How much can I pay myself as a director’s salary?

• The total amount of compensation can be up to $750,000+
  Although there have been no prior empirical analyses of private foundation director compensation, the most comprehensive descriptive analysis of director compensation is by Ahn et al. (2003) who surveyed 238 foundations and found that the amount of director fees varied greatly and is not always related to the size of the foundation, with a number of foundations paying all their directors the same amount of money, while others provided a range of fees. Director fees varied from a low of $500 to a high of $750,000 per year.
• Factors affecting compensation include:
  • Complexity of PF operations (grant-making only or operating?)
  • Asset size of PF (and related sophistication of investments)
  • Complexity of programs (robust scholarship program?)
  • Time demands of directors
  • Geographic area
  • Is compensation dependent upon asset performance of PF?
• Factors to consider:
  • What functions are required of and actually performed by the directors or trustees?
  • What is the realistic time commitment for all tasks (preparing for meetings, reviewing statements/programs, attending meetings)?
  • What level of skill is required for the director to adequately perform his or her duties?
  • What are similar foundations (similar in size, complexity, requirements and location) paying their directors?
• Review comparable compensation data:
  • Salary surveys compiled by independent firms (for example, Council on Foundations and Exponent Philanthropy)
  • Local Resources (Philanthropy Southwest)
  • Forms 990-PF for other private foundations (their websites and Guidestar)
  • Compensation experts with access to more data
• For more information, read this book.