|August 1, 2011|
|PRSA COO's 3 Years = $3M+; Questions Blocked on Call|
|By Jack O'Dwyer|
|PR Society of America has made a commitment of at least $3 million by giving COO Bill Murray a three-year contract to the end of 2014.|
Murray, whose blacklisting of the O’Dwyer Co. delivered in person by him in our office is a violation of the Society’s Ethics Code, will no doubt keep his two chief hires — CFO Phil Bonaventura and VP-PR Art Yann.
COO Bill Murray
Murray’s pay/benefits as of 2009 totaled $373K while Bonaventura received $221K in pay/benefits and Yann got $137K in pay alone (benefits not revealed).
Since PRS traditionally gives a year’s severance to departing execs, total projected tab is four times $731K or $2.92M (not including raises).
This huge outlay comes at a time when the Society says it “desperately” needs a $30 dues hike to continue and improve services to members.
Although federal law requires associations to tell members how much their top staffers make, the release on Murray said: “Financial terms of the contract were not disclosed.”
Pay information is required in IRS Form 990 but PRS files this late in the year and it’s not electronically available until early the next year (two years after the fact).
Members will have to wait until early 2012 to find out (in convenient web form) what Murray and other execs made in 2010. The 990s were withheld from the 2009 and 2010 Assemblies.
The 2010 Form 990 was initially due May 15 but extensions can postpone this to as late as Nov. 15. PRS won’t say when the 990 will be filed.
Q’s Blocked; Assembly to be “Dis-Assembled”
The two teleconferences July 28 for delegates and leaders were marred by two horrors — audible questions were banned from the p.m. session and chair Rosanna Fiske announced the 2011 Assembly would be “dis-assembled” — broken up into a dozen or more chat groups.
[Editor’s Note: This website has a record of everything said on the two conference calls but did not “hack” into them in any improper way; numerous members feel the calls should be public record since PRS says it speaks for the entire industry; members have every right to describe the conferences to anyone].
The a.m. session included a question by Laura Neff-Henderson, president of the Blue Ridge chapter, on the high pay of PR staffers as described by this website. Fiske refused to discuss the topic and told Neff-Henderson to call her back for a private discussion.
Salary/benefits of PRS staffers totaled $5,529,699 in 2010, a gain of 3%, or 52.5% of revenues of $10,513,366. They rose 8% in the first quarter of 2011 to $1,390,314, or 57% of revenues of $2,249,824 (which were up $14,457 while expenses rose $101,269 to $2,249,139). 2Q financials have yet to be revealed.
J.R. Hipple, a member of the task force on the dues hike, told the conference that there was a “pay freeze” but did not mention it was only for 2009.
Pay/Fringes Less at Other Groups
The dues hike committee, which said it looked at whether other groups were raising their dues, should look at the percentages spent on pay/fringes of h.q. staffers of the major professional associations.
The American Bar Assn., as of 2008 (latest report publicly available), spent $61,477,433 in pay/benefits of staffers from income of $148,492,260, or 41% of revenues.
The National Investor Relations Institute, a peer association of PRS, gave 39% of its revenues to staffers in 2008 ($2,240,082 of revenues of $5,738,140) but this rose to 47.6% in 2009 because of the recession ($2,274,900 of revenues of $4,772,934).
The American Institute of CPAs pays between 35-40% of revenues to staffers. Pay/fringes were $67,591,960 in 2007 on revenues of $209,426,998 or 32% of revenues but rose to $98,492,054 of revenues of $199,806,139 in 2009 or 49% of revenues.
Reason for the jump was that AICPA reported only $3.8M in pension contributions in 2007 but $30.5M in such contributions in 2008.
In 2006, $65M was spent on the staff on revenues of $194M or 39%.
Murray Is Eloquent on “Ethics”
Murray waxed eloquent in both the a.m. and p.m. sessions on the importance of ethics to Society members.
He told the a.m. session that the Code of PRS is the “best example” of one of the “intangible” services that the Society provides to members—“an embodiment of our values…our aspirations as professionals...a living thing that we provide” including standards.
In the p.m. session, Murray described the Code as “a great example of an intangible benefit” provided to members, “not a thing that you can touch and feel, it’s really our values as a community.”
A survey of members, he said, found that “one of the most important things they get is the Code of Ethics.”
He praised the volunteers and the members of the Board of Ethics for answering questions and providing guidance on a day-to-day basis.
Murray also emphasized the importance of the “Business Case for PR” which describes PR to various audiences and described other benefits of PRS including its online PR Journal, the job website, publications, awards program and forums for discussions and networking.
PRS, Murray said, provides “a smorgasbord of different types of benefits” on the national level as well as on the local community level (chapters, sections and districts).
PRS spent $2,649 on “Ethics” in 2010 and $2,891 on it in 2008. It is the smallest item in the budget. There is no program in which PRS leaders or staff publicly appear to discuss PR or the Business Case for PR or take questions from reporters.
Leaders Talk for 40 Minutes
As is usual with Society teleconferences and Assemblies, leaders took up most of the time with their own presentations.
At the p.m. session, Fiske talked for the first 14 minutes; conference co-chair Bonnie Upright talked for six minutes; Hipple for 13 minutes, and Murray for seven minutes.
Only at 40.29 minutes of the p.m. session were questions allowed and none of them were allowed on mike.
Fiske said delegates could only submit questions by typing them into a “chat box” on a website that was set up as a companion to the teleconference.
This eliminated the chance for anyone to raise questions about the high pay of staffers as reported by this website as was done by Neff-Henderson at the a.m. session.
The ban on “live” questions is but the latest of numerous impediments to communications that have appeared in the past several years at PRS.
The list of national delegates has not appeared since 2005 and delegates have until Aug. 15 this year to identify themselves; transcripts of Assemblies stopped in 2005; the single list of chapter presidents was removed last year as well as the names of 47 h.q. staffers; this year the phone numbers and addresses of national directors were removed from the PRS website.
Reporters are not allowed to see the audit of the Society nor the quarterly financial reports. Leaders and staff refuse to take questions on the financials.
Members themselves are threatened with legal action if they so much as e-mail to someone else certain materials on the PRS website including
the audit or make more than one copy of an e-group posting.
The repressive atmosphere of a police state cultivated by leaders and staff is the opposite of PR’s promise of openness and talking things over.
Treasurer Tate Inexcusably Absent
Phil Tate, serving an unprecedented two years in a row as PRS treasurer and chair of the Business Model Task Force studying the need for a dues hike, was not on either call.
He obviously should have been even though he may have been traveling, as one of the calls was told.
Tate, based in Charlotte, N.C., is one of the numerous Southerners who dominate both PRS and the Universal Accreditation Board,
Two Southerners competed for PRS chair-elect this year—Mickey Nall of Atlanta and Dave Rickey of Birmingham. Co-chairs of the UAB are John Forde of Mississippi State and Jay Rayburn of Florida State. Four of the six new appointees to the UAB board this year are Southerners—Susan Barns, Nashville; Adam Bashaw, New Orleans; Barbara Burfeind, Alexandra, and Elizabeth McMillan, Atlanta.
Also appointed to represent the Florida PR Assn. was Kathleen Giery of Gainesville.
Head of the APR marketing task force is Michael Tullier of Aurburn, Ala.
Cheryl Ball, Knoxville counselor, is audit chair. She is not on the national board as required by Sarbanes-Oxley, to which PRS says it is “committed.”
When current chair Rosanna Fiske ran for chair-elect in 2009, she was opposed by another Southerner, Leslie Backus of Davie, Fla., which is about 20 miles from Miami, where Fiske is based.
Ethics Board chair is Tom Eppes of Chapel Hill, N.C.
The list of the chairs and co-chairs of the nearly 25 committees on the PRS website shows many with Southern locations.
Tate Said Alternatives Exhausted
We think the reason Tate did not show up is that he posted a memo on the PRS website June 6 that said the Society has “tried over the past decade to diversify its non-member revenue resources, including the appointment of a non-dues task force in 2009 to identify alternate means of generating income. That task force concluded that the Society was not missing any practical opportunities to generate non-member income.” ?
That hopeless attitude is not what leaders wanted on the two conference calls July 28.
So instead of Tate, leaders inserted Hipple, who said PRS will continue to explore other possible sources of revenues.
PRS Is “Desperate,” Says Hipple
Hipple, who gave lengthy, impassioned pitches for the dues hike in both the a.m. and p.m. sessions, told the a.m. session that PRS “desperately needs the financial resources” so it can continue to “lead the industry.”
Hipple, saying, “We are the leaders,” said PRS “leads the profession best by serving its own members.”
“We absolutely cannot sit back and not continue to lead. We desperately need the financial resources to do that,” he said.
He noted that PRS cut $1.5 million from its spending.
It had to do at least that since revenues declined from $12,255,543 in 2007 to $9,989,101 in 2009 and to $10,513,366 in 2010.
PRS was saved from the loss column in 2010 because it made $222,599 in the stock market, Hipple noted.
The Society has nearly $1 million riding in the market.
Intense Competition Cited
Hipple said that whereas PRS once had a lock on PR training, it now has numerous competitors including other PR groups and trade publications.
Chapters are having a tough time renewing members and especially senior members and the same thing has taken place at the Counselors Academy of which he is chair, he said.
“We have a fall off of grey hairs” at the Academy, he said.
“We really want to be leading the profession,” he added, “really be the best of class.”
He described PRS as “a mature brand that needs to be re-invested in.”
Hipple praised the absent Tate and Bonaventura (who was present) as “really humble but fine guys” who are leading the quest for more income for PRS.
Hipple said he has been a member of the Society since college and said “our members are difficult…our governance system as a democracy is a difficult system to manage from an association standpoint.
However, he was buoyed by the fact that surveys show that the Society “scores above 80% in customer satisfaction” despite cutting finances and cutting staff.” Volunteers have stepped into the breach, he said.
Hipple, who heads Hipple & Co. Reputation Management, Atlanta, last year was named chairman of the board of governors for the Center for Ethics and Corporate Responsibility, Robinson College of Business, Georgia State University.
He has been on the Ethics board since 2006 and recently was chair of the 2009 Ethics Advocate Award.
We tried to talk to Hipple by telephone since he is an expert in ethics.
He answered the phone but almost immediately hung up, pleading urgent business.
He promised to call back but never did.
Bethard-Caplick Worries about Hike
Delegate Debra Bethard-Caplick, president of the Suburban Chicagoland chapter, which has about 70 members, was the first questioner on the p.m. session. Her question was read by a PRS staffer since voice questions were not allowed.
Debra L. Bethard-Caplick
Bethard-Caplick said the $30 increase “may be the proverbial straw that breaks the camel’s back.” Members are “strapped for cash,” she said.
She also wondered what members get “above and beyond their dues.”
Fiske said she was not sure what Bethard-Caplick meant and urged her to go to the delegates’ “tool page” for a description of all the benefits of PRS.
Another questioner asked if chapter dues, like national dues, could be paid quarterly.
Fiske said chapter dues are collected in full at the beginning of the year and sent to chapters on a monthly basis. A “piece meal” approach is not feasible, she said.
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