Charity Leaders Should Pay Close Attention to Obama's Pay Guidelines

Nonprofit groups’ boards need to both understand the government’s proposed guidelines on compensation for officials of companies receiving federal bailout money and think about perceptions of the standards for executives’ compensation.

Not only would President Obama limit their annual pay to $500,000, but he would also require full disclosure of their employers’ compensation structure and strategy. In addition, the guidelines would prohibit or strictly limit “golden parachutes” and other forms of severance arrangements, and would require boards to adopt policies to ensure that executives henceforth avoid spending lavishly on private jets, office renovations, entertainment, and attendance at certain types of conferences and events.