Wednesday, May 13, 2009
CEO Compensation Taking a Hit
It shouldn’t come as a surprise with the economic turmoil that CEO compensation has taken a hit in 2008. Even though a Bear Stearns employee is suing for the $2 million bonus he thinks he is owed, most CEOs understand all too well the impact to their personal wealth that the market and economic circumstances have had. The biggest impact was on bonuses received by CEOs, which were down 27% according to this USA Today article. In addition, in response to the downturn, some CEOs of big corporations have turned down their salaries all together, and received $0 during the 2008 fiscal year.
Of course, the average CEO compensation for those organizations in our database, at roughly $149,000 doesn’t compare to the millions that for profit CEOs bring in per year, but we do see some similarities. We see more evidence in FY 2008 of CEOs either receiving the same compensation as the previous fiscal year, or taking a pay cut compared to the previous fiscal year. In addition, public outcry over CEO compensation is at an all-time high in both the for-profit and non-profit worlds, which can be seen in the tremendous number of comments our users leave on this subject.
In the end we hope that highly qualified leadership will remain in place to lead charitable organizations through the tribulations faced today, and that the process for setting the compensation will be documented, as it now needs to be reported to the IRS.