Over late summer and early fall 2021, the Executive Committee (EC) of the Southern Baptist Convention (SBC) deliberated whether or not to waive attorney-client privilege (ACP) as part of a sexual abuse investigation into the actions of the EC over the past two decades, an investigation overwhelmingly demanded by the messengers to the 2021 SBC Annual Meeting. As the deliberations drew out, with resistance from some on the EC who were not willing to waive ACP, all kinds of commentary were offered to explain what was happening. As is readily apparent from this statement, some within the SBC argued that opposition to waiving ACP constituted nothing less than an attempt to deny the will of the SBC messengers who resoundingly approved the sexual abuse motion while those opposed to waiving ACP argued that the EC had a fiduciary responsibility to prevent risking “unnecessary damage to the Southern Baptist Convention” and its assets, such as insurance.
As the deliberations wore on, a two-part question kept coming back to me: What exactly is the relationship between the SBC and EC, and how does that relationship inform the waiver of ACP question? So, I dug into the SBC Bylaws, the EC’s Articles of Incorporation, and other documents written over 15 years ago by long-time SBC legal counsel, Jim Guenther (whose firm resigned its 55-year position as SBC counsel over the EC’s decision to waive ACP).
THE RELATIONSHIP: A COMMITTEE-CORPORATION FOUNDED ON RESPECTFUL LOYALTY
The relationship between the SBC and the EC is one of the most unique relationships in SBC life. To understand the relationship, one must realize that the EC is both a corporation and a committee.
A Unique Corporation
There are many legal corporations within the SBC family that are recognized by various governments. All six SBC seminaries are corporations registered in their respective states. The Ethics and Religious Liberty Commission is a corporation registered in Tennessee. The International Mission Board and the North American Mission Board…both corporations registered in Virginia and Georgia, respectively. The SBC itself is a corporation registered in Georgia. Likewise, the EC is a corporation registered in Tennessee.
What makes the EC a unique corporation in SBC life is that it is a committee, not an entity such as a seminary institution, mission board, or commission. Specifically, the EC is a standing committee (like the Committee on Committees, Nominating Committee, Resolutions Committee, Committee on Order of Business, etc.), the scope of whose fiduciary, fiscal, executive, and ad interim responsibilities are clearly laid out in SBC bylaw 18. (summarized here by Mr. Guenther).
Being a committee, the SBC has the authority to expand or contract the scope of the EC’s responsibility by bylaw change (if said responsibility is presently found in the SBC bylaws) or by motion (if said responsibility is not found in the SBC bylaws). No other corporations (the entities) relate to the SBC in this way; none of their responsibilities are laid out in the SBC bylaws for the SBC to so easily amend.
A Unique Committee
On the other hand, what makes the EC a unique committee is that it is a corporation which relates to the SBC via sole membership governance. No other SBC committee is a unique corporation recognized by governments within the United States. No other SBC committee relates to the SBC via sole membership.
As the sole member of the EC, the SBC possesses limited governing authority over the EC. The EC Articles of Incorporation state that the SBC possesses the following rights: the right to appoint trustees; the right to remove trustees; the right to amend the EC’s articles of incorporation; the right to approve any merger of the EC; the right to approve any sale, lease, or exchange of property of the EC; and the right to dissolve the EC. Importantly, all other governance and management responsibilities of the EC are reserved for the EC trustees.
What this means is that the SBC does not have full authority over the work of the EC. To paraphrase what Mr. Guenther helpfully says here, the SBC can set the scope of the EC’s assignment as a committee via changes to SBC Bylaws and motions, but only the EC can determine how it will carry out its assigned work as a sole member corporation.
Furthermore, what undergirds the SBC-EC relationship is respectful loyalty. According to Guenther here,
The Executive Committee has a duty to the Convention and its messengers to exercise its ad interim authority, and its fiduciary, fiscal, and executive functions, with prudence, care, and diligence and with absolute loyalty to the Convention. The messengers may hold the Executive Committee accountable for its lack of vigor and care.
At the same time, the Executive Committee must not act in a manner which is disrespectful of the messengers as the ultimate authority in the Convention. It must not “get ahead” of the messengers, establishing policies, programs, and ministries which are fundamentally within the province of the messengers. The Convention, acting through the messengers, points the way, and the Executive Committee assists in moving the Convention, the entities, and itself in the direction the messengers have pointed.
The EC is to be absolutely loyal to the SBC and it must not act in a manner which is disrespectful of the messengers as the ultimate authority in the Convention. The idea is that the corporations are to voluntarily move in the direction the SBC proposes—even within the sole member relationship where governance is uniquely delegated between the SBC and corporation trustees—because the will of each corporation’s trustees is to be respectfully loyal to the will of the SBC.
REGARDING THE ACP QUESTION
After reflecting on the EC’s deliberations, which concluded with a waiver of ACP, here’s how I believe SBC-EC relationship comes to bear on the ACP discussion.
The EC has the legal right to waive or not to waive attorney-client privileges under sole membership. The SBC can (and did) ask the EC to be a part of the investigation and can (and did) even request the EC to waive privilege, but the management of the entity within the investigation (such as the decision to waive privilege) is legally relegated to the EC trustees under sole membership. Remember, any governance not specifically delegated to the SBC in the EC Articles of Incorporation belongs to the EC trustees.
From a sole member perspective, the SBC did not violate the EC’s rights because the SBC properly left the ACP internal operating decision to the EC for acceptance or rejection. Conversely, the EC’s hesitation on the privilege question did not reject the SBC’s sole member authority because the SBC does not (in my opinion) have authority in this matter of governance/internal operation. In fact, for the SBC to possess such governing authority over internal operations risks the SBC creating ascending liability between itself and the EC for rogue actions of the EC.
At the end of the day, the SBC requested that the EC waive privilege and the EC trustees voted to waive privilege, all of which upheld both SBC autonomy and EC trustee autonomy in the sole member relationship.
SBC Bylaws & Fiduciary Responsibility – Committee
“O.K. That’s sole membership,” you say, “But what about EC fiduciary responsibility established by the SBC under SBC Bylaw 18.E? Does the EC have a fiduciary responsibility to minimize “unnecessary damage” to the SBC’s assets (property, money, insurance, etc.) at all costs, even if the SBC puts its assets at risk?”
Jim Guenther, again, is helpful. Commenting specifically on the fiduciary responsibility of the EC, he states that the EC can legally take title to SBC assets and hold them “subject to the direction, general or specific, of the Convention.” In other words, if the SBC takes an action or moves in a direction that would expose any or all of its assets to liability, the fiduciary responsibility of the EC is to follow the direction of the SBC. Importantly, though the EC may hold and disburse SBC assets, the SBC is the arbiter of how said assets are used.
The fiduciary argument that the EC must preserve SBC assets from “unnecessary damages” perceived by the EC was problematic. The argument opposed the SBC’s autonomy to use (including to potentially risk through waiver of ACP) its assets however it best saw fit to accomplish its Gospel mission. Furthermore, the argument placed ultimate oversight and control of SBC assets in the hands of a ruling oligarchy known as the EC, which threatened the SBC’s bottom-up, messenger-led polity. Thus, the fiduciary argument for not waiving privilege not only repudiated the EC’s fiduciary responsibility under SBC Bylaw 18.E, it did so at the expense of both the SBC’s autonomy over its assets and the SBC’s polity.
While it is not unreasonable for EC trustees to question whether or not an action of the SBC would cause actual or perceived loss to SBC assets, the appropriate time for such questions was during the SBC annual meeting when the motion was debated. But once the SBC voted and moved on the sexual abuse task force motion, the proper fiduciary response of the EC was to so move.
What was unique in this ACP matter was that the fundamental trust, respect, and loyalty between the SBC and its corporations—which makes our cooperation work beyond a purely legal sense—was being eroded as the EC repeatedly failed to move in the direction set by the SBC.
It was precisely for unfortunate moments like this that sole membership was adopted in the first place. The breaking of loyal trust between the SBC and the EC trustees is grounds for the SBC to use its sole member rights against current EC trustees to legally restore the broken trust. As Mr. Guenther stated above, “The messengers may hold the Executive Committee accountable” when absolute loyalty is not demonstrated.
Ultimately, the EC chose to move in line with the SBC. Even so, turmoil inside the EC ensued as Ronnie Floyd and Greg Addison resigned as President & CEO and as Executive Vice President of the EC, respectively, joining many EC trustees and the aforementioned legal counsel.
Nevertheless, the SBC has the autonomous right to remove any current EC trustee(s) it believes it cannot trust to carry out the will of the Convention at its next annual meeting in Anaheim and replace said trustee(s) with those who will carry out the will of the Convention. The SBC can also amend SBC Bylaws to reign in the scope of the EC’s work. The SBC can even alter the Cooperative Program funds designated to the EC if it perceives loyalty is lacking. Jay Adkins mentions the first two possibilities, and more, as options for the SBC to exercise come the 2022 SBC Annual Meeting.
The SBC-EC relationship is indeed a complex and unique relationship in SBC life with all of its nuances coming to bear on the question of whether or not the EC should waive ACP. I, for one, am thankful that the EC ultimately waived ACP and moved in the direction the SBC established during its 2021 Annual Meeting. It is my hope that this piece will help those of us in the SBC better understand the SBC-EC relationship so that we might have proper expectations of the roles and responsibilities that each possesses within our convention of churches as we ultimately aim to reach the world with the Good News of Jesus Christ.