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ON THE BOARD CIRCUIT
POTENTIAL LEADERS EXCLUDE THEMSELVES-OR ARE EXCLUDED -FROM SOME OF THE AREA'S MOST INFLUENTIAL BOARDS OF DIRECTORS. THE RESULT: A SHALLOW POOL OF TALENT.

In a town that's nearly bereft of movers and shakers, no one moves quite like Luiz F. Kahl, chairman of the NFTA, or shakes like Robert T. Brady, chief executive of Moog Inc., and Thomas P. Hartnett, president of Blue Cross and Blue Shield.

If you look at the boards that run 30 of the Buffalo Niagara region's most influential institutions, you'll find either Kahl, Hartnett or Brady sitting on nearly half of them. Kahl serves on more of the boards -- seven -- than anyone else. Brady devotes time to six, as did Hartnett until he recently left one of them.

Talk to people involved in Buffalo's power elite, and they'll agree. The community needs more Kahls, more Hartnetts, more Bradys.

"We need more people who are willing to get involved for the benefit of the area," Kahl said. "You err by not including people."

The trouble is, potential leaders exclude themselves and are excluded.

A Buffalo News study of boards of directors found certain people and certain professions -- government, banking and law -- dominating the Buffalo Niagara region's power structure. Conspicuously missing were big-business types and entrepreneurs.

There are reasons for that pattern. Most importantly, Buffalo just doesn't have many big businesses or headquarters. Branch-office executives sometimes don't have the freedom to serve. And entrepreneurs are either too busy or feel left out by the old-boy network.

The result is a shallow talent pool running many of Buffalo's most important organizations.

"Eighty percent of them are the same people," said Colleen DiPirro, president of the Amherst Chamber of Commerce. "There isn't a diversity of opinion or a forum to develop a range of ideas."

There's a sameness to the boards that run everything from the Erie County Industrial Development Agency to the Buffalo Niagara Partnership to the Buffalo Philharmonic Orchestra -- the type of top-level civic organizations included in the boards study.

The News studied boards of directors because leadership experts say that's where the action is -- where decisions are made that can make or break an organization or, collectively, even a community.

For proof of that, look no further than Buffalo, or Cleveland.

In Buffalo, the board of the Philharmonic -- led by lawyer Robert M. Greene -- pulled the orchestra out of the red and led it to new heights under Music Director JoAnn Falletta.

And Cleveland Tomorrow, a group of the town's top business leaders, worked to land the Rock and Roll Hall of Fame and other projects that turned downtown into a tourist mecca.

Nothing of that scale has happened in Buffalo, and many wonder if it's because there aren't enough business leaders.

"There are too few leaders who will challenge the power elite," said Assemblyman Sam Hoyt, D-Buffalo.

Indeed, the study does seem to point to a shortage of talent.

A dozen people, led by Kahl, Hartnett and Brady, sit on at least four boards each. Typically, those people sit on the most powerful boards -- those of the Buffalo Niagara Partnership and the local banks and the most prominent civic institutions.

Who runs the town?

Well, maybe it's the Partnership. Members of the Partnership's board served on 21 of the 29 other major boards studied.

Then again, that could just reflect the fact that Buffalo's business leadership is spread very thin, said Andrew J. Rudnick, the Partnership's president.

"There aren't that many people to go around," Rudnick said. "We haven't had enough economic strength so that people could spend time away from their businesses to be corporate citizens."

In other metro areas, the executives with that time and inclination run the biggest companies -- those on the Fortune 500. But Buffalo has no such corporate giants.

For community leadership, the ramifications of that fact are immense. The Group of 18, an organization of top executives formed to set the agenda for change in the region, is proof of that, said David C. Perry, a former University at Buffalo planning professor who studied the group a decade ago.

The Group of 18 was Buffalo's attempt to follow the example of Cleveland Tomorrow, but there was one big difference.

The Cleveland's group had a rule: To join, you had to head a Cleveland-owned company and had to have the power to make decisions -- and spend money -- on behalf of the company.

Buffalo couldn't have that rule.

"Buffalo didn't have a lot of people left who could make decisions" without calling some faraway headquarters, said Perry, who now heads the Great Cities Institute at the University of Illinois at Chicago.

In a town that's so noticeably short of corporate powerhouses, the power falls to bureaucrats, bankers and lawyers.

While government employees occupy more board slots than any other profession, that's a little misleading.

If you don't count the 91 government workers on the Democratic and Republican political committees, then government workers hold 49 of the 645 slots on the remaining 28 boards. In other words, government workers are just about as influential on those other boards as bankers, lawyers and educators, the top three other professions in the board study.

Among local companies, M&T Bank employees hold the most board slots.

Despite M&T's activism, the boards study shows that the notion that the bank "runs the town" is largely myth. HSBC Bank has employees on 11 boards, just one fewer than M&T. And HSBC actually has more of its directors on the board of the Partnership than M&T does.

Several sources said the fact that bureaucrats, bankers and lawyers dominate Buffalo's boards probably makes a huge difference to the nature of Buffalo's leadership. Bankers, lawyers and bureaucrats are not noted for taking chances.

"Our leaders are very conservative," said James J. Allen, executive director of the Amherst Industrial Development Agency and high-ranking executive with the Erie County IDA. "If anything, they're risk-averse."

In addition, for a community where many major employers are based elsewhere, Buffalo's power elite is astonishingly local. About 82 percent of the 819 board slots were held by people who either work for Buffalo-based companies, are retired or don't work beyond their volunteer activities.

Another 10 percent are held by people who work for out-of-town operations with a regional headquarters in Buffalo.

Just a handful work for big manufacturing firms that employ thousands here, but have headquarters far away. Delphi Harrison Thermal Systems manager Ronald Pirtle occupies two board slots. A General Motors employee occupies one. Ford Motor Co. employees don't occupy any.

"This is pretty sad, but in Detroit, do they care?" asked Susan Warren Russ, who heads the Leadership Buffalo training program. "We've been going after GM and Ford for years to try to get them involved, but we've never been able to."

To some degree, there's a good explanation for that lack of involvement.

"How much management hierarchy do those companies have in Buffalo?" asked Dianne Bennett, president of the Hodgson, Russ law firm, which has more people serving on boards than most out-of-town manufacturers combined. "They may employ thousands, but not many are managers."

Kahl, chairman of the Niagara Frontier Transportation Authority, cited another reason. He noted that, when he ran the Carborundum Co. and wanted to serve on the LucasVarity and National Fuel Gas boards, he had to ask executives at the London headquarters of Carborundum's parent company, British Petroleum, for permission.

"These major companies view it as a diversion of your time," he said. "Some companies don't like their senior executives to serve on more than one or two boards."

Dan Greene, a GM spokesman, said The News' study is "very misleading." GM employees serve on a number of boards, he said, but not the ones The News studied. For example, GM's personnel director, Aubrey Scott, heads the Urban League of Buffalo board and also serves on the Buffalo Museum of Science board.

Buffalo's boards don't have much of a new-economy flair, either. Of the 819 board slots, five -- less 1 percent -- were held by people from emerging high-tech companies.

Business leaders say there are two reasons for that. For one thing, there aren't many high-tech ventures here.

And for the people who have started such companies, getting their businesses off the ground is the top priority.

"We're just too busy," said Jeff Belt, former president of the New Millennium Group, a civic activist organization for young professionals, and founder of a high-tech start-up.

Belt is planning to leave two of the three boards he serves on and has turned down requests to join other boards.

"I intend to start joining in seven years or so when I have a staff and a track record," he said.

Others, however, point out another reason entrepreneurs are not yet players on the community scene. The old guard isn't eager to let them in.

Mark Goldman seems to be proof of that. He has written two books on Buffalo history and, through his Calumet Arts Cafe and other ventures, almost single-handedly turned Chippewa Street into the centerpiece of downtown Buffalo nightlife.

Yet he has never been asked to serve on the board of a major community organization.

"I'm not part of the crowd," Goldman said.

The trouble is, the crowd is pretty small.

"I don't think we've developed bench strength. We haven't developed the next generation of leaders," said DiPirro, of the Amherst Chamber. "The fathers haven't let go of the reins of leadership."

Then again, the fathers are really only responding to calls from civic groups that need some help.

Executives such as Kahl, Hartnett and Brady are in such demand for several reasons. They're local. They're able to duck away from their day jobs to devote time to these other groups. And they're willing to do it.

"Today, my day job is the boards," Kahl said. "I get excited about these things."

But the demands can stretch the most active volunteers pretty thin. Brady, for example, frequently has to bounce back and forth between downtown board meetings and his company's Elma headquarters.

"It becomes a kind of hobby, and the players come to regard themselves as a team," Brady said. "As long as the players think there's real progress being made, I think there's a willingness to stay involved."

Yet relying on a small cadre of business leaders has its dangers.

"If you're asking the same folks to do everything, they're going to get burned out," said Thomas A. Kucharski, president of the Buffalo Niagara Enterprise business development group, who is about to begin double duty himself as head of the Erie County Industrial Development Agency.

Please send responses to this series to leadership@buffnews.com, including your name and telephone number. Reporters and editors will review the e-mails and plan possible follow-up stories based on your input.

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