I’m at it again. Blogging about compensation issues in the nonprofit sector. In a past blog, I talked about the balancing act a board often faces in being wise stewards of an organization’s resources, yet investing in capable leadership. An article this month, “A Too Sad Truth,” featured in the Nonprofit Quarterly, asks why society expects nonprofits to act in “poverty-like ways” and more importantly, asks why nonprofit executives and boards allow it to happen. Simone Joyaux’s article is thought-provoking.
The article reminded me of a call I had a number of years ago with a nonprofit CEO who bragged to me about her organization’s 8% overhead. She then spent the next hour divulging that they couldn’t make any headway in accomplishing their mission because there were no funds for infrastructure. I finally had to interrupt – could it be that if you invested more in your overhead, your organization might be more successful? If you were investing in things like professional development, compensation to attract capable staff, computers that worked all the time, rent in a facility that felt safe to visiting clients, visually appealing materials to solicit donors (instead of being fearful that your brochure looks “too nice”), etc., that you might better fulfill your mission? After a long pause, she admitted she’d never considered this might be part of the problem. Somehow she’d joined the ranks of one too many executives (and boards and funders and others) caught up in the yard stick game of some arbitrary measurement of what is and is not appropriate overhead. She revealed that while she’d been “willing to work for peanuts,” she did often wonder if it was fair to expect other staff to do so and really – could this be why she experienced such staff turnover? Hello? This organization closed 18 months later.
A few weeks ago, I had a great discussion with a passionate, educated and engaged board of directors. This bunch is doing whatever it takes to turn their organization around – taking it from the brink of disaster and ruin to success and real impact. But they are afraid. By low-balling in the area of executive compensation, they’ve hired less than capable executives before. And the organization paid the price – it nearly shut its doors because they got what they paid for. This board will not roll the dice in that way any longer. Instead they are gambling with a new strategy- they did their homework, they stretched to be competitive and attract the very best executive they could find, paying the most they possibly could while still nowhere near excessive and things are going well. They feel that the clients they serve are worth it and if their new strategy fails, at least they gave it their very best shot. But they are still afraid. Why? Because they fear the public doesn’t understand. The media, some funders, some boards and sadly, some executives would have us believe that society feels that, as Ms. Joyaux puts it: “A willingness to accept lower wages (much lower wages than for-profits) seem to be an indicator or qualification for one’s job in the nonprofit sector.”
I wish I could say it better, but Ms. Joyaux hits the nail on the head. So here it is:
It’s unethical and immoral to provide poor-quality programs and services. I think it’s unethical and immoral to provide poor-quality infrastructure, too. If you can’t provide decent working conditions and adequate support resources, that, too, is unethical and immoral. So go out of business. Close.
I’m tired of whiny nonprofits that think it’s okay to put all the money into programs and treat staff poorly. I’m tired of nonprofits that won’t fight against this silliness. I’m tired of organizations (nonprofits and watchdogs) that promote inadequate support for infrastructure by promoting inappropriate ratios.
This is important work. It deserves serious people. And serious people don’t work like this.
Please take a moment to read this article and let us hear from you on this one. The future of our sector depends on our ability to attract and retain the best leaders to improve our communities. I agree with Ms. Joyaux that it’s time to get it together and make a change. How can we best do this? It is very important.