I consistently have mixed feelings about nonprofit executive pay. On the one hand, I believe first that nonprofit execs deserve salaries that represent their responsibilities (and training) and for sure, if they are managing large institutions, they maybe even need to be paid at rates that are competitive with for-profit counterparts. I also believe it's up to a nonprofit's board to determine what is appropriate compensation while recognizing that boards comprised of well compensated for-profit folks may actually set higher salaries than boards without these type of folks.
Meanwhile, just because someone in the for-profit world is paid, in my opinion, outrageously, doesn't mean their counterpart should be paid outrageously. Hospitals of course come to mind. A recent report via the Nonprofit Newswire noted a report by CEO Watch that stated that "CEO pay at 11 nonprofit hospitals in the state for 2007-2008 exceeded the amount of charity care their institutions rendered." By the way, these CEO's all were paid more than $1 million.
Now comes the quandary, again. I don't question that running a hospital is demanding and requires really smart accomplished people to do the job. But $1 million? And, at the cost of "charity" care? Just doesn't seem right. But then, neither does the capitalist pay system overall -- where sports and entertainment personalities make more than the average working person can ever-make in 5 or 10 lifetimes or there's the Wall Street guys and, well the list of inequities goes on.
So, maybe we should, instead of being critical, yell victorious that there are some within the nonprofit sector who actually do benefit well within an economic system that is extremely selective about who gets rewarded for being smart, skilled and hard-working.