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September 21, 2020

Executive Compensation at the National Grocers Association

by Anne Paddock

The National Grocers Association (NGA) sounds like a big organization but, in reality, NGA is a small non-profit, tax-exempt trade association that represents independent supermarket operators across the country. This 501 (c) (6) typically raises about $7 million annually (primarily through convention/conference fees, membership dues and royalties) and spends slightly less (primarily on compensation, travel and conferences, and office expenses). At year-end 2017, NGA had $11 in net fund assets.

Even though NGA is a small trade organization based in Arlington, VA, putting the spotlight on this organization is important because of board member composition (most are male and some are employed by big corporations (Coca-Cola, Unilever, Piggly Wiggly, and PepsiCo), the President and CEO of NGA received more than $800,000 annually in compensation (for several consecutive years), and the three most highly compensated employees are all male.

The Form 990 (2017) submitted to the IRS reports there are 55 board members, 43 (or 78%) of whom are male while 12 (22%) are female.  30 employees were compensated $3.3 million, which equates to an average compensation of $110,000. However, only 7 employees received more than $100,000, which means the employees at the top were well compensated:

  • $842,010:  Peter Larkin, President and CEO
  • $295,704:  Mathew Ott, COO
  • $288,307:  Gregory Ferrara, SVP
  • $145,271:  Corinne Routhier, VP
  • $144,009:  Karen Voorhies, Director
  • $143,330:  Laura Strange, VP
  • $122,270:  Elizabeth Crocker, VP

The 7 employees above were compensated $2 million. If the 7 most highly compensated employees and their respective compensation were excluded from the total numbers, then 23 employees were compensated $1.3 million, or an average of $56,500.

Although 4 of the 7 most highly compensated employees are female and represent approximately half of the most highly compensated employees, their compensation was significantly less than the three males who were most highly compensated.  In fact, the compensation of all four female employees collectively is less than the compensation to Peter Larkin (a male), the President and CEO. The 3 most highly compensated employees (male) received $288,307 – $842,020 while the 4 most highly compensated females received $122,270-$145,271.  What is most striking is the compensation of the President and CEO who received $840,010 in 2017 (note: In 2016, Mr. Larkin received $836,686 and in 2015, he received $798,702 in compensation).  How can a small trade association that only raises about $7 million annually justify paying more than 10% of its total revenue to its President?

NGA paid for companion travel and provided tax indemnification and gross up payments. Specifically, NGA paid for the travel of companions for staff officers to the annual convention and other meetings. Tax indemnification and gross up payments were provided to the president of the organization.

NGA is the direct controlling entity for two related organizations:  NGA Research and Education Foundation, a 501 (c) (3) that operates out of the same office as NGA; and NGA PAC, a 527 that also operates out of the same office as NGA.

4 independent contractors received more than $100,000 in compensation:

  • $666,453:  MGM Resorts International of Los Angeles, CA for events
  • $182,783:  Leading Authorities of Washington, DC for AV production
  • $176,630:  Anderson Robertson Marketing of Findlay, OH for marketing
  • $144,047:  Cornell University of Ithaca, NY for program housing

To read the From 990 (2017) for NGA, click here.

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