EA - The FTX crisis highlights a deeper cultural problem within EA - we don't sufficiently value good governance by Fods12

Link to original articleWelcome to The Nonlinear Library, where we use Text-to-Speech software to convert the best writing from the Rationalist and EA communities into audio. This is: The FTX crisis highlights a deeper cultural problem within EA - we don't sufficiently value good governance, published by Fods12 on November 14, 2022 on The Effective Altruism Forum.IntroductionIn this piece, I will explain why I don't think the collapse of FTX and resulting fallout for Future Fund and EA community in general is a one-off or 'black swan' event as some have argued on this forum. Rather, I think that what happened was part of a broader pattern of failures and oversights that have been persistent within EA and EA-adjacent organisations since the beginning of the movement.As a disclaimer, I do not have any inside knowledge or special expertise about FTX or any of the other organisations I will mention in this post. I speak simply as a long-standing and concerned member of the EA community.Weak Norms of GovernanceThe essential point I want to make in this post is that the EA community has not been very successful in fostering norms of transparency, accountability, and institutionalisation of decision-making. Many EA organisations began as ad hoc collections of like-minded individuals with very ambitions goals but relatively little career experience. This has often led to inadequate organisational structures and procedures being established for proper management of personal, financial oversight, external auditing, or accountability to stakeholders. Let me illustrate my point with some major examples I am aware of from EA and EA-adjacent organisations:Weak governance structures and financial oversight at the Singularity Institute, leading to the theft of over $100,000 in 2009.Inadequate record keeping, rapid executive turnover, and insufficient board oversight at the Centre for Effective Altruism over the period 2016-2019.Inadequate financial record keeping at 80,000 Hours during 2018.Insufficient oversight, unhealthy power dynamics, and other harmful practices reported at MIRI/CFAR during 2015-2017.Similar problems reported at the EA-adjacent organisation Leverage Research during 2017-2019.'Loose norms around board of directors and conflicts of interests between funding orgs and grantees' at FTX and the Future Fund from 2021-2022.While these specific issues are somewhat diverse, I think what they have in common is an insufficient emphasis on principles of good organisational governance. This ranges from the most basic such as clear objectives and good record keeping, to more complex issues such as external auditing, good systems of accountability, transparency of the organisation to its stakeholders, avoiding conflicts of interest, and ensuring that systems exist to protect participants in asymmetric power relationships. I believe that these aspects of good governance and robust institution building have not been very highly valued in the broader EA community. In my experience, EAs like to talk about philosophy, outreach, career choice, and other nerdy stuff. Discussing best practise of organisational governance and systems of accountability doesn't seem very high status or 'sexy' in the EA space.There has been some discussion of such issues on this forum (e.g. this thoughtful post), but overall EA culture seems to have failed to properly absorb these lessons.EA projects are often run by small groups of young idealistic people who have similar educational and social backgrounds, who often socialise together, and (in many cases) participate in romantic relationships with one another - The case of Sam Bankman-Fried and Caroline Ellison is certainly not the only such example in the EA community. The EA culture seems to be heavily influenced by start-up culture and entrepreneurialism, with a focus on moving quickly and relying on finding highly-skilled and highly-aligned people and then providing them funding and space to work with minimal oversi...