[Note: Raising the issue of excessive CEO salaries prompted a lot of comments from readers, most off-line, and additional posts from me. But here are my final words on the subject, at least for a while. A friend, knowing that I was having knee surgery during these weeks, and noting the tone of my critiques on executive compensation, told me the pain must be making me cranky. There’s some truth to that. Here’s one last blast – then on to other things next week.]
In my last post I talked about how CEOs of private foundations get paid too much. I didn’t say that the president of a particular private foundation was overpaid – simply that, as a rule, CEOs of private foundations receive much higher salaries (a median of $466,500 for large foundations) than the demands of their job would seem to justify.
So how did these extraordinary salaries come about? One driver, ironically, seems to be the set of instructions from the IRS designed to ensure that the salaries of nonprofit CEOs did not climb out of control. Continue reading