Compare your CEO compensation, benchmark your reserves

Recent ASAE Research Foundation studies offer meaningful comparative data to support association decision making in key areas, including CEO compensation and management of investment reserves.

Two recent ASAE Research Foundation studies underscore the application of benchmarking evidence in decision making. The first, the ASAE Blue Chip CEO Compensation Study, 2020–2021 Edition, reports that 79 percent of respondent organizations base CEO compensation on benchmarks. The second, Association Investment Policies, Practices, and Performance, 2020–2021 Edition, provides important peer data for investment reserve governance and management (the report will be available soon).

Both studies provide markers for making insightful comparisons. The Blue Chip study connects higher base salaries and other compensation to larger staff and budget sizes, as well as broader international scope. The Investment Policies, Practices, and Performance study shows that organizations’ practices correlate to the size of their investment reserves, so the most meaningful comparisons are among peers with similarly sized investment reserves.

Examining High-Level Compensation

The Blue Chip CEO Compensation Study isolates data from ASAE’s 2020–2021 national compensation study to look only at respondents earning $200,000 or more in base salary. ASAE compensation research, including this report, is the most commonly used compensation benchmarking resource, cited by 76 percent of reporting organizations. Research from regional societies of association executives (48 percent), consultants (43 percent), and national surveys (42 percent) are the next most frequently used.

Among the studied group, the Blue Chip report pegs median base salary at $304,850 annually, with the top-earning quarter of CEOs at associations with 101 or more staff earning $639,366 or more. At the smallest-staff associations (one to five employees), the median base salary is $232,000, with the top-earning quarter of CEOs in that group earning $289,860 or above. The report also covers total compensation, benefits, employment arrangements, contract and performance review practices, and more.

Governing Investment Reserves

The Association Investment Policies, Practices, and Performance study, conducted since 2014, delves into how associations allocate their investments and govern their reserves, and it provides an update on investment performance. Additionally, the study includes a financial market overview and analyses from Fiducient Advisors (formerly DiMeo Schneider), as well as a COVID-19 supplement.

According to the study, small associations have increased their allocations to equities during the past five years, though they still trail larger groups in this area. Associations with larger investment reserves again outperformed their smaller counterparts, due to the larger groups’ investments in equities. To manage their portfolios, 87 percent of respondent associations reported using investment advisors.

Additionally, associations are tapping into their reserves—56 percent reporting doing so for one reason or another. In COVID times, nearly 31 percent of respondents either pulled from, or borrowed against, reserves to help supplement operations.

Keith Skillman, CAE

Keith Skillman, CAE, based in Lawrence, Kansas, writes about associations and their work.