5,000. But before you say "ch-ching," keep in mind that most trees in New Jersey, including walnuts, cannot come anywhere near that price. And many of the most stately trees are protected as historic.

Merry Christmas! The most commercially viable tree business is likely the Christmas tree farm. Though they tend to take up more space than most other tree-based agribusinesses – the state’s largest walnut farm is a mere eight acres – Christmas tree farms have a more controllable cycle. As opposed to the century it would take for you to cash in on a walnut business you started from a few seedlings, Christmas tree farms are up and running in seven years.

It is, admittedly, a rough seven years, says Conley. The trees are not mature until then, which means they do not bring in any money (a factor that can cause a prickly farmland assessor to revoke your status as a working farm and cause you to pay higher taxes. The trees also do not just will themselves into the plump, teardrop shapes people crave in a Christmas tree. Farmers have to prune and shape them throughout the year. And you cannot pack the trees in too tightly because they need room to grow and people need to be able to walk around the whole tree when it’s mature.

Still, says Conley, some Christmas tree farms can clear $40,000 in a season

Down on the farm. A working farm does not have to grow produce. Some people who own farms and want to keep them classified as such – the taxes are much lower than those levied against a residential lot – simply field hay, but Conley says people should consider growing trees. The uses for the trees can be diverse and quite imaginative. One of the annual meeting’s presentations is called "Gold in Your Woodlot," a slide show by NJFA director Tracy Cate that showcases how to make farm implements, such as handles, fences, or gates, from the trees on your property.

Municipal green. Farmers are not the only ones able to turn trees into cash, Conley says. An increasing trend in smaller, cash-strapped communities is to sell fallen trees to companies like Citilogs. Founded in Pittstown in 1999, Citilogs began as a small business that collected unwanted trees from urban areas and made them into furniture. These days the company collects trees as far west as Chicago, for which they pay the owners to keep the trees from occupying a spot at the dump.

Municipalities, Conley says, are increasingly taking notice. When a tree falls in town, or otherwise needs to be cut down, local governments allow Citilogs to take the trees away, thus avoiding simple disposal and making a little money in the process.

A lawyer by trade – he is a partner in Flemington’s Conley & Sozansky firm – Conley is no stranger to the farmer’s life. His uncle had a 250-acre farm in upstate New York. He grew up in Cranford, the son of a journalist father, and graduated from Williams in 1965 and earned his law degree at Harvard in 1968. New England also is the home of his wife’s family, which has owned the same farm there since 1765. These days, in addition to his law practice, Conley raises sheep at his own farm.

"There’s nothing like a farm," he says.

Conley moved to Hunterdon County in 1973 and was a judge in the state tax court for five years, appointed by Governor Brendan Byrne, before settling into his own practice. He got involved with the Forestry Association after meeting a number of farmers and discussing farm assessment law with them. He was a member for a little more than 10 years before he joined the association board and eventually moved up to be president. His job as president, he says, is to reclaim the woodlands industry in New Jersey and promote an appreciation for the benefits of trees as well as their beauty.

"Some people don’t like to see trees cut," he says. "But there is a purpose."

The NJFA meeting also will feature a keynote address on "The Future of Forestry in New Jersey" by Amy Cradic of NJDEP, discussions of and managed woodlands, an update on the Highlands and Sourlands, and literary readings by the Cool Women of Princeton.

– Scott Morgan

Sunday, March 2

#h#Fit at the Gym, But Fit For Training Others?#/h#

What is the fourth hottest job in these United States? If you guessed starting a software company or being a Presidential candidate, you are wrong. According to a recent ABC News poll, it is being a personal trainer. With half of America supersized and desperate to lose weight, and the other half in training for some sport, everyone wants some professional, human aid in reaching their goals.

It is an unfortunately easy process. Anyone who has hefted weights in the gym for a few years, or become an aerobics addict, can simply print up business cards and begin advising clients for $35 to $50 an hour. But rippling biceps or a neat physique are no guarantee of a trainer’s capabilities. The World Instructor Training Schools in Virginia Beach, Virginia, says that true trainer expertise demands intensive study, and they are offering exactly that at Mercer County Community College.

The Personal Training Certification Course lasts six weeks, beginning Sunday, March 2, through Sunday April 16, from 10 a.m. to 5 p.m., at the college’s West Windsor campus. Cost: $499. Call 609-570-3311. The course is designed for those seeking to be nationally WITS-certified physical trainers, and is taught by Kazuko Aoyagi, regional director for the World Instructor Training Schools.

Aoyagi received her bachelor’s from International Christian University in Tokyo, and Ph.D. in molecular biology from Berkeley. She has spent 20 years in post doctoral research in genetics and biochemistry. Aoyagi is certified by the American College of Sports Medicine and is on the faculty of Rutgers University, where she specializes in fitness for older adults. Her interests include ballet, yoga, running, and strength training.

Why certify? For those who see the physical trainer as merely a glorified drill sergeant, certification may seem just one more piece of bureaucratic nit-picking. But for Jay Delvecchio, president and founder of the World Instructor Training Schools, the need has been evident these last 30 years.

Raised in Philadelphia, Delvecchio attended Temple University, then shifted to Old Dominion University in Norfolk, Virginia. In each school he found himself hanging out in the weight room and becoming more interested in fitness. A few credits shy of his bachelor’s, Delvecchio took work at the Holiday Health and Fitness Club. Within six months he was manager. "I saw all sorts of well-educated people with all sorts of degrees who had no clue how real people’s bodies actually worked," he says.

Within a few years, Delvecchio launched his own gym, Streamline Fitness. He ran it for 13 years and still encountered trainers who were either totally book-taught with no hands on experience, or experienced weightlifters who could barely spell "biomechanics." Finally, Delvecchio decided it was the trainers who needed the training. With this need in mind, and the fitness industry booming, he began the World Instructor Training Schools, which has flourished since l992.

Beyond pumping iron. One individual wanders into the gym and announces to a trainer, "the doctor says I’ve got to lose a lot of this," he grabs his flab, "or it will kill me." Another comes in with a log book with 18 weeks worth of empty pages. Each page is to be filled in with a daily training regimen that will get her primed for her first marathon. Finally, a muscular youngster has a chance of playing college football, as a pulling guard. He needs an overall workout plan – oh yes, and did he mention his trick knee?

"Really capable – qualified – physical trainers have to make assessments. They set realistic goals based on the individual’s anatomy and condition; then, hands-on, they help the individual toward that goal," Delvecchio says. In each of the above cases, a physical trainer would analyze the strong points, test range of motion and flexibility. He will know the basic biomechanics, and be able to instruct how slight shifts in movement may reduce stress or increase efficiency.

To achieve all these abilities, the WIT course begins with classroom sessions in basic anatomy, ideal bodily movement, and common injuries. The body is studied as a functioning machine, from blood flow to the mechanics of muscle enhancement.

Traditional weight and strength training regimens are taught, along with myriad other forms of exercise. The ideal forms of aerobics, various flexibility exercises, aquacise, cardio workouts such as spinning, and a host of others are examined. Would-be trainers learn the proper blend of each exercise to make one lose flab, run a marathon, or make varsity.

Nutritional parameters and the whole array of various lifestyle changes are covered. "The key is always individuality," says Delvecchio. "You are helping a client become a totally new person. This demands establishing a very customized plan for all aspects of one’s life."

Trainer Shopping. When a trainer completes the six-week WITS course, he is only ready to begin the certification process. Following the class work comes a 100 question written test. Students who pass this are then given a hands-on practical test. In this exam, a mock client comes in with a fitness goal and a target date. The student must design a program for this scenario, take the client through a warm up session and a few exercises – all under the watchful eye for the examiner.

A CPR certification is next, and finally, as a last hurdle, the student-trainer must serve an internship of 20 hours with a senior trainer. Those who pass muster become certified personal trainers of the World Instruction Training Schools.

The average personal trainer in America makes $25 an hour, and can claim only 12.5 hours of outside instruction. WITS grads, who have put in so much more, charge somewhat more. But the biggest difference in trainer wages is based on location and relative wealth of the clientele.

Thus, shopping for a personal trainer is a bit like shopping for wine.

Price is no guarantee, nor is a meltingly cute smile and six-pack abs. Your better bet is to check out the amount of instruction that brought the trainer to fruition. And along with the credentials, find a personality fit. After all, you are looking for a coach to guide you in changing your life.

– Bart Jackson

Tuesday, March 4

#h#It’s Good to be Small#/h#

For some time now, nanotechnology has been the stuff of science fiction. From the old Raquel Welch film, "The Fantastic Voyage," where tiny robots rebuild human cells, to Michael Crichton’s 2002 best-selling novel, "Prey," in which a cloud of predatory micro-robots escape from a Nevada laboratory, creating an unstoppable mechanical plague, nanotechnology has captured the popular imagination.

But while there certainly are dangers and risks to nanotechnology, reality – as usual – is much more mundane than fantastic.

"Nanotechnology is a broadly encompassing word that is sometimes confusing to both legislators and investors," says Fred Allen, co-founder and director of the Greater Garden State Nanotechnology Alliance,or GGSNA, an association affiliated with the New Jersey Technology Council. "Investors think that in a couple years we’ll have nano-robots repairing cells, but scientists know that we are not even close to that. Basically, nanotechnology can relate to any applied science that can be adapted to the scale of nanometers (one billionth of a meter)."

Although nanotechnology is considered by many to be the next technological revolution, the imagination of science fiction writers coupled with past problems with asbestos, nuclear power, and genetically modified organisms have often resulted in a skepticism, both public and private. In its effort to address some of these issues the New Jersey Technology Council will offer a seminar entitled "Nanotechnology: Identifying Hazards and Evaluating Risks" on Tuesday, March 4, at 9 a.m. at Rutgers University’s Busch campus in Piscataway. Price: $125. Visit www.njtc.org.

Sponsored by Blank Rome, Woodcock Washburn, and PSE&G, the seminar will feature Igor Linkov of the U.S. Army Engineering Research and Development division, who will discuss risk management of nanomaterials; Olivier Jolliet, associate director of environmental health sciences at the University of Michigan, who will present an assessment of life cycle risk and benefits; and Chuck Geraci, coordinator of the Nanotechnology Research Center, who will present information on exposure assessment field studies, control technology evaluations, and a summary of the new medical monitoring and surveillance document.

For scientists, "nanotechnology" is a very particular word with a specific meaning that tends to get lost in generalizations. "When people say nanotechnology, they often use the word interchangeably with its subsets: nanomaterial and nanoproducts," says Allen. "A nanoproduct is made from nanomaterial based on or enabled by nanotechnology. For example, a catalyst is a material and when it is incorporated into a catalytic converter in a car, you have a nanoproduct."

An easy example of a nanoproduct that uses a combination of properties that would otherwise not be possible in a product currently on the market is suntan lotion. "There is a kind of suntan lotion that has UV protection but is optically transparent," says Allen. "These nanomaterials have contradictory properties but are combined in one system that is, from a vanity aspect, very useful."

Because many materials show unusual characteristics, such as added strength or different electrical properties, when they are manufactured as nanoscale particles, nanotechnology is also used in the production of paints, glare-reducing coatings on eyewear, cosmetics, longer lasting golf balls, light-weight and durable hockey sticks and tennis racquets, stain-free clothing, and technology for laptop computers, cell phones, digital cameras, and batteries.

Future usages include things like solar cells and portable power that can provide cheaper and cleaner energy, advanced drug delivery systems such as implantable devices that automatically sense drug levels and administer drugs, and ever smaller, more inexpensive computers – some so tiny that they can fit into fabrics.

Allen asserts that with the public already skittish about environmental, health, and safety issues, addressing these concerns is coming relatively early in the developmental process. Most scientists consider nanomaterials to be safe because they are integrated as deposit or alloys into a structure (such as a tennis racquet) and are not put out into the atmosphere as dust.

While scientists say that most nano-scale materials have no known negative health or environmental consequences, there has been relatively little research so far on the impact of making large amounts of new nanomaterials. "There are two ways to look at environmental and health risks when looking at nanotechnology: chemistry and structure," says Allen. "Materials that are fibrous in nature are materials that you don’t want floating around in the air while products that are more spherical or cubic in shape are less of a concern."

Says Allen: "From a chemical standpoint, elements like arsenic or mercury, that are usually present in small quantities, are things you don’t want to see in the soil, water supplies, or landfills on a nanoscale."

"It is all about dealing with risk mitigation," says Allen. "People want to know just who is keeping an eye on what’s going on so that those who are involved with the materials can proceed without being unnecessarily worried about such things. Because there is a higher degree of ability to manipulate these materials there is more of an opportunity for variability. That’s why there is a raised consciousness."

A resident of Princeton Junction, Allen was born and raised on Long Island. "Neither of my parents were involved in science," says Allen. "My mother really just let me be, but my father was an artist. He would take me with him to the North Shore of Long Island where he went to photograph landscapes for paintings. I used to collect the rocks that I found along the beaches and try to understand why are they here. I became interested in materials by being around them, wanting to classify and categorize them. Eventually I wanted to study them."

He earned his undergraduate degree in 1979 at SUNY Stony Brook in earth and planetary sciences. He went on to obtain his M.A. and Ph.D. degrees from Harvard University where he was a National Science Foundation fellow. He then worked at the National Center for Electron Microscopy at Arizona State University for two years. He joined Engelhard Corporation (now BASF) in 1987 and over the next 18 years conducted research, commercialized products, and served as manager of the technology assessment group.

Allen went out on his own in 2005 and founded RADii Solutions LLC (pronounced "RAD-2") in June, 2006, where he works to further the advancement of technology-based ideas and inventions through product commercialization. He has over 40 publications and presentations and 10 patent filings. He has two adult daughters as well as two young dogs. "I like the dogs because they keep a kind of youthful spirit in the house," he says.

As director of the GGSNA, Allen works to promote economic development by assisting the commercialization of nanotechnology in and around the state. He is also a member of the NJTC Board, an advisor to the Mid-Atlantic Nanotechnology Alliance, and chairman of the Nanotechnology Committee of Strengthening the Mid-Atlantic Region for Tomorrow (SMART).

While the future of nanotechnology remains bright, research and development in nanotechnology is proceeding with caution. "There are situations now where the chemistry and structure have gotten more complicated by virtue of our ability to manipulate materials," says Allen.

"There is more of a watchful eye on what that could mean in terms of interaction with the environment. This can be accomplished from the standpoint of economic development and jobs function and creation. We want to make sure that New Jersey continues to be among the finest in the world in technology development." For those further interested in nanotechnology, Allen offers the following fun facts:

Ancient Nanometers. Mankind has actually been working with nanometers for thousands of years. "In the Middle Ages, the red colors of stained glass windows were actually created due to colloidal gold," says Allen. "They knew what they were doing in a crude sense, but they didn’t know that when gold occurs on a molecular cluster of a scale of a few nanometers it scatters light in a particular way that produces a red color."

Going back even further, cave paintings from the prehistoric ages were made of pigments that created their colors because of particles on the size order of nanometers."

Catalyzing. According to Allen, the best example of nanotechnology is how a catalyst works. "A catalyst takes advantage of the size phenomenon and the way gas or liquid molecules interact with solids," he says. "It looks like it is doing something active, but it is actually just a chemical reaction that is being sped up by this material."

Funding is Good. In fact, doomsday scenarios involving nanotechnology have not negatively affected funding, according to Allen. "It is more about how fast can we make a product," he says. "It can be a nano-based tennis racquet or suntan lotion. If you can mass-produce these things on a scale that is relevant, that is what will get you funding. If you can’t get that, then it will effect your funding. They want to see that they can produce something quickly."

– Jack Florek

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