The United Way of Central Carolinas' board of directors may think that by ousting president Gloria Pace King they have solved their problem. They haven't.
The United Way's problem is not negative publicity. The problem is what its board did and didn't do.
What it did – rather, what its executive committee did – was OK a compensation package significantly higher than for executives at comparable or larger United Way agencies. What it hasn't done is be timely, clear or transparent in explaining exactly how and when that package was devised and who thought it was a good idea.
Ms. King's salary and bonus package, $375,000, is fourth highest among 31 United Ways the Observer looked at. Her bonus was the largest among a sample of 14 agencies the same size or larger. Her retirement package – she's 63 – would pay her more than $200,000 a year for life.
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Many local donors were outraged in June when the Observer and its news partner NewsChannel 36 reported Ms. King in 2007 received a pay and retirement package worth more than $1.2 million.
To be sure, any nonprofit group is free to pay its executives as it sees fit. But the United Way raises its money from thousands of donations from thousands of people, many paying small weekly amounts from their paychecks. It needs the community's good will in order to carry out its mission: Collecting and disbursing money to dozens of worthy groups such as Crisis Assistance Ministry and the Teen Health Connection.
If donors angry about Ms. King's pay stop giving, it's those community groups and the needy people they serve who suffer, and they don't deserve to. This year's United Way campaign starts next week, so the board had reason to act now.
Tuesday the United Way board offered an apology and conceded, “We made a serious mistake.” The retirement package, it said, “exceeded what our community expects for a leader of a nonprofit organization.”
It laid out steps it will take: It named retired Wachovia executive Mac Everett interim president. It will fulfill its contractual obligations to Ms. King, it said, and pay her supplemental retirement plan. An “independent review panel” will investigate the compensation decisions and recommend improvements for the agency and board.
Those are needed moves. But the board should go further. It should pledge to open its books to the public, which deserves to know how donations are spent.
And it needs a truly independent review panel. It has tapped Robert Sink, a lawyer at Robinson Bradshaw & Hinson. That firm's clients include Wachovia, whose CEO sat on United Way's executive committee. The firm's Russell Robinson is a United Way “life director” who hired Ms. King. We respect Mr. Sink's abilities but this job requires someone who can call the shots as he sees them without worrying about offending a client or a colleague.
The board made the pay decisions, but it's Ms. King who's out of work. Something isn't right.