In the world of Jewish not-for-profits, some executives are above average. Or, at least, above average in compensation.
A new list of overpaid heads of Jewish organizations is made up of well-known names, each viewed by his board members as being exceptional, and each compensated exceptionally well. According to an independent analysis of Forward data, the list includes, in ascending order, the Anti-Defamation League’s Abraham Foxman, Malcolm Hoenlein of the Conference of Presidents of Major American Jewish Organizations, Morton Klein of the Zionist Organization of America and Matthew Brooks, who runs the Republican Jewish Coalition.
Finally, Marvin Hier, the longtime head of the Simon Wiesenthal Center, is “by far the most overpaid CEO,” the analysis concluded, earning more than double the amount expected, given the size of his organization.
On the other end of the list stand the underpaid — executives in Jewish groups that could be earning twice their salary, but for various reasons are undercompensated. Unlike the overpaid, who are all men, there are two women among the underpaid, including the only woman to run any of the 18 largest Jewish federations in the United States.
The analysis, produced for the Forward by Abraham Wyner, a professor of statistics at the Wharton School at the University of Pennsylvania, built a model of predicted salaries for Jewish executives, based on the size of the organization each heads. This is the key criterion used by the federal government to assess salary levels in the not-for-profit sector.
The results shed light on the animating factor in determining salaries in some of the Jewish community’s largest and most influential organizations: It’s not about how large the group is — it’s about the power of the leader’s brand name.
“The size of the organization is typically the most telling factor,” said Linda Lampkin, research director at ERI Economic Research Institute, a company specializing in compensation analytics and salary planning. But those who defend the generous salaries in the Jewish communal world disagree.
Who Is Overpaid and Who is Underpaid?
Executives’ salaries are plotted against the size of the organization they run (blue dots non-Jewish, orange, Jewish). The higher the dot, the higher the salary, the further right the dot, the bigger the organization. The higher above the cluster the more “overpaid” the executive, the lower below the cluster, the more “underpaid” the executive. Use the cursor to see more details and click the year buttons to compare proportionate remuneration over time. (Credit: Pedro Moura)
“The idea that it is only about the size is ridiculous,” said Norm Brownstein, a prominent Denver lawyer and top Democratic donor who chairs the Simon Wiesenthal Center’s compensation committee. His committee decided to pay Hier, the center’s founder and dean, $751,054 in 2012, which according to the Wharton analysis represents a 113% overpayment for an organization with only 121 employees and $25 million in expenses.
“What about the prominence of the organization in the Jewish world? What about the stature of its leader?” Brownstein asked.
Hier, 74, founded the center 36 years ago, and has since built it into a 400,000-member national organization that operates a museum in Los Angeles and another being built in Jerusalem. It also works with state and federal authorities to educate civil servants on tolerance. As the organization grew, so did Hier’s compensation: His wife and one of his sons are also on the payroll.