Board Compensation

About this collection: This Content Collection provides guidance on the legal regulations regarding compensation, suggestions for how to initiate a conversation among your board members about whether or not compensation is appropriate, and suggestions for how to develop a written policy based on this conversation.

Deciding whether to compensate or reimburse family foundation board members can be a difficult and complex decision. This Content Collection provides guidance on the legal regulations regarding compensation, suggestions for how to initiate a conversation among your board members about whether or not compensation is appropriate, and suggestions for how to develop a written policy based on this conversation.

Note: In lieu of compensating board members, many family foundations offer discretionary grants for their board members as a way to honor their volunteer time and effort on behalf of the foundation.

Discussion Papers, Webinars, and Other Resources

Board Compensation: Reasonable and Necessary?

Passages Issue Briefs
Deciding whether to compensate or reimburse family foundation board members can be a difficult and complex decision. This Passages Issue Brief provides guidance on the legal regulations regarding compensation, suggestions for how to initiate a conversation among your board members about whether or not compensation is appropriate, and suggestions for …
May 25, 2005

Board Compensation: Reasonable and Necessary?

Deciding whether to compensate family foundation board members can be a difficult and complex decision. This presentation reviewed some of the arguments both for and against trustee compensation, provided suggestions for how to initiate a conversation among your board members about whether or not compensation is appropriate, and provided suggestions …

Foundation Trustee Fees: Use and Abuse

Report
Many foundations pay trustees for their board service, and trustee fees count as part of the mandated 5 percent annual payout for foundations. This report examines the 990-PF reports of 238 foundations in order to study the rationale behind and necessity of trustee fees. It recommends limitations on trustee fees and modifications …

Child Care and More

Article
Q: Our foundation’s third generation is coming on the board and some have young children. Some family members say the lack of child care during board meetings hinders participation. Can the foundation pay for child care so that parents can attend board meetings?

Self-Dealing: A Concise Guide For Foundation Board And Staff

Article
In basic terms, the rules against self-dealing are broad and far-reaching. They generally prohibit any direct financial transaction between the foundation and virtually all persons closely related to the foundation. Even if the financial transaction is between the private foundation and an unrelated third party, the act can be a …

Sample Policies and Practices

Governance and compensation committee charter (The Wallace Foundation)

Sample
The Governance and Compensation Committee of the Foundation’s Board of Directors (the Committee) assists the Board in fulfilling its responsibilities in governance and the oversight of total compensation practices. The Committee’s purpose is to oversee the governance processes of the Board of Directors; identify and recommend candidates for …

Policy Central: Board Meetings, Board Job Descriptions, and Rotation Policies

Sample
Boards that anticipate and plan for potential bumps in the road are far more likely to avoid difficult situations than those who create policies while in the middle of crisis. Included here are conflict of interest policies, board position descriptions, election and rotation policies, and much more. Please read our …

Additional Perspectives and Examples of Excessive Compensation

Trustee compensation: Should your foundation pay?
GMA Foundations

They Get Paid? Foundation Board Fees Send the Wrong Message
Inside Philanthropy

Private Foundations and Compensation: Family Ties Can Lead to Problems
Leaffer Law Group

Can Board Members Be Paid?
National Council of Nonprofits

When Salaries Are Bigger Than Grants
The Chronicle of Philanthropy

Some Officers of Charities Steer Assets to Selves
The Boston Globe

Almost Crimes: The Boston Globe’s Foundation Exposés Revisited
Nonprofit Quarterly