The Charity Sleuths

What the Intelligent Giving researchers are uncovering, and whose turn it is to make the tea

Thursday, August 03, 2006

Sensitive CEO salaries

We have reviewed 500 charities and have decided to stop - for the time being - to check that our financial figures are correct. We have taken the diligent but difficult next step of asking each of the 500 charities to check we've got them right.

We are having many positive responses but one contentious issue keeps raising its head: the Chief Exec's salary.

For charities whose CEOs earn over £50,000 there have been no issues since those salaries are disclosed in the Annual Report in bands (e.g. £50,000 to £60,000). But for CEOs who earn less, we are getting a few indignant responses. This is because the majority of Annual Reports simply state, "No employee earns more than £50,000". Without an exact figure, all we can do is state that the CEO salary is below £50,000. But we are requesting the actual figure. And this is ruffling feathers.

Donors would doubtless like to know what the CEOs' salaries are, especially as they are paying towards them. But we've had several alarmed responses from the charities, saying that this is private information and... how dare we?

In phone conversations it quickly becomes clear that many of these charities don't realise that their accounts are already in the public domain on Guidestar and the Charity Commission Register. We are just presenting them in a way that is more accessible to the public.

As for the CEO salaries, we, as donors, want to know them and we can't easily understand why a handful of charities won't disclose them. Do they have something to hide?

For the record the CEO of Intelligent Giving gets £33,000 and he doesn't care who knows (he says).



Blogger Mikemuses said...

I don't think they've got anything to hide, but I think they think they have something to hide.

I believe that some charities, especially the smaller to middling ones, think that donors don't like the idea of charity bosses being reasonably paid.

So they try to keep it quiet. Of course this doesn't work, as when the charities hush it up, donors think there's something to hide, so it perpetuates itself.

Charities really need to come out and be proud that (if) they're paying a fair wage for a fair job, and concentrate on educating people about why it's fair (and necessary)

11:21 pm  
Blogger The Intelligent Giving Team said...

That's it - spot on. And I reckon the same applies to other information, especially admin costs, which are generally much lower than donors expect. The answer, surely, is to highlight these costs and... pleasantly surprise everyone!


9:20 pm  
Anonymous Simon said...

I don't believe that it's necessarily that the charities feel they've got anything to hide (though I wouldn't rule that out in some cases). I suspect it's more to do with British squeamishness about talking about money. Seriously, how many people even know what the person sat next to them at work earns - or even their best friend? It's just not done - you just don't ask that. Contrast it with an American view, where someone's salary might be one of the first things you ask them when you meet them at a party.

Perhaps it ties into some of the reasons why philanthropy is bigger in America. People there aren't afraid to say, "hey, I've got a bit more money than I need and I'm happy to give some of it away", whereas the British are a little... well, embarrassed about it all.

Have a look at the social anthropologist Kate Fox's marvellous book Watching the English (from which I have pilfered most of these thoughts).

10:42 am  
Blogger Mikemuses said...

A book worth reading, Simon. But I think there's more than just 'Englishness' at work here. We know how much top businessmen make. We know how much the people that run our companies our worth, and we know how much our politicians are paid (sorry, couldn't bring myself to use 'worth' or ''earn'). Charity salaries, however, make us come over all, English.

6:41 pm  
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1:00 pm  
Blogger Gary Socrates said...

With smaller charities, many of them, especially locally based ones, will have reluctance to let their users know how much staff are paid. At a local level, this often causes issues. Including in organisations' own committees who often think their staff are overpaid - which they aren't. Many people/users are under the illusion that all charity staff should be volunteers.

3:00 pm  

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