March 16, 2010 | Read Time: 1 minute
A top senator’s scrutiny of the Boys & Girls Clubs of America is damaging the image of the nonprofit world and is a sign of an unfair expection that nonprofit leaders earn less than their for-profit peers, says a charity expert.
Dan Pallotta, author of Uncharitable, writes a scathing article about Sen. Charles Grassley, who is one of four senators asking the Boys & Girls Clubs to provide details about what it spends on executive compensation, lobbying, travel, and other items.
(Read The Chronicle’s article about the scrutiny and the charity’s response.)
On his Harvard Business Review blog, Mr. Pallotta says Mr. Grassley’s public questions about how much the charity’s chief executive earns are an “underserved attack” that has “created what will likely now be a 10-year uphill public-relations battle.”
He says that the Iowa Republican’s comments demonstrate a double standard between nonprofit and for-profit pay and a misunderstanding of how charities operate. Mr. Pallotta also knocks the news media, especially CNN’s Wolf Blitzer, for reporting the story without offering better context.
“The money paid to a valuable CEO is not money taken away from the cause. It’s an investment in the cause,” he writes. “How many clubs would have had to close if the organization had been without an effective CEO, or if it paid a person half as much and only got half as much productivity?”
He continues: “Senator Grassley has just dealt a sucker punch to the Boys & Girls Clubs, its CEO, and the millions of kids it helps every day in his own self-interest.”
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