2006 Compensation Report: ICSOM Executive Directors

The 2003-2004 season was a busy year for the executive shuffle among ICSOM ensembles. In fact, there was so much shuffling that almost 1/3 of all ICSOM symphonic orchestras had one or more executive receiving compensation for only a portion of the season. And then there’s that thing in Saint Paul…

Where The Numbers Come From
All data presented in these reports coincide with the corresponding documentation from the 2003-2004 season. In order to provide information that is as accurate as possible, data is gathered from the following sources:

  • Executive Director (also called president and/or CEO) Compensation figures were obtained from their respective orchestra’s IRS Form 990 for the 2003-2004 concert season.
  • Total Ensemble Expenditures were also obtained from each respective orchestra’s IRS Form 990 for the 2003-2004 concert season.
  • Musician Base Salary figures were obtained from compensation records collected by the American Federation of Musicians and IGSOBM (Seattle) for the 2003-2004 concert season.

The Executive Director Compensation figures include the combined amounts reported as what the IRS classifies as “compensation” and “contributions to employee benefit plans & deferred compensation”. However, each orchestra does not always report figures for the latter category. At the same time, there were some noticeable inclusions in the deferred compensation category for this season.

The Musician Base Salary figures collected by the AFM for ICSOM ensembles are done so on an annual basis and reported in a booklet entitled Wage Scales & Conditions in the Symphony Orchestra.

Adaptistration makes no claim to the accuracy of information from documents compiled or reported by external sources. If you have reason to believe any of the information is inaccurate or has changed since reported in any of the above sources and you can provide documentation to such effect, please feel free to send in a notice.

What The Numbers Don’t Show
It is important to remember that the numbers shown do not always convey a complete compensation picture. For example, an executive director may have had a large increase in salary because they were leaving a position and per terms of their contract they may have received a sizeable severance or deferred compensation package. As such, the cumulative compensation may artificially inflate or reduce their annual earnings, a common occurrence for the 2003-2004 season.

Furthermore, these figures may not reflect bonuses or other incentive payments, therefore underreporting what executives may actually earn. Also missing from the figures are expense accounts and other perks, which are rarely reported on the IRS Form 990’s. As such, the cumulative compensation for executive directors may or may not be more than what is listed.

Additionally, even though there are indications noting when individuals were not employed for a full season, the documents used to gather data do not indicate how much of the season an individual received a salary.

The “Musician Base Salary” figures do not include any additional payments offered by some organizations such as voluntary outreach services, and minimum overscale and/or seniority payments, all of which are more common for ICSOM musicians as opposed to their ROPA peers. Finally, these figures do not include any of the opera or ballet organizations which are members of ICSOM or IGSOBM.

Top Men

How Things Compare To Last Year

  • According to these figures, the average ICSOM executive director earns 398% more than an average ICSOM base salary musician.
  • Compared to the figures from the 2002-2003 season, the average ICOSM executive director’s increase in compensation was cut nearly in half, down from 10.61% to 5.81%. Nevertheless, even with this reduction they still managed to outpace the average ICSOM base salary musician who saw their increase in compensation fall from 3.83% down to 0.76% from 2002-2003 to 2003-2004.
  • For the first time in the history of ICSOM executive directors, one individual’s compensation exceeded the $1,000,000 mark.

Who Earns The Most?
These numbers were thrown off a bit due to the executive shuffle syndrome for this season. For example, the Cleveland Orchestra paid out $1,722,416 for chief executive leadership. However, that figure is divided between two individuals; outgoing executive, Thomas Morris, received $1,350,034 and incoming executive, Gary Hanson, received $372,382. Nevertheless, here’s the breakdown for 2003-2004:

  1. Cleveland Orchestra’s Thomas Morris earned $1,350,034
  2. Los Angeles Philharmonic’s Deborah Borda earned $839,169
  3. New York Philharmonic’s Zarin Mehta earned $763,110
  4. Atlanta Symphony’s Allison Vulgamore earned $542,437
  5. Boston Symphony’s Mark Volpe earned $462,043

Who Gained The Most?
Due to the large number of executives moving in and out of positions, this category isn’t exactly an exercise in precision. For example, you might have noticed that the average percentage increase/decrease for executive directors in the chart above was left blank. Nevertheless, it is still possible to identify some of the executives who earned sizeable gains for the 2003-2004 season:

  1. The Saint Paul Chamber Orchestra increased executive compensation by 30.27%
  2. The Colorado Symphony increased executive compensation by 28.31%
  3. the Atlanta Symphony increased executive compensation by 16.29%
  4. The Los Angeles Philharmonic increased executive compensation by 12.61%
  5. The Honolulu Symphony increased executive compensation by 10.00%

A Curious State Of Affairs In Saint Paul
Among all the changes in executive compensation during the 2003-2004 season, perhaps the most curious situation occurred in the Saint Paul Chamber Orchestra (SPCO). From the 2002-2003 to 2003-2004 season, the SPCO cut its total expenditures by nearly 10% ($961,610 to be exact).

One category that suffered the most from those cuts was the musicians as their base salary plummeted from $65,740 to $55,060. Nevertheless, their long time president and managing director (a.k.a. executive director), Bruce Coppock, received the largest percentage increase in pay out of all ICSOM executive directors for this particular season.

This seemed like a peculiar situation that warranted going back over the base musician salary and executive compensation figures for a few years prior to the 2003-2004 season to see how things have changed over that time. The charts below show the changes in executive compensation and musician base salary as well as the percentage increase or decrease from the previous season (although not listed in the corresponding chart, the compensation and base salary figures from the 2000-2001 season needed to complete the percentage increase listed in 2001-2002 column are $226,024 and $59,394, respectively):

The data indicates that there was no leap in base musician salary similar to that experienced by their president and managing director in the 2003-2004 season prior to when the organization began to experience severe financially difficulties. Nevertheless, the SPCO’s executive administrator accepted a $72,968 increase in compensation at that same time when the musician base salary was reduced by $10,680.

The chart below illustrates the SPCO’s change in executive compensation and base salary from the 2000-2001 to the 2003-2004 season

It will be interesting to see what is in store for the SPCO’s figures from the 2004-4005 season (which will be reported here around June, 2007).

Conclusions
The 2003-2004 season proved to be a fruitful year for ICSOM executive directors. Although the average increase in ICSOM executive compensation wasn’t as much as in previous years (some of which witnessed double-digit growth), they still managed to stay far ahead of the rate of inflation. In fact, there was only one executive director who worked a full season and earned less than $100,000 (Alabama). Furthermore, Total Ensemble Expenditures for the 2003-2004 season grew at a rate of 2.61%.

Based on all of those terrific figures, one might think the business did very well in that season to reward so many executives. Nevertheless, that wasn’t necessarily the case. For example, the average ICSOM Musician Base Salary decreased, perhaps the first average decrease in a decade or longer, by -0.02%. Additionally, the change in average ICSOM Musician Base Salary from the previous season was at the slowest rate of growth in over a decade (0.73%).

Consequently, it will be interesting to see how the average ICSOM Music Director and Concertmaster compensation stacks up in the remaining 2006 Adaptistration Compensation Report articles this week.

In the end, the 2003-2004 season is far enough in the past that most organizations should be able to have enough hindsight to determine if these executive increases have produced the comparable results most executive board members must have hoped would come about. Once again, much of the discussion surrounding executive compensation boils down to value and accountability; all of which were initially presented in the ROPA Executive Director report’s concluding section.

About Drew McManus

"I hear that every time you show up to work with an orchestra, people get fired." Those were the first words out of an executive's mouth after her board chair introduced us. That executive is now a dear colleague and friend but the day that consulting contract began with her orchestra, she was convinced I was a hatchet-man brought in by the board to clean house.

I understand where the trepidation comes from as a great deal of my consulting and technology provider work for arts organizations involves due diligence, separating fact from fiction, interpreting spin, as well as performance review and oversight. So yes, sometimes that work results in one or two individuals "aggressively embracing career change" but far more often than not, it reinforces and clarifies exactly what works and why.

In short, it doesn't matter if you know where all the bodies are buried if you can't keep your own clients out of the ground, and I'm fortunate enough to say that for more than 15 years, I've done exactly that for groups of all budget size from Qatar to Kathmandu.

For fun, I write a daily blog about the orchestra business, provide a platform for arts insiders to speak their mind, keep track of what people in this business get paid, help write a satirical cartoon about orchestra life, hack the arts, and love a good coffee drink.

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6 thoughts on “2006 Compensation Report: ICSOM Executive Directors

  1. This can be a tough one. While fairness is certainly an issue, so is competence and what boards have to pay to hire and retain talent. The market is different for EDs, just as it is for music directors. And a $50,000 raise costs the board less than a few bucks in each orchestra member’s pocket. In Atlanta, we were somewhat incensed that Alison V. was SO well compensated, in a year that we had taken a freeze. Indeed, when the news broke (in the paper) she was concerned about the perception enough to call a meeting with the Committee to discuss it. We found out that some of that $ was deferred compensation over several years, including vacation pay that the board insisted she take, a good chunk was for her tireless work (amounting to a second full-time job) on the Symphony Center project (from separate funding sources), and she is a large donor to the organization. I don’t personally care what they pay her as long as she can keep the organization thriving and meet our demands at the bargaining table. I’d rather have a $500K exec. dir. who knows what the hell is going on than a $100K one who doesn’t.
    Still, the article is interesting, and it shows that boards should be sensitive to the perception that the “stars” of the organization should be richly rewarded whilst the grunts in the trenches (I include your average staff member here as well) aren’t, ESPECIALLY when cuts are involved. The concept of equality of sacrifice remains an important one.

  2. One ICSOM orchestra was omitted, the San Antonio Symphony. While the musicians were unemployed for the entire 2003-04 season due to the orchestra’s bankruptcy, the management was not. The orchestra’s Form 990 shows $50,000 in compensation paid to the President/CEO and $51,343 paid to the former CEO, who was retained that year in a consulting capacity. This issue was addressed at the time in Adaptistration.

  3. Good points from Michael Moore. Is there a reason why 2004-2005 data wasn’t used? It must be available to ROPA and ICSOM orchestras plus by looking at http://www.guidestar.org. or http://www.charitynavigator.com.

    I also wouldn’t assume that an “expense account” necesarily benefits the e.d. the same as cash. That could be the use of a company credit card to take contributors (or potential contributors) or a guest soloist to dinner or reimbursing for the use of a personal automobile for orchestra business.

  4. XyloGuy: the compensation reports from the 2004-2005 990’s are due to be published around June, 2007.

    Bartleby: You are absolutely correct, I completely forgot to include the San Antonio Symphony this time around. As such, l will include the San Antonio figures in a special article that will be available beginning this weekend for weekly email summary subscribers only. if you don’t subscribe already, you can still sign up before I send out an email with the special article link – sign up here: http://trimurl.com/DW4

    I will certainly remember to include them in the 2004-2005 reports!

  5. I would like to comment on behalf of The Saint Paul Chamber Orchestra regarding Mr. McManus’ article titled “2006 Compensation Report.” It is appropriate to have discourse about compensation in our industry — including the relationship between compensation and results, as well as executive compensation versus musician compensation. The quality of this discourse will be directly correlated to the quality of information used to frame the discussion, however.

    Mr. McManus has played fast and loose with the facts. Despite the fact that the SPCO was singled out in the article, we never received so much as a telephone call or email asking us to shed light on what lies behind the numbers prior to publication – not to mention the fact that he doesn’t even appear to have read all of the information on our 990 regarding executive compensation. It is an interesting way to frame a serious discussion.

    To his credit, Mr. McManus has covered his presentation in caveats about the potential inaccuracy of his information, though this does not deter him from drawing unequivocal conclusions. In the case of the SPCO, Mr. McManus notes that our President Bruce Coppock’s compensation increased between 2001-2002 and 2003-2004 by $69,933, while during this same time period the base pay of the musicians decreased by $7,640. If Mr. McManus would have read the statement attached to the Form 990, (referenced in bold script next to Bruce Coppock’s name on the form and fully accessible via the web), he would have learned that in 2003-2004, Mr. Coppock received $104,927 of deferred compensation as part of his employment contract which was agreed to in September of 1999. In other words, when Mr. Coppock signed on with the SPCO, the Board agreed to a one-time payout if he remained in his job for five years. In terms of his salary, Mr. Coppock actually took a $34,994 cut along with a suspension of pension benefits in 2003-04 as part of an overall reduction in SPCO expenses that included a significant reduction in staff and a reduction in the musicians’ base pay.

    The implication made by Mr. McManus — that Mr. Coppock’s salary increased by $72,968 while musicians were taking pay cuts — is fallacious. The fact is that Mr. Coppock volunteered to reduce his salary before the musicians were asked to consider a pay cut. In addition, in the year that the 990 reports that Mr. Coppock took a $34,994 pay cut, he made a $25,000 personal contribution to the SPCO’s Annual Fund.

    It is important for our industry to have real discussions about executive and musician compensation, but we should ensure the discussion is based on fact.

    Jon Limbacher, Vice President for Development and External Affairs, The Saint Paul Chamber Orchestra

  6. I appreciate Mr. Limbacher taking the time to post a comment about the SPCO component to today’s report. However, in response to his accusations that the figures presented in this report are “fast and loose” or are incomplete is inaccurate. Furthermore, the above article does not present or imply conclusions of any sort. Instead, it presents information publicly available and provided directly from the organization accurately and unaltered. Furthermore, it details exactly which information from the respective documentation is included and excluded.

    In fact, in Part V of the SPCO’s 2003-2004 IRS Form 990, Mr. Coppock’s “compensation” listed in Column C is $305,179 and “contributions to employee benefit plans & deferred compensation” in Column D is $ 8,804. The $104,927 Mr. Limbacher refers to in his comment is listed in Statement 22 (page 23) as “non-qualified deferred compensation”. That statement goes on to say that as of the filing date, there has only been enough drawn from the trust holding the $104, 927 to pay the applicable income taxes; nevertheless, the exact figure drawn is not provided. As such, the SPCO’s 2002-2003 IRS Form 990 reports Mr. Coppock received $221,966 in compensation and the SPCO’s 2003-2004 IRS Form 990 reports his compensation as $305,179. Consequently, there is no indication of a reduction in compensation for the 2003-2004 season in either document.

    However, by contrast, the Cleveland Orchestra’s 2003-2004 IRS Form 990 provides a great deal of unequivocal documentation to clarify executive compensation. It lists Mr. Morris’ “compensation” as $655,836 and “contributions to employee benefit plans & deferred compensation” as $694,198 (which combined equal $1,350,034, the figure listed above in the report). Furthermore, Cleveland’s IRS Form 990 includes the following explanation for Mr. Morris’ deferred compensation: “the compensation and benefits information reported for Mr. Morris include lump sum payments of deferred compensation and supplemental retirement benefits, attributable to current and prior years’ service.”

    Nevertheless, discovering the sort of information provided by Mr. Limbacher is precisely the sort of material these reports should entice. As such, the Adaptistration Compensation Reports are an excellent example of how this process works. If stakeholders take the time to investigate the information contained within the SPCO’s reported IRS Form 990 (available at guidestar.org) and the musician salary information (available at icsom.org) they will discover that it is precisely the same information provided in the above report. As such, there was no need to contact the SPCO, or any of the ensembles included in or singled out in the 2006 Compensation Reports as there is no reason to believe that the information they reported to the IRS is erroneous.

    Consequently, unless orchestras enjoy the prospect of answering a slew of individual inquires asking about information contained in the aforementioned public documentation or experience lowered donations for reasons unknown, it is in their best interest to offer as much institutional transparency as possible regardless if it is required by tax documents or not.

    The fact that the SPCO, along with any reader, has an unedited venue such as this to present additional information beyond what they publicly release is what makes the blogging platform so unique and special, not to mention is something rarely found in traditional print media. In fact, both the SPCO administration and elected musician representatives were notified of the article and received a personal invitation to present precisely the sort of information Mr. Limbacher submitted in his comment. Although I’m disappointed Mr. Limbacher may find the freedom and methods offered with this platform unpalatable and/or uncomfortable, I am nevertheless happy to offer it. Perhaps most importantly, I am pleased that he was able to benefit by taking advantage of it.

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