Does it matter what the CEO of a charity is paid? - MoneySense

Does it matter what the CEO of a charity is paid?

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How much does the CEO at your favourite charity make? This year, for the first time, we included that information in our table. As you scan through the list, you’ll notice that many executives in the charitable sector make quite a lot. Salaries in the $250,000 to $300,000 a year range are common. The average top paycheque is $210,000.

We debated including this information because we know that some donors will find the salaries too high. When we showed the amounts to Carl Harvey, a retired accountant in Peterborough, Ont., who gives to more than 20 charities a year, he found the sums appalling. “Some guy in a corner office with a suit that I can’t afford is making hundreds of thousands of dollars,” he says. “The only defence they have is ‘Well, we need to pay to get quality people.’ Come on, people would work for a lot less than that.”

Still, keep in mind that many of the charities on our list are large, complex organizations. For example, World Vision, one of the largest charities on our list, had $374 million in revenue in 2009. Many are carrying out complicated missions such as delivering programs in developing countries or supporting sophisticated medical research. Paying an experienced CEO a six-figure salary to make such an organization as effective as possible can be a good investment.

Don McCreesh, chair of Imagine Canada, an organization that supports the non-profit sector in Canada, argues that staff at charities shouldn’t be treated like volunteers. “In the charitable sector, you get what you pay for, just like in the corporate sector,” he says. “If you want to have efficient, effective organizations, you need to have top people.”

While we didn’t use the salaries as a factor in our ratings, we did feel that it was relevant information to provide to donors. By publishing all the salaries together, along with other measures showing how well the charity is meeting various standards, we believe we’ve provided some context. It’s up to you to decide whether a given charity’s top salary is out of whack with other charities in its sector. Either way, even McCreesh believes that salary information should be public. “In the charitable sector, we need to be straight up about what the salaries are and why. We need to have a discussion about what the salaries should be,” he says.

We asked all 100 charities to disclose what their CEOs made in 2009. Only 18 charities did so (each received one bonus point in the Governance and Transparency category). For those that didn’t, we used amounts from tax filings or from the Ontario government public sector salary disclosure list. The amounts given as a range are from the Canada Revenue Agency. Those amounts represent the salary of the highest-paid individual at the charity, who is not necessarily the CEO.

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