NEW FINDINGS ON NONPROFIT CEO PAY AND BOARD MEMBER GIVING
By Betsy Rosenblatt
Last year, the National Center for Nonprofit Boards and the Stanford University Graduate School of Business conducted a study of nonprofitboards. A few quick picks (the sample generally is of larger-than-typical nonprofits): The median board size is 17 members, of whom 86% areWhite/European, 9% African American, 3% Hispanic/Latino, and 1.5% are Asian. Thirty-eight percent of boards assess their own performance, and a remarkable 78% have a conflict-of-interest policy. Two of the bigges tissues-nonprofit CEO pay and board member financial contributions-are covered in more depth below.
The study gave substantial attention to two major issues-nonprofit CEO pay and board member financial contributions. The reported results may help launch a useful discussion at your board table on some critical and difficult money topics: "How much should we pay our chief executive? It's a demanding job, but we ARE a nonprofit. "Should we require all board members to make financial contributions? How much is appropriate? After all, we already give our time; should we have to give money as well?"
Remember, the survey numbers do NOT characterize the "right" answer. Your organization is unique and must decide based on its own values, goals, abilities, and culture.
CHIEF EXECUTIVE COMPENSATION
* Eighteen percent of nonprofit chief executives reported salaries of $100,000/year or more, an increase of 6% in the 1996 survey.
* In the new survey, the largest group of chief executives, 34 percent,reported salaries between $50,000 and $74,999.
* Annual salaries of under $50,000 were reported most often by chief executives of environmental organizations (48 percent), arts organizations (39 percent) and religion-related organizations (35 percent), and least often by chief executives of management support organizations (17 percent) and health organizations (18 percent).
* Chief executive salaries have a direct relationship with the organization's budget size, as well as the scope of the organization's activity. Local nonprofits report that 38 percent of their chief executives earn less than $50,000, while only 21 percent of national organizations and 23 percent of international organizations pay comparable salaries.
BOARD MEMBER GIVING
NCNB recommends that every board member gives-but gives according to his or her means. Not every board engages in this practice, however, and many boards ask that board members give a pre-determined amount.
* 88% of board member survey respondents indicated that they make annual personal financial contributions to their boards.
* 79% reported that they identify donors and/or solicit funds.
* 75% indicated that they attend fundraising events.
* 48% of nonprofit organizations in the survey require all board members to give financially.
* 36% of chief executive respondents indicated that their entire board makes annual personal contributions.
Original publication date: 02-22-2001
© 2001 CompassPoint Nonprofit Services/National Center for Nonprofit Boards