Pay is up but people want flexibility
Job candidates for association C-suite seek more options to work away from office
Compensation levels for top association staff are rising, but so are expectations among job candidates to work remotely, two recruitment and compensation experts said during a CEO Update webinar on executive pay.
Recruiter Leslie Hortum of Spencer Stuart and compensation expert Charlie Quatt of Quatt Associates joined CEO Update Managing Director Mark Graham on Nov. 3 for an hour-long discussion on the compensation and recruitment outlook for association C-suite positions. One common theme: The COVID-19 pandemic has left a deep mark on the association landscape, with job candidates demanding more flexibility on remote work and less emphasis on incentive pay.
“We’re going to start seeing pressure for people to move incentive compensation to base salaries because they won’t trust any longer that the incentive compensation will be rewarded,” Quatt said.
That deemphasis on incentive pay comes after nearly two years of associations missing performance marks because of the economic headaches created by the pandemic. At the same time, the disaster had caused many workers to reevaluate their career priorities, leading to employee churn at organizations at all levels.
“People are leaving (their jobs) because this has been a time of making interesting choices about their lives: Where and how they spend their time, where they want to live, what kind of flexibility they want to have,” Hortum said. “There is an awful lot of churn. We’re turning work down all the time because we cannot keep up with demand for our services.”
Executive compensation is rising because demand for talent is high and employees have a lot of leverage at the moment, Quatt said. At the same time, women and people of color are pushing to ensure they are not paid less than the executives who preceded them. The association C-suite has historically been very white and very male.
Organizations “are being asked to invest in two ways,” Quatt said. “They’re being asked to invest in keeping their talent and they’re also being asked to invest in making sure that people are accurately paid. And both of those can cost money.”
Many associations have boosted their diversity, equity and inclusion efforts in recent years, especially since the 2020 Black Lives Matter protests sparked by the killing of George Floyd by Minneapolis police officers. That focus has carried over to CEO-level job searches, with search committees demanding a demonstrable history of action, according to Hortum.
“What search committees are asking candidates is not just how do you feel about it, but what have you done about it?” she said. “How have you shifted the makeup of your board to be more inclusive? How diverse is your senior leadership team? How about one level below that? They’re getting very granular and specific: not just do you think this is a good idea, but what have you done to impact the results?”
Work away from work
Compensation is important to job candidates, but so is an organization’s culture and mission, according to Quatt. Still, the most in-demand job perk at the moment is the ability to work remotely.
“We’re finding that the No. 1 issue is flexibility,” Quatt said. “People will accept more readily that they be at work a full week if they’re able to balance it with the personal schedules they have.”
“When people know that there’s a certain amount of flexibility, and this goes into customization of the compensation plan, that can go a long way in letting people fit their personal lives and preferences into the fact that they’re being required to come to work,” he added.
One example Quatt cited was a client that started paying its employees a monthly stipend to offset the cost of driving to work instead of using public transportation. “In other words, we may start seeing people actually getting money for coming to work on a regular basis and not getting it if they don’t,” he said.
One benefit of flexibility is associations can draw on a much larger pool of job candidates for top positions, according to Hortum. The downside, particularly for CEOs, is how do executives build a workplace culture if they rarely see their employees in person?
“A lot of people who fail in their jobs don’t fail because they’re not smart, hardworking people. They fail because it’s a bad culture fit,” Hortum said. “And so driving a culture that that is about inclusion and engagement and people feeling that they were aligned in the mission is really important. So how do we do that if people aren’t in the office?”
Still, there is no denying the popularity of the perk in attracting talent, she noted.
“What I have heard anecdotally is that those who are mandating back-to-office full time, people don’t want it, they’re not ready for it,” Hortum said. “Will we all feel differently a year from now? I don’t know, but right now, the mandate idea is not playing very well.”