In the news
LONDON FREE PRESS, October 3, 2009:
In January, just weeks after Orchestra London made its hail-Mary pitch to city council for a $500,000 loan to stave off impending bankruptcy, David Leighton raised his hand and softly spoke from his seat at the orchestra’s annual general meeting.
A professor emeritus at the Richard Ivey business school at Western and former board chair at the National Arts Centre in the nation’s capital, Leighton called the extent of financial reporting by the orchestra to its members “most unsatisfactory.” He described the orchestra as being “on the brink” and insisted on a more fulsome explanation of how it had incurred a $756,000 debt by the end of the 2008 fiscal year, as well as “a clear way forward.” He made a pointed demand for greater accountability and transparency.
That was January. In early May, after what would have been a full fiscal quarter, I contacted Joe Swan, the former city councillor retained by the orchestra to consult with and steer it toward financial viability. It was Swan who, at the annual meeting, had framed a rough outline of the new business plan: limit spending to a maximum of $3.5 million a year while raising a least $3.7 million annually. The effect would be to eliminate the orchestra’s “million-dollar problem” within five years.
In an emailed response to my May phone call, Swan declined to provide any information and said that all media inquiries were to be handled by board chair Brent Kelman.
A week later, Kelman appeared at London’s board of control to provide an update. He said the orchestra had “turned the corner” through higher revenues than the previous year and some successful fundraising. City finance chief Vic Cote, however, expressed concern over lagging subscription sales. Expenses were down, Cote said, but revenues continued to be an issue. He underlined the need to see improvement by June.
I called Kelman in late June and asked for an update, given the soft March numbers and the fact that the organization was only days away from ending its fiscal year. No figures were available, Kelman said, adding that he’d be away from the city off and on in the weeks ahead. He asked me to call back in mid-August, when all the data from fiscal 2009 would be in.
I called back on Aug. 14 and left a message. Kelman returned the call, saying he’d prefer to discuss the numbers when the auditors’ report became available. He suggested I check with him again in mid-September.
I knew I was being played (forgive the pun) but decided to go along. When I called last week, Kelman explained that the auditors still hadn’t signed off on their report. While I suggested that, auditors or no auditors, any organization worth its charitable status would know within days of its fiscal year-end roughly how it finished, Kelman remained unmoved. I argued that sitting on the numbers might be a effective public relations ploy, but that London taxpayers were now on the hook and deserved better. Kelman promised to bring my concern to the board’s meeting this past Monday.
He called back late Monday night. The board had backed his position, he said. No financial information would be released until the orchestra meets board of control again on Oct. 21.
All of which leaves Londoners in the dark and wondering about the wisdom of the 11th-hour credit arrangement. With Swan effectively gagged, Kelman not talking and the board of directors incommunicado (try locating their names on the orchestra’s website — the listing is now blank), it’s anyone’s guess as to what shade of red the organization currently finds itself. Even representatives of the players association are reluctant to comment.
Sources say the orchestra is stretching the outer limits of the half-million-dollar line of credit. Some say the board has committed to undertake yet another emergency fundraising campaign later this fall. One well-placed source says London taxpayers should be concerned. But we won’t know until Kelman and his board are compelled to reveal the truth, however it’s spun, at their mandated appearance before controllers in a couple of weeks.
So stay tuned. Two things, though, seem certain: Orchestra London’s accountability to its members remains questionable, and what should be transparent is as opaque as a brass cowbell.
LONDON FREE PRESS, January 31, 2009:
Orchestra London’s annual meeting was zipping along at allegro pace Thursday — it had already reached the “Other business” item just before adjournment — when retired Ivey business school professor David Leighton raised his hand and named the elephant in the room.
“I think we’re on the brink here . . . we’re not off the brink,” he said ever so politely, as befits an officer of the Order of Canada, before making the point that most supporters of the orchestra understand the depths of its financial problems, but haven’t a clue about just how its board sees a clear way forward.
“We are not informed of how you see the numbers coming out,” he said, adding the softening economy will make fiscal recovery all the more challenging. “Members need to know more . . . . We’re left in the dark about your future planning.”
Orchestra president Brent Kelman, who was presiding over the meeting and had made both direct and oblique references to the $756,000 debt the organization had accrued to the end of the 2008 fiscal year, tried to reassure the assembly of a mere 45 souls.
“You can take comfort in the fact that city administration is looking at . . .”
“I’m sorry,” Leighton interrupted, “I don’t take any comfort in the city administration taking a look at the figures.” (A gale of laughter swept the room.) “In a business, this would be a most unsatisfactory report to shareholders.”
Again Kelman tried to smooth over the problem. “We do have a plan. We would be happy to share that with you,” he said, attempting a second brush-past.
Leighton, however, was undeterred. City officials may have received a thorough briefing and detailed accounting of the orchestra’s financial troubles, but its members — those to whom the board owes its existence and a comprehensive report— had not.
“It was tabled to the city, but it wasn’t tabled to us,” Leighton said.
It was a critical point at the penultimate moment on the agenda, and it launched former city councillor-cum-consultant Joe Swan to his feet to provide, in considerably more detail, the business plan for the next five years: hold spending to $3.5 million annually, boost revenues to $3.7 million a year, and chip away at what, by the end of this season, will be a “million-dollar problem.”
In order to keep the board on task and improve the transparency of the recovery process, Swan said, chartered accountant Jim Dunlop will act as an “independent monitor,” assisted by an oversight committee consisting of Gino Francolini, Janet Stewart and Doug Alexander.
Earlier in the meeting, Kelman did, in his president’s report, make a public admission of past mistakes: “I want to apologize, on behalf of Orchestra London, for getting us into this situation, but we’re on a momentum curve now that will get us into a significantly better situation.” But it seemed he had hoped to leave the matter there.
Like a binge dieter who has tried numerous remedies to get fit but consumes too much comfort food, Orchestra London has suffered a narrowing of the communication arteries. Now, radical intervention is just about all that will save it. That process will necessarily include exercises designed to grow new marketing muscle, endure an austere financial regimen and, most importantly from a governance point of view, undergo an accountability angioplasty that will restore the flow of information to those who own it — its long-suffering musicians and supporters. They want to now what the “momentum curve” really looks like.
That process is scheduled to get underway over the next three weeks, when, with the assistance of The Lashbrook Group and Red Rhino Wildly Creative Communications, the orchestra will get off the examination table and take its first steps toward renewal.
“We’re not being given enough information — that’s what people are saying,” declared orchestra supporter Evelyn Bastow, picking up on Leighton’s theme, as Thursday’s gathering came to its close.
If Orchestra London does return to financial health and stability, it will do so only by bringing more Londoners into the non-musical aspects of its operations, not shutting them out.
And it should be remembered that, in the dying moments of a pro forma annual meeting, it was the challenge and temerity of a professor emeritus that helped turn the corner.
LONDON FREE PRESS, January 3, 2009:
The following are two paragraphs from a column I wrote for this newspaper in February of 2000:
“Yanked from the precipice of bankruptcy this week by a city loan of $110,000, Orchestra London’s staff and board are, once again, trying to come up with a plan to save the organization.
“This is already a very familiar tune. Over the years, Londoners have heard it so often they know it by heart. Like the theme from the motion picture Titanic, it was arresting and haunting the first few times; now it’s beginning to grate.”
Back in 2000, the orchestra was facing the prospect of an accumulated debt, by the end of its fiscal year, of $600,000, despite an annual grant from the city of $125,000.
Five years before that, in 1995, a disastrous season had lost $113,000 and cranked the debt up to $290,000 — a predicament that then-president Bruce Boundy attributed to failings on the “non-artistic” side of the orchestra’s operations. The organization went to the city for a $150,000 loan, got it and, within four years, had repaid it in full.
Less than a year later, however, the orchestra was back at the council table, asking for the $110,000 loan — which it got, the attached strings relating to new business plan.
The organization’s Y2K funding crunch taught city politicians two things: first, that Orchestra London would need dramatically more in public funding to build a sustainable business plan and, second, that the orchestra could be trusted to repay loans and get its financial house in order. In the years that followed, the city’s annual grant was ramped up to its current $460,000, while the orchestra did, once again, manage to repay its loan from the municipality.
Such is the recent history of London’s most mercurial arts institution. It was against this backdrop that ashen-faced city councillors last month looked yet again at a request for emergency funding from the orchestra to stave off bankruptcy. This time, it was an unprecedented $500,000 loan guarantee to prevent the orchestra’s financial collapse; the red ink, officials said, could run as deep as $900,000 within the coming six months.
The half-million-dollar sum was itself reason enough to cue the Trauermarsch from Mahler’s Fifth Symphony. But the gravity of the situation, mere weeks after council’s board of control had been given positive reports on the orchestra’s finances, raised questions about lack of transparency and even deception.
Against the recommendation of the city’s chief finance bureaucrat, council approved the guarantee by a 13-5 vote, taking as slight consolation a shakeup of the orchestra’s board and the departure of its executive director.
It was, as Mayor Anne Marie DeCicco-Best put it, “a leap of faith” that puts council in a very difficult position as it attempts to impose unvarnished austerity on city-related boards and commissions later this month in the face of the economic downturn.
Whether the orchestra can survive its latest “non-artistic” difficulties is still an open question, though past experience tells us not to count it out.
Orchestra London’s biggest challenges, however, are twofold. The first is financial; the second has to do with perception. The organization must find the monetary resources and the managerial acuity to finish the current season and plan for 2009-10. But it must also try to cast off nagging doubts among supporters, sponsors, employees and politicians about whether it is open, accountable and transparent enough to merit the trust and tax dollars of various levels of government and their granting agencies.
To the first, the answer is straightforward: It’s time for all music lovers in the city and surrounding region to vote with their wallets.
To the second, I’d propose a challenge, not only to Orchestra London but to all of the city’s major arts institutions: Follow the city’s lead on transparency. Post meeting dates, agendas, reports and minutes of meetings on your websites. Rather than regarding them solely as marketing tools, transform your websites into instruments of dialogue and accountability that are truly interactive. Engage the community with inclusion. Banish backroom secrecy.
With some creativity and a coordinated effort, London’s arts institutions could be transformed into the most transparent and responsive in the country.
