There have been a few stories along these lines:

“According to Mozilla’s 2006 financial records…last year collected $66 million in revenue. Eighty-five percent came from a single source – Google. But, despite a pledge to use Firefox revenue to support new open-source projects, the foundation gave away less than $100,000 in grants, according to the audited statement, or $287,000, according to Mozilla, in 2006. In the same year, it paid its chief executive, Mitchell Baker, more than $500,000 in salary and benefits.”

Those numbers seemed out of whack, so I read a little more on the Mozilla site and financial report. Two points to consider from the Mozilla 2006 Financial FAQ:

“We planned 2006 spending on a conservative basis to make sure the Foundation remained sustainable amid the growth and change of becoming a much larger project. This meant we planned to spend income but not the basic principal of the Foundation in 2006 and perhaps 2007, until we have a good plan for the appropriate programs to put in place, and the people make good programs happen. It turned out that our investment income was greater than budgeted in 2006 as well.”

“Mitchell Baker’s 2006 salary is over-stated by 20%. The amount reported in the Form 990 includes approximately $100,000 for a salary increase and one time bonus for 2005 that was not finally approved and paid until 2006.”

Let’s start with Mitchell’s salary. Why is that a huge concern? A friend of mine works for Doctors Without Borders (MSF). He told me that his UN counterparts make more than MSF employees, but that the UN field employees deserve it. The higher pay attracts higher quality people (amongst the people who are in it to help humanity). Many CEOs make far more than Mitchell and produce far less in terms of social or financial “good” for their organizations.

Next, increasing the Mozilla Foundation’s asset base by ~50% (from $52M to $74M) is a smart thing to do while their deal with Google is still in place. The deal expires next year. It’s better for the Mozilla Foundation to save now and be in a position to spend later even if the Google deal becomes less lucrative, or goes away, in the future. Would it have been wiser to fund random OSS projects just because there was cash available?

Give Mozilla more credit…these guys and gals rock and do good for us all.