Nonprofit Organizations Benefits

The existing literature on nonprofit governance suggests board roles are widespread and varied (Brown & Guo, 2010). For example, in BoardSource (2004b) as cited by Zimmermann

Working in nonprofit is gratifying and at the same time challenging. As an administrator for a major nonprofit organization, I have witness first-hand the effects of staff retention and excessive turnover and its effects on the quality of service provided to clients and the increase in the cost of recruitment. However, recent data support how nonprofits continue to experience growth, while the private sector remains stagnant. Per the nonprofit quarterly the steady growth of nonprofit was estimated at 14.4 million people in 2013. In 2003, nonprofit organizations paid an estimated $425 billion in wages. Ten years later, in 2013, total nonprofit wages had risen to $634 billion. This increase in paid wages represents a growth of 49.2 percent (Nonprofit

Retrieved from http://eds.b.ebscohost.com.ezp.waldenulibrary.org/eds/ Hanson, K. O., & Gielnaik, P. (2014). Unavoidable ethical dilemmas for non-profits. Markkula Center for Applied Ethics, Santa Clara University. Retrieved from http://www.scu.edu/ethics/dialogue/candc/cases/fundraising.html National Council of Nonprofits (n.d.). Ethical leadership for nonprofits Retrieved from https://www.councilofnonprofits.org/tools-resources/ethical-leadership-nonprofits National Organization for Human Services (n.d.).

2009). There is a large margin in executive compensation that is dependent on features such as geographical location and size. According to the “Charity Navigator,” in 2008, the median CEO salary in the Northeast was $351,000 for large hospitals, and $120,000 for small hospitals. In the Mountain West region of the US, the median salaries for a large hospital was $194,374, and only $80,790 for small hospitals (Charity Navigator 2010)

Based on the data available between 2006 and 2013, the CEO’s annual salary is around $5.8 million compared to $42,000 to the average employee.

Most nonprofit agencies follow the same management structure. The structure normally consists of a vertical hierarchal structure with the chief executive manager at the helm, and divisional leaders rounding out the strategic leadership team. Since 9/11, then government shutdowns, multiple wars, natural disasters, and the government sequester, the challenge to most nonprofits is to compete for every available charitable dollar. Chief Executive Officers (CEO) of nonprofits must not only be skillful in maximizing the outcomes with fewer dollars, but also politically savvy in vying for monies for federal, state, local, foundation, and private funding sources.

At the center of any successful nonprofit organization there is an effective chief executive and board of directors. These leaders must work as a team with a vision and specific skills, to effectively produce resources in order to accomplish the organization's goals. The majority of the decision making authority and leadership is shared amongst board members; however, critical management skills and day-to-day operational decisions rest within the authority of the chief executive. However, members of the board must also be sufficiently skilled in management in order to assess the work of its director to assist in the implementation and evaluation of strategic decision making.

The final reason that the companies are over paying CEOs is that the nonprofit organizations are paying their CEOs very highly. According to Peter Frumkin in his article “Are nonprofit CEOs overpaid?” he writes about “264 big nonprofit CEOs earn a salary of $207,990… and a CEO of the Cystic Fibrosis Foundation earn 389,327” (83). These are a nonprofit companies yet they are paying there CEOs quite a bit of money that could be going toward the cause they are trying to raise for. The CEOs should not be earning that amount of money when it is being given to go towards the cause that they people are giving their money for. A CEO that is supposed to find money to help find a cure for cystic fibrosis is taking a good amount of the money home that

The American Red Cross’s organizational structure and compensation has a tremendous effect regarding the ethical behavior among the chief executives when addressing the frequency in turnovers of top executives that helped to weaken the organizations ability to carry out its federal mandate. The American Red Cross’ reputation also began to take a downward fall as the rewarding of large bonuses and severance packages were given to top executives when they left the organization. There were leadership issues among the local chapters that lead to management misconduct and it dampened the fundraising efforts. When a well-known nonprofit agency such as the American Red Cross cares more about paying out executives than saving lives it creates a low

CEO of Walt Disney Company, Robert Iger, had a salary of $51.1 million against $37.8 billion in revenue, or 0.13% of revenue. By contrast, Ms. Spillett’s compensation was only 0.03% of revenue, a quarter of Robert Iger’s.

I believe that CEO's are justified by there pay. They are not your average employee and as a result are paid higher. CEO's work there entire life's and put so much stress on there families to reach the top. There's an article that I will attach a link to that speaks about how choosing the wrong CEO can result in an estimated 100 Billion dollar loss. Imagine working your whole life and failing as a CEO. No company will ever hire you on again in that position as every move you make is watched and know by every fortune 500 company. Much like in sports the best athletes are paid top dollar in the hopes they can bring there team or business in a CEO's case a championship. The Warriors were bought by Joe Lacob for $400 million and now are worth over

Nonprofit organizations survive essentially on the various resources they are able to obtain. Money is obviously an enormous resource, as any organization needs money to survive. Money can come from various sources such as state and federal government funding and/or grants, donor cash, fundraising methods, donated products or services, and most importantly: volunteers. Volunteer labor makes up a total of one-third of the national income attributable to nonprofit organizations in the United States (Young, 2007).

This report explores the issue of the pay that top executives make, and the reasons why they do. It also suggests improvements that can be made to make the system better. High Pay Seems Small When Compared To Company Profits Many companies pull in profits that are extremely high. When an employee of such a companies salary is compared to the amount of profit that the company earns, it starts to seem reasonable. It only makes sense that if the employee is directly responsible for the success of their company, then they deserve to get their payback. It seems ironic, but many salaries even look small once compared with a companies profits. Top Executives Are Under A Lot Of Pressure Being the CEO of a

Nonprofit organizations have several functions, and not each one is alike. Essential to all non-profit organizations are four functions: planning, budgeting, funding and management.

Are America's CEOs paid more than they deserve? Many people's answer is a vehement: Yes. That view is reinforced anew every spring, when companies file their financial statements and we learn how much CEOs were paid last year.