You get what you pay for,whether you pay or not.
I am in agreement with Mark Kramer’s argument that “it makes economic sense” to adequately compensate an effective CEO, or board member, as the case may be.
While Pablo Eisenberg, the article’s antagonist, opposes compensation of foundation CEOs in the interest of the foundation’s clients, he fails to account for the larger context of the foundation’s effectiveness. The simple decision to increase grant size or distribution does not, alone, help the organization carry out its mission. If that mission is simple, let’s say “feeding the homeless,” then it is silly to waste a salary on a CEO who simply must decide whether a given charity does or does not feed the homeless. However, if the foundation’s mission is more complex – ending hunger – then that CEO must invest the appropriate amount of time to determine whether a given organization is impacting that mission, with what results, and in what relationship to other organizations working towards the same ends. Any of us could do the work of the first CEO at the end of our 8-hour workday and without compensation. Conversely, we would be hard-put to play the role of the second CEO unless we were in the position to forego the 8-hour workday, working instead for our foundation.
One cannot end hunger, though, simply by feeding the homeless; one must approach the greater issue of hunger. In much the same way, housing subsidies alone cannot work without accompanying efforts towards community development.
While I am not arguing that all board members or foundation CEOs should be compensated, I believe that the decision to compensate must be made within the context in which the organization operates. If someone must work full time to ensure the completion of the mission, that person must be compensated for his or her efforts. Moreover, if your organization needs someone of true CEO caliber, then the organization must pay a true CEO salary.
While Pablo Eisenberg, the article’s antagonist, opposes compensation of foundation CEOs in the interest of the foundation’s clients, he fails to account for the larger context of the foundation’s effectiveness. The simple decision to increase grant size or distribution does not, alone, help the organization carry out its mission. If that mission is simple, let’s say “feeding the homeless,” then it is silly to waste a salary on a CEO who simply must decide whether a given charity does or does not feed the homeless. However, if the foundation’s mission is more complex – ending hunger – then that CEO must invest the appropriate amount of time to determine whether a given organization is impacting that mission, with what results, and in what relationship to other organizations working towards the same ends. Any of us could do the work of the first CEO at the end of our 8-hour workday and without compensation. Conversely, we would be hard-put to play the role of the second CEO unless we were in the position to forego the 8-hour workday, working instead for our foundation.
One cannot end hunger, though, simply by feeding the homeless; one must approach the greater issue of hunger. In much the same way, housing subsidies alone cannot work without accompanying efforts towards community development.
While I am not arguing that all board members or foundation CEOs should be compensated, I believe that the decision to compensate must be made within the context in which the organization operates. If someone must work full time to ensure the completion of the mission, that person must be compensated for his or her efforts. Moreover, if your organization needs someone of true CEO caliber, then the organization must pay a true CEO salary.
posted by Anonymous @ 12:28 AM
1 Comments:
At 3:58 PM, October 02, 2006,
Paul Jonas said…
I do think that in certain circumstances, compensation is good. But, like Candice said, it makes a difference what league the non-profit organization is in. You're not going to be able to pay a major league salary in the minors. A majority of non profits play in the minors.
This posting brings be back to the nature of non-profit work, whether it is expected that you contribute more for less because it is a mission and not a bottom line.
Austin in another post lined it up best. It depends. It depends on what you use the members of the board for. If you're going compensate the board, and give the CEO a reasonable salary, why not hire a better CEO for a little more and save all the money on paying the board. Expect that CEO to do more with less.
Again, though. I think that often it is the case that NPOs hold an expectation that their internal publics give a little more, do more with less and adhere more stringently to the organization's mission. It has been the focus of NPOs for a long time and is nearly built into their structure, which may explain why there is so much tension over NPOs that are switching over to a more business-like model of organization.
I agree with many of the bloggers here and the authors in general, that sometimes board members rightfully deserve compensation, even without expectation, but the next question then, which Bryson and Schulz attempt to answer is, "How much?"
Candice hits on the head there. Whatever compensation that is equally as valuable as the expertise that they bring to the table. What makes this a slippery slope, though, is that in the realm of nonprofit, as we have all seen, business isn't business as usual. The rules are a bit different and expectations are not the same.
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