Austin Women Are Underrepresented in Nonprofit Executive Ranks

By Lucy White

Photography By Lucy White

Reporting Texas

Six of the 25 largest Austin-area nonprofits had women as CEOs in 2015. The disparity between average salaries for those men and women amounted to more than $107,000, with women earning 63 percent of what the men made.

These findings are a result of a Reporting Texas analysis of 2015 tax filings — the latest year for which complete data was available — maintained by GuideStar, a national reporting organization on nonprofits.

“Being paid a fair salary for the work we do is critical,” said Patsy Woods Martin, executive director of Annie’s List, an Austin nonprofit that promotes progressive women candidates for elected office in Texas.

Women make up the majority of nonprofit employees nationwide, but they are vastly underrepresented in top leadership positions at organizations with the largest budgets. Only one in five executives nationwide are women at nonprofits with budgets exceeding $50 million, based on a 2017 compensation report by GuideStar.

Many nonprofits serve diverse communities, promoting missions that advance equity and inclusivity. And as studies have shown, the more diverse the group, the better it performs. But nationwide there is a gap in median CEO compensation for men and women at organizations of every size, according to the GuideStar study, also based on 2015 data. Between 2005 and 2015, the gap increased in some categories. The disparity becomes more pronounced the larger the budget, according to GuideStar’s report.

The gender pay gap in Austin is twice as high as the national trend among organizations with budgets exceeding $50 million, Reporting Texas’ analysis found. In 2015, only one of those nine organizations was run by a woman—Rhonda Mundhenk of Lone Star Circle of Care. Mundhenk made $294,670, almost $500,000 less than the top-paid man; her organization had roughly one-third the budget of the largest in this category.

Woods Martin said when women are married and have children, the higher-paid spouse often stays in the workforce. If women are paid more, they will be more likely to stay and grow into executive roles, Woods Martin said.

“Seeing more and more women in leadership positions encourages women to strive for that,” she said.

The highest-paid CEO among Austin-area nonprofit organizations, Juan Sanchez at Southwest Key Programs Inc., made $770,860 in 2015, according to GuideStar’s data. Sanchez defended his pay as appropriate given the size and reach of the organization.

“If there was a woman in my position, I would expect that she get paid as much as I do,” he said.

When Mundhenk in 2014 took over Lone Star Circle of Care, a health care services provider for low-income people, the organization was in “freefall,” and no one expected it to survive, Mudhenk said. She was tasked with saving and restructuring Lone Star to preserve core services. Since she began, Lone Star has emerged stronger, excelling in every metric, she said.

“You’ve got to be willing to do it all,” said Mundhenk, who starts her days at 4 a.m. “You can’t think you’re beyond anything or you’ve passed anything that’s beyond your pay grade. I have literally taken out the trash at our company picnic.”

Mundhenk believes that her diverse team is essential for Lone Star’s success, pointing to the pitfalls of blind spots from groupthink.

“We’re too good at convincing ourselves that we know it all, so it helps to be challenged by someone with an alternate perspective.”

Several recent studies show that more diverse teams produce better outcomes. According to “Diversity Matters,” a 2015 report by McKinsey & Company, publicly traded companies in the top quartile for gender diversity tend to outperform their competitors. The study analyzed 366 public companies across a range of industries in Canada, Latin America, the United Kingdom and the United States.

Nonprofits such as Lone Star have a substantial role in supplementing government and private services. The largest 25 Austin organizations spent over $1 billion in 2015, affecting health care, education, low-income housing, senior care and other issues.

Many nonprofits are working on diversifying boards, but leaders in the community are unaware of any organized effort to specifically address the gender disparity in top staff positions.

Influencing change

Austin’s Mission Capital helps advise other nonprofits in leadership hiring and salary choices. It is not currently working on gender equity and inclusion, according to director of marketing and communications Kristina Thompson. Mission Capital is in the middle of a strategic planning process and hopes to  work on the issue in the future, she said.

Although a future Mission Capital initiative could drive change in the industry, organizations also are responsive to their funding sources. For instance, foundations looking to award grants to nonprofits sometimes ask for board diversity information as a factor in their decisions.

But individual donors may be unaware of any gender inequities when they choose organizations to support. Beginning March 1, local nonprofits will compete for donations during Amplify Austin, a 24-hour period of online giving that last year raised nearly $10 million. The organization I Live Here I Give Here puts on the annual event, encouraging donors to select organizations from a list of hundreds. They do not provide diversity metrics for donors, nor does GuideStar.

The lack of available information related to diversity is a challenge, especially for an industry that prides itself on transparency, said Catherine Lucchesi, director of communications and programming for I Live Here I Give Here.

For some observers, the lack of women in executive positions runs counter to the Austin narrative of progressiveness.

“We drink our own Kool-Aid way too much,” Leadership Austin CEO Christopher Kennedy said.

Women have been 60 percent of Leadership Austin’s flagship training program for the past seven years, according to Kennedy. Its current emerging leadership training program is almost 80 percent female. Given Austin’s strong economy, Kennedy said, community leaders should be held to a high standard on diversity issues.

“The moons are all aligned, the glass is half-full,” Kennedy said. “We have to call these questions and have these conversations.”

For Mundhenk, leadership has meant breaking the mold.

“The only thing you can do, and this is a point of vulnerability, is to put yourself out there and say, ‘This is who I am,’” she said. “I’m not going to sit around and pound on my chest.

“But you’ll be able to see the results of what the organization has been able to do, and that’s all that I need at the end of the day.”