Charities Fear New Pay Limits Will Hurt Executive Donations
Many New York-area charities depend on both big gifts from executives and smaller donations from mid-level bankers to fuel their operations. The deepening recession has already trimmed revenue for these charities just as demand for services skyrockets.
"I hope we don't vilify everybody in the financial services sector," says Lisanne Finston, the executive director of Elijah's Promise, a New Jersey soup kitchen. Ms. Finston depends in part on Wall Street bankers' bonuses to fund her operations. She says her donations for food programs, typically $400,000, fell 19% last year, while the number of meals served jumped by about 15,000, or 15%.
Wall Street's biggest players have been among the largest benefactors for food pantries, antipoverty initiatives, museums and universities. Many declined to comment on their gifts or whether they may reduce them. Recipient charities, too, often are reluctant to discuss donors for fear of upsetting benefactors.
But many big Wall Street donors funnel money through private foundations, which must document annual grants through tax forms that offer a window into their charitable habits.
Morgan Stanley Chief Executive John Mack and his wife gave more than $8.6 million to charity in 2007 through their family foundation, according to the latest tax documents. Their gifts have gone to hospitals, historic preservation and charities aiding inner-city poor.
Morgan Stanley received $10 billion in federal assistance last year after its stock-price tumbled amid broader market fears. The year before, Mr. Mack received an $800,000 salary and realized about $8 million in exercised options. He hasn't taken a bonus in the past two years. He declined to comment through a spokeswoman.
Top executives at other banks that have received aid have also given at least several hundred thousand dollars to charity annually in recent years, including Goldman Sachs Group Inc. Chief Executive Lloyd Blankfein and J.P. Morgan Chase & Co. Chief Executive James Dimon. Spokesmen for Messrs. Blankfein and Dimon didn't return messages seeking comment.