Selecting the right leader for your organization is a difficult task. But once you decide who you want, how do you make an attractive offer? And once they sign on, how do you make sure they stay?
Those were the questions being asked by Stuart Meyers, MBA, EdD, president of The Meyers Group, who gave a presentation at the 2012 National Council Mental Health and Addictions Conference called "For Board Members Only: Executive Compensation Packages."
The session addressed how board members should prepare in order to select the best leader for the organization and develop a mutually acceptable formal agreement and compensation package.
According to Meyers, many organizations don’t have contracts or employment agreements with their CEOs. In addition, many don't realize that retaining a good CEO is a board’s “single most important responsibility.”
“Boards need to have something in place so that there is a sense of stability and security for everyone involved,” explained Meyers. “It also gives staff have a greater sense of security and continuity.”
Compensation packages need to be “win-win situations” for both the CEO and board, he explained. Of course what ends up in a final agreement depends on the idiosyncrasies of the area, the board’s feeling and the candidate’s needs.”
For example, local moirés often enter the discussion. A community may be sensitive to how much a CEO of a nonprofit ought to make. In regard to the candidate, Meyers said packages often should include personal factors such as the cost of relocation.
“It might be a great fit, but if a person is upside down in their current mortgage, it makes it challenging for them to decide to leave their current position,” explained Meyers.
As a result, he said boards should conduct market analysis and evaluate comparable compensation packages to “get as close to the character of that organization as you can—both regionally and in terms of focus and identity.”
Of course, the issue of retention is just as important for behavioral health organizations as it is in any other field.
“There is always a pool of really talented people out there who are looking to make a change,” Meyers said. “That means boards need to be thinking about what how to create agreements that will encourage a really good CEO to stay.
In the end, the key is to understand that “here are no sides,” said Meyers, rather it’s a matter of finding common, agreeable ground.
“If you’re a CEO, what’s going to keep you there? If you’re a board member, how do you keep the person you have? They just need to have an open dialogue about what works,” he said.