Executive Compensation at the American Heart Association (2019)

The American Heart Association (AHA) is one of the most popular and recognized non-profits in the United States with enormous public support but 2018-2019 was not a great year for the organization.  Total revenue reported was down 12% to $746 million (compared to $852 million the prior year).   That the AHA has nearly a billion dollars in their net fund balance is also noteworthy.

By most accounts, this organization is a magnet for public contributions and an expert at raising and saving money.  But, are they accomplishing their mission, which is to build healthier lives, free of cardiovascular disease and stroke (especially with hundreds of recipes on their website calling for eggs, dairy products, beef, poultry, pork – including bacon, a Type 1 carcinogen according to the World Health Organization, oil, sugar and white flour)? With heart disease the number one cause of death in the United States for decades, one has to wonder if all the contributions to the AHA are really helping to prevent and reverse heart disease?

In 2019, revenue totaled $746 million with the primary source contributions, gifts, and grants.  Expenses totaled $756 million (not including $14 million in depreciation) with compensation as the largest expense for AHA.  4,434 employees received $366 million in compensation, which equates to an average compensation of $83,000.  440 employees received more than $100,000 in compensation with the 14 most highly compensated employees reported to be:

• $3,474,435:  Nancy Brown, CEO
• $  806,551:  Leslie Upton, COO
• $  769,303:  Rose Marie Robertson, Chief Science Med (thru 9/18 or 2.5 months)
• $  627,533:  Kathleen Rogers, EVP Western States
• $  591,744:  Meighan Vafa, Chief Marketing Programs
• $  582,588:  Midge Epstein, EVP Southwest
• $  527,776:  Larry Cannon, CAO, Corporate Secretary
• $  510,280:  John J Meiners, Chief – Mission – Align
• $  506,992:  David Markiewicz, EVP Southeast
• $  490,910:  Kevin Harker, EVP Midwest
• $  419,693:  Cynthia Roberts, CFO
• $  419,191:  Jeremy Beauchamp, EVP Mid Atlantic
• $  415,483:  Nicole Sapio, EVP Great Rivers
• $  334,332:  Lynne Darrouzet, Corporate Secretary (thru 10/17 – the previous fiscal year)

The 14 employees listed above were compensated $10.4 million, which equates to an average compensation of $743,000.  9 of the 14 (64%) most highly compensated employees are female while 5 (36%) are male. It is also important to point out AHA is managed by a Board of Directors with 23 independent members. 19 are listed on the Form 990 (Part VII). 15 of the 19 (79%) are male while 4 (21%) are female.

AHA paid for first class travel for the CEO, and the officers and board members.

AHA paid for companion travel for spouses or companions of officers of the organization.

AHA made gross up payments and tax indemnifications. See Schedule J, Part III, Supplemental Information on the Form 990 for more information.

AHA paid for health or social club dues or initiation fees. See Schedule J, Part III, Supplemental Information on the Form 990 for more information.

It is important to point out 184 independent contractors received more than $100,000 in compensation with the five highest reported to be:

• $9.8 million:  Production Solutions, Inc., of Vienna, VA for direct mail marketing
• $8.0 million:  Freeman Company, of Dallas, TX for audio/video
• $6.1 million:  Orora Visual TX LLC, of Mesquite, TX for printing
• $4.4 million:  Crispin Porter Bogusky, of Boulder, CO for marketing
• $3.7 million:  Blackbaud, Inc. of Austin, TX for web services

In summary, AHA faced a 12% decline in revenue during fiscal year 2018-2019. Yet, the organization paid the CEO $3.5 million and also paid for first class travel, companion travel, and other perks.  The 14 most highly compensated executives received more than $10 million in compensation. But, what is more disturbing is that this tax-exempt non-profit raises nearly a billion dollars annually, has nearly a billion dollars in net assets and yet, heart disease remains the number one cause of death in the USA.  Although AHA has been operating for nearly 100 years, maybe its time for the organization to re-direct their efforts to knock heart disease off the top killer in America.

To read the IRS Form 990 (2018 for the year ending June 30, 2019), click here.