Tuesday, March 27, 2012

Financial Transparency & The LDS Church



by Seattle Jon (bio)

As monthly contributors to the Open Stories Foundation (mormon-related podcasts), my wife and I recently received a donor letter for our tax return. The stated purposes of the letter were:

1) To provide an end-of-year donation report,
2) To review what Open Stories was able to accomplish during the year, and
3) To let donors know some of what was ahead.

The summary of the foundation’s accomplishments and preview of what was ahead were nice, but what really caught my eye was the report on the foundation’s finances, including a profit and loss statement and a balance sheet. I have to say, the financial transparency was refreshing.

For years, I've been sending tithing directly to The Corporation of the President of the Church of Jesus Christ of Latter-day Saints (the corporation that receives and manages money and church donations) and declining the annual tithing settlement in silent protest of the lack of financial transparency in the church. I’m not trying to start a movement or anything, it’s just that I've spent my entire career in the financial services industry and I think transparency is good business … and good religion.

Any sizable charity (i.e. Red Cross, United Way) and some religions (i.e. Seventh–Day Adventists, Catholics) work toward full disclosure of contributions and policies used to distribute those contributions. Why not our church?

One reason might be that members of The Church of Jesus Christ of Latter-day Saints have a long history of faithful adherence and unquestioning obedience to the church as an institution. A majority of church members seem fine with the church’s internal audit department providing certification at each annual general conference that contributions are collected and spent in accordance with church policy. A majority of the uses of funds – construction and maintenance of facilities, social welfare and relief, the missionary program, church universities and scouting – seem clear enough, but other uses of funds leave me scratching my head (City Creek Center cost how much?!). The question, then, is how much longer will church membership be okay with not having a clear sense of what “church policy” is?

Here are a few reasons why the church might want to be more financially transparent, followed by a few reasons why they might want to avoid increased transparency.

Reasons For Transparency
●  “But he that doeth truth cometh to the light, that his deeds may be made manifest, that they are wrought in God.” – John 3:21
●  The church released a detailed financial report at April general conferences from 1915 to 1959
●  One could argue that donations might increase with full disclosure of church policies and clearly articulated reasoning around major expenditures
●  United States law might eventually require disclosure (Canada and the UK already have such laws)

Reasons Against Transparency
●  Transparency is not faith-promoting
●  Majority of church members seem fine with limited accountability
●  Full disclosure would increase scrutiny and accountability, and possibly lawsuits against the church
●  Financially secure and wealthy church might discourage generous member tithes
●  Gives members freedom from the world of business allowing them to focus on the gospel

In summary, desiring transparency is not the same as distrusting the current way of doing things, it’s about preventing personal agendas from circumventing God's agenda. I take President Hinckley at his word when he said the “information belongs to those who made the contribution … .” Is increased financial transparency and greater clarity around church distribution policies asking too much?

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