Association Management: Interesting Things No One Tells You
Association management is wild and whackyâ€”thereâ€™s so much that no one tells you. Like walking into a glass door, some of the learning experiences can be unexpectedly jarring.
Episode 2: CEO Agreements: 5 Things to Get In Writing!
Want to be a CEO? Already a CEO and switching jobs? There are five components of your employment agreement that may be the most important to consider.
Keep in mind that thereâ€™s no silver bullet. As a CEO, you have to decide for yourself whatâ€™s most important for you and for your organization. Forget preprinted checklists-- every association situation and culture is different. Thereâ€™s no substitute for personal discussions with your associationâ€™s leadership, in order to explore and arrive at (and sustain) mutually agreeable terms. That said, hereâ€™s a brief look at the five key components:
1. Duties: What are the roles, duties and authority of the CEO? Is it clear the CEO is singularly responsible for staff, budgets, contracts, and other essentials? Can these duties be changed, and if so, by whom and how? Are changes (change of duties, change of role or authority, reorganization, merger, acquisition, cessation of operations, etc) considered as termination for good reason?
2. Compensation & benefits: What is the base compensation? What are the types of variable compensation, i.e., bonus, commission, etc.? Are additional types of compensation appropriate, i.e., one-time (moving, relocation, etc.) and/or recurring (car, travel, business club, etc)? Will compensation be established and maintained as â€œmarket rateâ€? How will that be determined annually? Who participates in the decisions? Do the associationâ€™s standard benefits packages apply to the CEO? How is annual performance planning and evaluation conducted?
3. Term & renewal: Is there a reasonable initial term of employment? When and how will the initial term be extended or renewed? Who participates in the decisions? What if there is no formal action to renew the termâ€”does it renew automatically, or is it considered involuntary termination?
4. Termination: How will (unfavorable) â€œtermination for causeâ€ be defined? How will other types of (favorable) voluntary, involuntary and for good reason terminations be identified and defined? How are the termination definitions linked to compensation, benefits and any special termination pay-outs, i.e., termination in first year of employment, termination after first year, involuntary termination, for good reason, etc.?
5. Restrictions: Are there personal or professional restrictions on the CEO while employed, and/or upon termination? For example, can the CEO teach, write, do research or other similar activities, while employed? Upon termination, can the CEO immediately work for another association in the same geographical area? Can the CEO immediately approach employees of her/his former organization about career changes?
Thinking about these key parts of your CEO employment agreement and reaching mutually agreeable resolution with your volunteer leaders will help to establish your credibility as a senior executive. It will also make your life a lot more enjoyable. Good luck!