50 shades of greed: Sierra Club and Non-profit Cronyism

I often find myself an anachronism within the Beltway – a modern day libertarian/conservative who cares for the environment. However, I have always wondered why there is an absence of balanced approach by environmental groups. While advocating for their goals, there never seems to be a comprehensive push for true clean energy by these activists.

But then recently I came across E&E Legal’s report , which tells the tale of the unfettered bias and influence hedge fund managers have with respect to Sierra Club’s Board, the direction of its Policy Programs, and its research and outright manipulation of grassroots membership. It is appalling and worthy of an investigation by the IRS, the SEC and any other Federal agency with legal oversight.

For example, E&E was able to uncover that nearly half of Sierra Clubs’ 18 Board Members were or still are in a position to financially profit from the single largest policy effort undertaken by the Club. Board members regularly received private notice of Sierra Club actions before the public. Companies owned, founded or operated by Board Members held strategic market investments which directly benefitted from public announcements of Sierra Club reports, policy campaigns, and even testimony before local, state and federal governmental entities.

The staggering part is that there is no public admission of this inherent conflict of interest anywhere on the Sierra Club publications, or their Board’s public information. No where does Sierra Club disclose the direct and material benefit that Sierra Club’s Board Members gained for their positions of influence which the Board Membership granted them.

The level to which this “environmental cronyism” has benefitted Board members of Sierra Club would require a multi-year investigation of economists and attorneys practiced in the details of investment markets. Such questionable tactics have only been matched recently by the well-documented misuse of Federal grant dollars to companies such as Solyndra, the bankrupt Obama White House funded “green energy startup” whose only success was to pay off investors with more than half a billion of taxpayer dollars.

When the Sierra Club manipulates its membership to aggressively advocate against certain types of power plants, the Club has an obligation to reveal the investment strategy its Board Members have. It doesn’t matter whether its a short sale of the power companies whose plants are the target of the grassroots lobbying campaign or some other complex investment plan that is only an option for a massive hedge fund.

All of that aside, it’s obvious nearly half of the Board of Sierra Club only funds the Club’s operations and its policy campaigns as an investment strategy. Apparently they are simply hypocrites cloaking themselves as caring for the environment, yet taking in massive profits fueled on tax dollars.

Its not simply “predictable” or a “shame”. This must be contrary to the IRS rules governing the benefits garnered by a Board Member of the non-profit and the guidelines governing the ability of a 501c3 entity to receive non-profit status. The Oversight and Investigations Counsels of both the House Ways and Means Committee and the Senate Finance Committee should review the particulars of this troubling state of affairs.