Specifically,  these reports highlighted:  inadequate policies in place and insufficient oversight of and knowledge  among regents concerning executive compensation, trust and federal pay  systems, leave for senior executives, conflicts of interest regarding service  on for-profit boards, travel expenses, event expenses, activities of SBV,  and internal financial controls;   a lack of critical information and relationships necessary to bring forward  important issues and concerns and to support vigorous deliberation and  well-reasoned decision making on the part of the Board, such as lack of  access for senior management to the Board, too much control within the  Secretary’s office regarding the information available to the Board and the  Board’s agenda, and a lack of transparency and connection to  stakeholders within the Smithsonian (such as museum directors and  advisory boards) and to the public at large; and IRC’s finding that there was insufficient action on the part of the Board to  demand critical information needed to conduct adequate oversight of the  Smithsonian, which was linked to a number of issues, such as unclear  roles and expectations for citizen, congressional, and ex-officio regents; a  lack of engagement and participation by some regents; unclear  responsibilities of Board committees and a lack of critical committees; a  lack of diversity of skills and expertise needed to conduct adequate  oversight; inflexible size and structure of the Board; and a lack of  accountability of regents with regard to their performance and to fulfilling  their fiduciary duties. Board Has Implemented Some Executive and Ethics Reforms, and Has Begun a Review of Policies and Internal Controls, but Implementation Challenges Remain

The Board has implemented several executive reforms to address  concerns about executive compensation, benefits, and expenses, and has  established an overarching code of ethics applicable to everyone  associated with the Smithsonian, but development of policies and internal  controls for broader operational matters such as travel, event expenses,  and contracting is still under way. Implementation of New Policies and Procedures Will Be Challenging

Effectively implementing the new policies and procedures developed  during these review efforts is likely to depend on effectively training  Smithsonian staff at all levels and on effectively establishing  accountability, both of which may be challenging for the Smithsonian. Board Has Implemented Reforms to Improve Information and Transparency; Efforts to Enhance Communication Are Not Fully Implemented

The Board has completed the actions it proposed for improving its access  to information and making its operations more transparent, but actions to  improve communication and relationships with stakeholders are not fully  implemented. However, the team  has taken a number of steps thus far. Board Has Taken Actions to Clarify Roles and Responsibilities and Studied Possible Changes in Its Composition, but Establishing Accountability Remains a Challenge

The Board has largely completed the actions it proposed for clarifying  regents’ responsibilities and studying possible changes in its size and  structure, but actions for assessing Board performance are still being  developed. The Board has not yet developed a process for assuring  transparency and accountability in selecting nonregents and using them to  enhance governance. The Board is developing a self-assessment process to  examine its performance, but it is not clear how the Board will hold  regents accountable in the event of performance problems. The Board  does not currently have plans to conduct a broader evaluation of its  governance reform efforts after a suitable period of implementation to  determine if they have been effective in addressing the governance and  accountability breakdowns that occurred. Given the  extent and pace of changes occurring at the Smithsonian, as well as other  transformations of the institution, including the hiring of a new Secretary  and significant reforms to SBV, among other things, it is likely that many  governance reforms will not be completely implemented for some time,  and the effectiveness of some reforms will only be evident over a longer  period of implementation. To assess the Board’s efforts at  improving communication with other stakeholders, we reviewed GAO’s  work on federal agency communication strategies.
Why GAO Did This Study

The Smithsonian Institution's governing body, the Board of Regents (Board), has developed a set of actions to address governance and accountability breakdowns that came to light in 2007. These actions were aimed at problems in three main areas: (1) executive compensation, benefits, ethics, and operational policies and controls; (2) flow of information to the Board, transparency of Board operations, and relationship with stakeholders; and (3) the Board's responsibilities, structure, and performance. GAO was asked to assess the extent of the Board's progress in each of these areas. GAO obtained information and data from the Board's regents, Smithsonian executives, and other stakeholders and also analyzed other organizations whose boards had faced similar governance challenges.

What GAO Found

The Board has implemented several reforms related to executive compensation and benefits, but the development of policies for broader operational matters such as travel, event expenses, and contracting is still under way. Actions implemented include a revised salary range for the Smithsonian's Secretary-elect and a unified compensation policy for other executives. The Smithsonian is reviewing policies related to travel and other matters, including internal controls. Effectively implementing the new policies and procedures developed during these reviews is likely to depend on effectively training staff and establishing accountability, both of which may be challenging due to a level of standardization and requirements that did not exist before. The Board has completed the actions it proposed for improving its access to information and making its operations more transparent, but actions to improve communication and relationships with stakeholders are less far along. The Board now has avenues for obtaining information directly from senior officials rather than through the Office of the Secretary, and it has taken such steps as creating a Web page to better publicize its operations and decisions. The Board is studying how to improve links with its 30 advisory boards and has developed an overall strategy for communicating with the larger network of stakeholders, but neither action is far enough along to assess its potential for addressing past problems. The Board has largely completed the actions it proposed for clarifying regents' responsibilities and studying possible changes in its size and structure, but actions for assessing Board performance are still being developed. The Board altered its committee structure but decided that more fundamental changes in its size and composition were unnecessary. To provide further expertise where necessary under the existing structure, the Board is encouraging the addition of nonregents to committees. Thus far, however, the Board has not developed a process for assuring transparency and accountability in selecting nonregents and using them to enhance governance. The Board is also developing a self-assessment process, but it remains to be seen how the Board will hold regents accountable if they neglect their duties. Given the extensiveness of actions taken and still under way, it is likely that the effectiveness of some changes will only be evident over a longer time. The Board does not currently have plans to conduct a broader evaluation of its governance reform actions after such time has passed to determine if the actions taken have addressed governance and accountability problems which led to its reform actions.