Nonprofit CEO compensation: Much ado about not much

The Sunday Boston Globe (Leading nonprofit jobs hold big perks) was as predictable as it was misguided. Here’s the juicy lead:

They are not only well-paid, but many receive an array of generous perks — housing allowances, home loans, club dues, and free travel for spouses. One was awarded a quarter-million dollars in retention bonuses. Another is reimbursed for his children’s college tuition.

Exhibit A is the president of the Museum of Science. He’s the one who’s reimbursed for his kids’ tuition. But wait, it turns out he worked for 10 years as a dean at Tufts, where free tuition is a standard part of the package, and the MoS simply matched this perk to lure him away. His whole compensation of $509,000 includes two tuitions plus a gross-up to cover the taxes. That benefit will end once his daughters are done with school.

I’m not afraid to say it: Mid-to-high six-figure compensation is not too high for leaders of large nonprofits such as the Museum of Science, Museum of Fine Arts and the Boston Symphony Orchestra. And it makes sense to tailor perks to the needs of the organizations and of the executives.

Many moderately successful, mid-level people in professional services in Boston make as much as these leaders. And many professional services partners, for-profit managers, and entrepreneurs make a lot more. Unlike the non-profit leaders, most folks in the private sector generally do not have their compensation disclosed.

It’s fine to scrutinize compensation packages, but if these are the most egregious examples the Globe could find then I suggest the story did not merit top billing it received.

By healthcare business consultant David E. Williams, president of Health Business Group.


January 26, 2015

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