One in Five Foundations Compensate Board Members, Study Finds

According to a survey by the Council on Foundations, slightly more than a fifth of survey respondents compensate board members for their service.  

Based on the council's 2014 Grantmakers Salary and Benefits survey, the 2014 Grantmakers Salary Tables and Board Compensation Tables suggests that 21.9 percent of the more than one thousand grantmaking public charities and community, corporate, family, independent, and operating foundations surveyed compensated their board members, with a median total compensation figure of $71,438. Of the grantmakers that compensate board members, 5.2 percent paid only the board chair, 34 percent compensated other board members only, and 60.8 percent compensated both the chair and other board members.

Among organization types, independent foundations were most likely to compensate board members (51.3 percent), followed by operating foundations (37.5 percent) and corporate foundations (25 percent). The survey also found that grantmaking public charities paid the most in terms of financial compensation, with a median figure of $198,100, compared to $86,125 for independent foundations and $69,775 for operating foundations. While grantmakers with more than $2 billion in assets were most likely to compensate board members (54.2 percent), foundations with assets between $1 billion and $2 billion paid the most in total compensation ($290,500). Among regions, the survey found that organizations in the West had the highest median compensation ($109,000) and those in the northeast the lowest ($45,000).

The survey also examined the salaries of foundation staff and found that CEOs and presidents were paid a median base salary of $160,000 across all grantmaker types, ranging from $124,373 at community foundations and $162,500 at grantmaking public charities to $171,596 at family foundations, $175,000 at corporate foundations, $210,500 at independent foundations, and $270,833 at operating foundations.

The report notes that payment of excessive or unreasonable compensation violates federal and state law and can result in excise taxes against board members — and that reasonable compensation depends on a range of factors, including skills and experience, job functions, actual time spent performing job functions, and compensation at comparable organizations.

"We get a lot of inquiries every year about board pay, so we know this information is important to our members," Tonia Bain, the council's project manager for research, told the Chronicle of Philanthropy. "It's important for grantmakers to be able to see what's appropriate compensation in their own field, so if they wanted to compensate, they would have the tools to help set reasonable levels."

Maria Di Mento. "20% of Grant Makers Pay Trustee Fees, Study Finds." Chronicle of Philanthropy 10/01/2014. "2014 Grantmakers Salary Tables and Board Compensation Tables." Council on Foundations Report 09/30/2014.