Executive Pay

Obama.sff.standalone.prod_affiliate.101.jpgIf you read the news, you’ve probably seen the Obama administration’s plan to put a limit on executive pay for banks receiving TARP money. The cap of half a million dollars is tiny compared to some of the salaries major executives command, but all this public hew and cry over executive compensation for for-profit companies has gotten me thinking about how much a non-profit CEO can pull in.

Well, according to Charity Navigator, there are 93 executives for non-profits that clear more then $500,000 a year in pay. I’m curious to know if that sort of information is detrimental to your desire to give. For me, knowing that my donation might be paying into a microscopic amount of a CEO level salary is a determent.

When I was working as a public liaison in a large non-profit, I often got an earful about how much our CEO made. It wasn’t half a million, but it was a healthy six figure salary, and many donors felt that they had no reason to contribute to something if their hard earned dollars were going to make a wealth person wealthier.

I know that many CEOs are intelligent and creative people who make difficult and pressure filled decisions every day. I know that their ability to fund raise can mean the difference between a non-profit floundering and a non-profit surviving and expanding. However, as the economy continues to have trouble pulling out of it’s current tailspin, I would imagine that people who give are going to want to guarantee that their money goes straight to the source.

Perhaps there is space here, especially given the weight of the economic crisis, for oversight from donors in the same way "Say-on-Pay" has been suggested to create oversight in for profit stations. Or, perhaps this is a bee in my personal bonnet, and executive pay is less of a concern for high net worth donors.

Alan Smith

Posted at 1:00 AM, Feb 13, 2009 in Accountability | High Net Worth Donors | Philanthropic Strategy | Permalink