Monday, February 23, 2009

Insurance Exec Versus Nonprofit CEO Compensation

The head of Cigna received $22.7 million in compensation in 2007; the head of Aetna received $18.1 million (source).

The CEO of a nonprofit on average makes $150,000 a year.

Who's generally more interested in the well-being of the business's beneficiaries?

For comparative information on nonprofits, see Charity Navigator at www.charitynavigator.org.

7 comments:

One Sick Mother said...

ah! I would say the big-business CEO might be more interested and motivated to benefit the beneficiaries of the business. However in his (her) mind, the beneficiaries are NOT the insured, but the shareholders.

The insured are just ...product, and are often carefully vetted to weed out non-profitable units. The goal of these businesses is not to help people but to drive up the stock price, earnings and dividend numbers.

Cold right?

On the other hand, not-for-profit companies are exactly that, and therefore the priorities can be based on people and services, not on numbers.

FridaWrites said...

I think you're right. Something that also occurred to me is that people as a group need to be just sick enough to buy more than just emergency insurance for ER/cancer/surgeries, but not so sick as to cost a lot of money.

Shari Ilsen said...

Thanks for this posting!  To research charities, there's also http://www.greatnonprofits.org/ where you can read reviews of nonprofits. The reviews are written by people with first-hand experience with the nonprofit - their clients, volunteers, board members, donors. This is an essential aspect of learning about any charity's work.
~Shari Ilsen
Outreach Director
GreatNonprofits

FridaWrites said...

Thank you, Shari--it is good to have additional qualitative info about the work nonprofits do.

Elizabeth McClung said...

What makes me a wee ill is that while my brother is not CEO he used to be and still is a divisional Vice President and I believe on the 'bonus' list for one of those two companies (I'm trying not to out him). So when I say he is doing okay, he is. He also wrote me that he likes money because it makes it feel safe; in today's world, I can see why. But no, helping others is not his primary goal,he has the company spiel but the bottom line is enough profit for bonuses.

FridaWrites said...

It's a surprise that it's one of those companies. The execs generally do pretty well. I just read about measures the CEO of Beth Israel Deaconess hospital is trying to save jobs (employees volunteering some of own pay and vacation so everyone can work) and hope he is also donating some of his own money.

It is good enough to have enough money to be secure. Two jobs at lower pay or one at higher (but by no means wealthy) are enough for me.

FridaWrites said...

And yeah, helping others is good. It just seems the more people have sometimes the less willing they are to do so.