Tag Archive for 'IRS'

Rutgers IEL: Compensation in the Nonprofit Sector

Joe Brown ▪ November 4, 2010 ▪ 0 Comments

It was my pleasure to present this week at Rutgers Business School as part of the Institute for Ethical Leadership’s 2010 Nonprofit Leadership Certificate Program. In addition to leading a plenary session on the use of social media and social networking for nonprofit organizations, I had the chance to address both the executive and emerging leaders tracks on compensation in the nonprofit sector.

The two presentations overlap in conveying information about the past, present, and future of nonprofit pay. The first presentation, for the emerging leaders, also offers a brief overview of executive compensation in the sector, as well as a primer on pay for performance approaches. The second, for established executives, provides recommendations on ways to enhance their organizations’ pay and performance management practices.

Emerging Leaders

Executives

Each of the conversations branched out in several interesting discussions, some of which I’ve touched upon in previous posts, and all of which were worthy of further discussion. You may find the following related posts of interest:

Are Your Executive Compensation Bases Covered?
The Buck Stops Where?
Development in Demand: Challenges for Fundraising Professionals and Employers
Executive Compensation at Boys & Girls Clubs of America: A Closer Look
Human Resources Maturity
A Look at Nonprofit IT Staffing
The Path to Pay for Performance
Paying Attention to Turnover in the Nonprofit Sector
Salary Ranges 101

Please feel free to share the presentations and posts with your colleagues and, as always, share your comments and questions!

The Nonprofit Version of Y2K?

Joe Brown ▪ May 14, 2010 ▪ 2 Comments

Do you remember Friday, December 31st, 1999? I do. I remember rushing to backup all of my business and personal data to CD-ROMs. I remember wondering just how fast and how far the market for COBOL programmers was going to fall. I remember losing count of how many times I heard Prince‘s 1999. I remember staying in that night to watch CNN, wondering if the anticipated global computer meltdown was going to occur (and feeling, I admit, just a bit of a letdown when it didn’t).

Over ten years later, heading into this mid-Spring weekend, I find myself experiencing a bit of déjà vu. If you are at all involved in the nonprofit world, you probably know by now that this Monday, May 17th, marks a significant deadline for nonprofit organizations nationwide. Under the provisions of the Pension Protection Act of 2006, any organization that has not filed its annual tax form with the IRS for at least one of the past three years by that date will lose its tax-exempt status. The 2006 law actually only changes the game for organizations with annual revenue below $25,000, which have for decades been exempt from filing requirements. For larger organizations, the filing requirement has not changed.

How hard could it be?

If no action is taken, more than 365,000 nonprofits will lose their tax exemption — along with their ability to accept tax-deductible donations and receive foundation grants. But if this fate befalls an organization, it means that at least one of the following statements are true of its leaders:
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Are Your Executive Compensation Bases Covered? (video)

Joe Brown ▪ April 12, 2010 ▪ 0 Comments

In this video, nonprofit executives and board members are reminded of the risks associated with not having a formal executive compensation policy and provided with guidance as to how to strengthen their organization’s governance of executive compensation.

View the text version of this post.

Are Your Executive Compensation Bases Covered?

Joe Brown ▪ April 12, 2010 ▪ 0 Comments

View the video version of this post.

A recent survey found that 73% of nonprofit organizations have a formal policy to review executive compensation. As a human resources and management consultant to nonprofits, what I found striking about this statistic is that it means 27% of organizations do not have a formal policy.
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The Fine Print: BGCA Executive Pay Update

Joe Brown ▪ March 31, 2010 ▪ 0 Comments

In a post a couple of weeks ago, I attempted to shed some light on the then-breaking “scandal” regarding the compensation of Roxanne Spillett, President of Boys & Girls Clubs of America. I was glad that my post, which was intended by as an analytic and non-judgmental look at the numbers behind the controversy, was received that way by most (including Dan Pallotta, an outspoken advocate for higher nonprofit pay levels). Hopefully, the conversation will take an even more informed turn once the additional information requested from BGCA by Senator Grassley et al. is received and becomes public. (The Senators requested that the additional information be provided by Monday, March 29th. To this point, there have been no reports with regard to the receipt or content of that information.)

While we wait, I wanted to respond to a very good question that I received regarding my original post. This involves an important clarification to the comparisons I provided, but also points to just how muddy the waters around nonprofit executive compensation analyses can be.
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Executive Compensation at Boys & Girls Clubs of America: A Closer Look

Joe Brown ▪ March 18, 2010 ▪ 7 Comments

For an update to this story, please see
The Fine Print: BGCA Executive Pay Update

The debate around the compensation paid to Roxanne Spillett, President of Boys and Girls Clubs of America, prompted by an inquiry on the part of Senator Charles Grassley and three other Republican Senators, is one which continues to grow, at least here in the blogosphere and twitterverse. While I made passing mention of the controversy in my post yesterday (Canada vs. USA…No Hockey Involved), I feel compelled to address the issue a bit less obliquely. However, if you’ve come here looking for impassioned moral or emotional arguments on either side of the controversy, you will be disappointed. That ground has been well-staked, on one end by Dan Pallotta, in his Harvard Business Review post “Senator Grassley Is Undermining the Humanitarian Sector”, and on the other by Rosetta Thurman, in her Chronicle of Philanthropy post “Nonprofit CEOs Who Want For-Profit Salaries Should Work At For-Profit Companies“. Each of their posts have received a fair number of comments on both sides of the issue.
Continue reading ‘Executive Compensation at Boys & Girls Clubs of America: A Closer Look’

Canada vs. USA…No Hockey Involved!

Joe Brown ▪ March 17, 2010 ▪ 7 Comments

Nonprofit executive compensation gets a lot of attention in the United States these days, as I wrote in my post yesterday on the Mission Connected blog (“Are Your Executive Compensation Bases Covered?“). Over the past week, the topic has gained prominence in both the US Senate and the mainstream press, as Senator Charles Grassley (R-Iowa) and three other Republican senators have raised questions about the compensation provided by the Boys and Girls Clubs of America to the organization’s president. That controversy has struck an emotional chord on both sides of the issue, including a scathing response by author Dan Pallota.

In this context, I found it notable to learn this week that the issue of nonprofit executive compensation has also attracted attention at the federal level in Canada. Specifically, as Jane Taber reports in her Ottawa Notebook blog, a Liberal Member of Parliament from Ontario has introduced a “charity transparency bill”. Under the legislation proposed by MP Albina Guarnieri, all registered Canadian charities would be required to publicly disclose the salaries of the organization’s five highest-paid employees. Further, the annual salary of all executives would be capped at $250,000.
Continue reading ‘Canada vs. USA…No Hockey Involved!’