The infographic here about the highest paid CEOs in non-profits seems useful to me for two reasons.
First, many people seem uncomfortable with non-profit organizations, serving higher social goals, paying market-level compensation to employees. In my years of dealing with students of entrepreneurship there was an assumption that people who work in non-profits earn less than their counterparts in the rest of business. I question that assumption. If the non-profit is funded by donors, doesn’t it have to pay fair rates to keep good people? Do its employees have to be donors as well, in the sense that their salaries are below market rates?
Second, aside from compensation levels for all employees, looking at the CEOs and what they earn (in this infographic), is there a top end to this that goes to far? Should organizations funded by donations pay their leaders salaries like the ones in this infographic? Maybe they have to in order to get the right level of leadership?
What do you think?
Source: BestMSWPrograms.com
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I worked with some national charities and some smaller local ones. From what I saw the high-ranking people got into those positions based on the names they could drop. There was nothing resembling leadership going on, it was large donor brown-nosing, plausible deniability, and working an expense account.
I’ve also worked with small- to medium-sized privately owned businesses. There the executives were either people who started a company and named themselves executives even if they weren’t the best fit for the job, or they were appointed through nepotism or a good old boy system.
So yes, pay executives fairly for the work they do. In my experience that’s about 10% of what they are actually paid.
Hi Charles, thanks, interesting comment. And you have a good track record for comments on this blog, and thanks for that too. But I want to put in a good word for those “people who started a company and named themselves executives.” Perhaps because I count myself among that group. We earned it. All the best, Tim.
No offense intended, Tim. I am certain you were completely capable of doing the job of CEO. In my experience many who start a company think they have the skills to continue managing it as it grows. Few have the humility to give themselves an honest evaluation. It wouldn’t surprise me if you asked yourself that question frequently and fretted about making the right choice for your growing company. That’s the difference between a despot and a leader. 🙂
Thanks Charles, and I do agree with your point. In my case too, I liked the startup and ramp up phases myself much more than the long-term management phases. Different skills and mentality are required, that’s for sure. Tim
Yes, they should be paid fair compensation for the work they do. These “high” paid CEO’s for the non-profits are nothing compared to what CEO’s in private industry are paid…. some in the 10’s of millions of dollars with stock options, etc, etc, etc.