Update on the Efforts to Achieve Financial Transparency in SBC Entities
As the Executive Committee of the Southern Baptist Convention (SBC) prepares for its spring meeting February 19-20 in Nashville, TN, a public debate is brewing around the perennial issues of financial disclosure and transparency in Southern Baptist life. This discourse has been catalyzed by Rhett Burns, Pastor of First Baptist Church of Travelers Rest, South Carolina, who will be presenting to the Executive Committee to make his case for enhanced financial accountability measures. Social media fireworks have already begun around the topic, with leading SBC Executive Committee members and staff asserting – to significant pushback – that the SBC already provides ample financial disclosure. For long-laboring transparency advocates, patience is wearing thin and the more that the SBC fights disclosure tooth and nail, the more reasonable suspicions arise about why SBC leadership is so stridently opposed to disclosure.
By some counts, the SBC and its various entities handle approximately $500 million in cash each year. These entities are often run by pastors with minimal corporate or financial training, and overseen by 40-50 trustees – far too large to function as meaningful accountability measures. Moreover, as many of the trustees are themselves leaders or employers of other SBC entities, they have strong incentives to play nicely and not rock the boat by asking hard questions.
Given this background, it is no surprise that financial transparency has become a serious flashpoint in the SBC in recent years. The North American Mission Board (NAMB), with its reported $430 million in assets, has been one of the primary targets of concern in the SBC. The entity has reportedly marginalized state conventions from participation in the church planting process, even while facing protracted litigation, increased scrutiny over its increasingly dismal church planting record, its support for churches with women pastors, and its funding NAMB church planter travel to the annual meeting to support the agenda of the SBC’s leftward flank.
In successive conventions in Nashville (2021) and Anaheim (2022), grassroots efforts to call for a forensic audit of NAMB failed despite majority support from the floor, being ruled out of order by parliamentarians – a decision that is both questionable as a matter of procedure, but also unappealable. The repeated quashing of the majority of the messengers has raised reasonable doubts about the integrity of the process and whether the churches that sustain the SBC with their giving have meaningful say over its direction.
In 2023, the Southwestern Baptist Theological Seminary (SWBTS) became yet another rallying cry for financial transparency after reports in the wake of former President Greenway’s 2023 resignation revealed that the mainstay seminary had racked up over $140 million in deficit spending since 2000.
With growing public demand for financial transparency, accountability advocates have shifted their approach in order to avoid the procedural roadblocks that have stymied previous efforts. At the 2023 Annual Meeting of the SBC in New Orleans, Pastor Burns brought forward the following motion:
“I move that THE BUSINESS AND FINANCIAL PLAN BE AMENDED AS FOLLOWS: Financial Reports, Paragraph 3 be added, to state: In addition to the foregoing, within six months of the close of each financial year, each Entity will publish information in the same detail, scope, and quality as would be required to be disclosed to the public in the informational Return of Organization Exempt From Income Tax, or Form 990, and all applicable schedules and attachments thereto, as if the Entity were required to file such return. An officer of the entity must attest that the information is true, accurate, and complete to the best of its knowledge. Unless otherwise provided, the Entity will use the definitions applicable by law, as if the entity were required to file the return. This does not require any Entity to file a 990 with the IRS or to disclose information that is not normally available to the public, such as Schedule B.”
The “990” is a form that is generally required of non-profits by the IRS. It is made publicly available and includes information such as summary financial statements, a balance sheet, salaries of top-five most compensated employees, a listing of top-five independent contractors, sources of support and other pertinent financial information. Churches and “church-related organizations” are generally exempted from the requirement to file Form 990s. The SBC executive committee and also its entities – including NAMB, IMB, the ERLC and its six seminaries – rely on the church-related organization exemption and do not file Form 990s. To be clear, Pastor Burn’s motion would not require these entities to file Form 990s, but rather provide a comparable level of public disclosure to SBC churches, for purposes of transparency, accountability, and trust
Arguments against Pastor Burn’s motion, so far, have failed to persuade accountability advocates. One argument that’s arisen is that requiring 990-level disclosure would impose serious resource drains and costs on the entities. But this objection fails the smell test: since each SBC entity has audited financials prepared each year for internal purposes, 990-level disclosure would be an extremely marginal additional effort – largely automated and drawn from readily accessible information that has already been prepared by the accounting firm. Moreover, since a wide array of very small and modestly resourced non-profits across the country comply with 990 requirements each year (including, e.g., small Christian colleges), the idea that 990-level disclosure would be an imposition on the much more amply resourced SBC entities is an argument that is difficult to make with a straight face.
SBC leaders have also objected to making salaries public out of a desire to protect personal or confidential information. This argument too seems unlikely to convince, since most of the pastors who comprise the SBC have their salaries made known to the people who pay their salaries during budgetary approvals processes. Similarly, anyone who works with a normal non-profit, a small college or even the c-suite of public companies has their compensation information known to the world.
SBC leaders will likely also argue that much of the sought-after information is already available. For example, Jonathan Howe took to X/Twitter earlier this week to announce that the 2024 Ministry Reports of the SBC entities had been made public, claiming that the reports “provide transparent insight” so that Southern Baptists would “intimately know the details of our national ministries.” But of course, the ministry reports are the functional equivalent of annual reports, and primarily marketing materials. The contents of these ministry reports focus on successes and some operational initiatives, but don’t come anywhere close to providing 990-level disclosure. Some limited information is accessible in other locations – for example, SBC seminaries report some data that is published by their accreditor Association of Theological Schools. SBC entities also provide very top-line financial results to the Evangelical Council for Financial Accountability. SBC entities are currently required to provide salary scales to messengers upon request, but the process is opaque and not consistently followed.
There may well be some legitimate concerns around revealing the name of IMB workers in foreign/restricted countries. Although it is highly unlikely that such individuals would fall into the top-five compensated employees, any such concern could be easily handled with a minor amendment to Pastor Burn’s amendment that would allow IMB to redact the names of any employees who would be reported if such a report would endanger their missionary work. This narrow concern is legitimate, but hardly a reason to scrap the entire transparency project.
Lawyers and other advisors may very well oppose Pastor Burns’ motion, claiming that additional reporting obligations create additional risk for the entities, since the entities would be required to attest to the accuracy of such reports. Such a perspective suffers from a very short-term focus. While it is true that heightened reporting creates the potential for an SBC entity to get it wrong, this perspective completely misreads the temperature of the convention at large. Given the longstanding pressure from the majority of the messengers for financial transparency, and the lack of good faith arguments against making heightened disclosure, it seems likely the SBC will continue to face a crisis of confidence (and decreasing cooperative program giving) until it opens up the books for the faithful that keep it funded.
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While I agree that there is a significant issue with transparency and accountability in the SBC, there is an erroneous statement in this article.
Those who comprise the trustee boards for the entities are not, in fact, majority comprised of those who are “leaders or employers of SBC entities.” Most of the trustee boards have representation from each of the state / regional conventions. Most are like me – pastors of churches or lay people in churches who have been nominated to serve.