“where the buck stops” in terms of responsibility. E.g., if there is a really big fuckup, is the CEO of CEA or the individual projects ultimately responsible? The new CEOs of EVF? Ultimately the board?
I’m thinking that it’s still ultimately the board, but not sure.
whether the CEOs of EVF had responsibilities pertaining to common challenges that the projects have (e.g., figuring out liabilities and common actions around FTX), or whether they will have oversight over the parts of each project that are located in each jurisdiction, or some other option
I’m getting the impression that it’s more the first, but not sure.
Who’s responsible if there’s a really big error? Good question—it depends in part on the type of issue.
Project Leads:The project leads (e.g. Luke Freeman) continue to be responsible for running their projects (Giving What We Can). If there’s a programmatic, strategic, or tactical error within a specific project, that reflects on the project lead. They’re still the ones in charge of their projects; the Interim CEO appointments don’t change that.
Interim CEOs: The Interim CEOs are responsible for a different set of issues than project leads. They’re primarily responsible for charity-wide issues, including legal response, coordination, and org structures, etc (that is, things that span multiple projects: 80k, CEA, GWWC, etc). Some of their errors will be less visible to e.g. the average EA Forum user, but we expect to hold them responsible for things related to the smooth operations of the charities as a whole.
Boards: In addition, the respective board is also responsible if there’s a problem anywhere within EVF US or EVF UK. At the end of the day, they’re the bodies that are responsible for those charities. This is a less direct responsibility; as is typical for boards we delegate most of that responsibility to executives (both project leads and CEOs). So if there’s a project-level error, this could both be a project lead error and also a board one. (For example, boards could have put the wrong person in charge of the project, done inadequate oversight, etc.). The same goes for Interim CEO error.
Relatedly, the project leads still report directly to the boards for most aspects of their roles. There are some exceptions, though, as Interim CEOs set charity-wide policies and systems that may affect project leads.
That’s how it’s working today. The roles are new, so we’re still in the process of fleshing out all of the details, and things may also change over time. Ultimately, though, this additional interim CEO role doesn’t significantly change the project leads’ authority.
Minor clarification:On a first read, I wasn’t clear if you were asking whether the CEO of CEA is responsible for all of EVF. I don’t think that’s what you’re saying, but just in case there’s any ambiguity here, that’s definitely not the case (and technically there is no CEO of CEA). Max Dalton is the ED of project CEA. He has control over that project but not the rest of EVF (just as e.g. Luke Freeman is ED over GWWC, and has control over that project but not the rest of EVF).
Some amount of increased risk-aversion is probably unavoidable here. One of the downsides of being an EVF project, vs. an independent organization, is that any Bad Stuff spills over into the rest of EVF and affects other projects. It’s easier to justify gambling, and allow project leads to gamble with less oversight, when only the gambling project is exposed to the risk.
I suspect that one of the things the Charity Commission may be concerned about is the difficulty of the Board maintaining effective oversight of a corporation with what sounds close to having a dozen direct-to-board reports prior to this change. The level of oversight over project leads was probably seen as insufficient in light of each lead’s ability to do things that significantly affected EVF UK as a whole.
I suspect that one of the things the Charity Commission may be concerned about is the difficulty of the Board maintaining effective oversight of a corporation with what sounds close to having a dozen direct-to-board reports prior to this change. The level of oversight over project leads was probably seen as insufficient in light of each lead’s ability to do things that significantly affected EVF UK as a whole.
This was also my guess, but it sounds so much more polite when worded as a hypothesis that the Charity Commission had rather than as a direct question.
(My personal take based on general theory; not representing any kind of official position or based on specifics of EVF:)
Yeah, combining lots of projects in a small number of legal entities probably increases risk aversion some, relative to them each having their own legal entities. There are various reasons for this, and it’s not clear whether it’s net good.
On the hard analysis (i.e. just looking at ~economic incentives): first order is that it decreases inappropriate risk tolerance since projects that might be judgement proof by themselves are no longer so as part of a larger entity. OTOH it might be that the ecosystem systematically underincentivizes taking upside risks. If large upside risks were correlated with large downside risks (e.g. some activities are just high-variance), which is plausible, it could be bad to asymmetrically make projects internalize downside risk, even though internalizing externalities is usually good. (Impact markets might help here, but have issues of their own …)
On the soft analysis: people may be inclined towards ambiguity aversion, and really not wanting any project to have serious downsides for other projects. This would suggest you might get more risk aversion than is appropriate. OTOH the whole setup could lead to more systematic analysis of risks, in a way that helps to avoid unknowingly taking risks, which is probably an improvement.
Or if you’re asking about the introduction of the Interim CEOs: you might have a concern that they’d be overly risk-averse, if they get the blame for big problems, but don’t get credit for big successes by the projects. I agree that this is a worry in theory; pragmatically, the respective boards will be holding Howie and Zach accountable for “is this a structure which encourages project leads to make appropriately ambitious plans?”, which should help to mitigate it some (probably not all the way because it’s a harder thing to hold them accountable for than whether there were big problems).
Overall my guess is that “effect on risk aversion” is not one of the most important factors for whether this is a good setup.
After a quick skim, I couldn’t really figure out
“where the buck stops” in terms of responsibility. E.g., if there is a really big fuckup, is the CEO of CEA or the individual projects ultimately responsible? The new CEOs of EVF? Ultimately the board?
I’m thinking that it’s still ultimately the board, but not sure.
whether the CEOs of EVF had responsibilities pertaining to common challenges that the projects have (e.g., figuring out liabilities and common actions around FTX), or whether they will have oversight over the parts of each project that are located in each jurisdiction, or some other option
I’m getting the impression that it’s more the first, but not sure.
Who’s responsible if there’s a really big error? Good question—it depends in part on the type of issue.
Project Leads: The project leads (e.g. Luke Freeman) continue to be responsible for running their projects (Giving What We Can). If there’s a programmatic, strategic, or tactical error within a specific project, that reflects on the project lead. They’re still the ones in charge of their projects; the Interim CEO appointments don’t change that.
Interim CEOs: The Interim CEOs are responsible for a different set of issues than project leads. They’re primarily responsible for charity-wide issues, including legal response, coordination, and org structures, etc (that is, things that span multiple projects: 80k, CEA, GWWC, etc). Some of their errors will be less visible to e.g. the average EA Forum user, but we expect to hold them responsible for things related to the smooth operations of the charities as a whole.
Boards: In addition, the respective board is also responsible if there’s a problem anywhere within EVF US or EVF UK. At the end of the day, they’re the bodies that are responsible for those charities. This is a less direct responsibility; as is typical for boards we delegate most of that responsibility to executives (both project leads and CEOs). So if there’s a project-level error, this could both be a project lead error and also a board one. (For example, boards could have put the wrong person in charge of the project, done inadequate oversight, etc.). The same goes for Interim CEO error.
Relatedly, the project leads still report directly to the boards for most aspects of their roles. There are some exceptions, though, as Interim CEOs set charity-wide policies and systems that may affect project leads.
That’s how it’s working today. The roles are new, so we’re still in the process of fleshing out all of the details, and things may also change over time. Ultimately, though, this additional interim CEO role doesn’t significantly change the project leads’ authority.
Minor clarification: On a first read, I wasn’t clear if you were asking whether the CEO of CEA is responsible for all of EVF. I don’t think that’s what you’re saying, but just in case there’s any ambiguity here, that’s definitely not the case (and technically there is no CEO of CEA). Max Dalton is the ED of project CEA. He has control over that project but not the rest of EVF (just as e.g. Luke Freeman is ED over GWWC, and has control over that project but not the rest of EVF).
Also, I am curious whether this setup leads to more risk-aversion.
Some amount of increased risk-aversion is probably unavoidable here. One of the downsides of being an EVF project, vs. an independent organization, is that any Bad Stuff spills over into the rest of EVF and affects other projects. It’s easier to justify gambling, and allow project leads to gamble with less oversight, when only the gambling project is exposed to the risk.
I suspect that one of the things the Charity Commission may be concerned about is the difficulty of the Board maintaining effective oversight of a corporation with what sounds close to having a dozen direct-to-board reports prior to this change. The level of oversight over project leads was probably seen as insufficient in light of each lead’s ability to do things that significantly affected EVF UK as a whole.
Edit: increased risk-aversion
This was also my guess, but it sounds so much more polite when worded as a hypothesis that the Charity Commission had rather than as a direct question.
(My personal take based on general theory; not representing any kind of official position or based on specifics of EVF:)
Yeah, combining lots of projects in a small number of legal entities probably increases risk aversion some, relative to them each having their own legal entities. There are various reasons for this, and it’s not clear whether it’s net good.
On the hard analysis (i.e. just looking at ~economic incentives): first order is that it decreases inappropriate risk tolerance since projects that might be judgement proof by themselves are no longer so as part of a larger entity. OTOH it might be that the ecosystem systematically underincentivizes taking upside risks. If large upside risks were correlated with large downside risks (e.g. some activities are just high-variance), which is plausible, it could be bad to asymmetrically make projects internalize downside risk, even though internalizing externalities is usually good. (Impact markets might help here, but have issues of their own …)
On the soft analysis: people may be inclined towards ambiguity aversion, and really not wanting any project to have serious downsides for other projects. This would suggest you might get more risk aversion than is appropriate. OTOH the whole setup could lead to more systematic analysis of risks, in a way that helps to avoid unknowingly taking risks, which is probably an improvement.
Or if you’re asking about the introduction of the Interim CEOs: you might have a concern that they’d be overly risk-averse, if they get the blame for big problems, but don’t get credit for big successes by the projects. I agree that this is a worry in theory; pragmatically, the respective boards will be holding Howie and Zach accountable for “is this a structure which encourages project leads to make appropriately ambitious plans?”, which should help to mitigate it some (probably not all the way because it’s a harder thing to hold them accountable for than whether there were big problems).
Overall my guess is that “effect on risk aversion” is not one of the most important factors for whether this is a good setup.