Some charities 'don't buy into' revealing senior executive pay, says chair of steering group

Rosie Chapman, who chairs the charity governance code steering group, told MPs in a personal capacity that the 'sunshine is the strongest disinfectant' argument doesn't wash with some charities

Rosie Chapman
Rosie Chapman

Some charities "do not buy the argument" for publishing senior executive pay, a meeting of the All-party Parliamentary Group on Charities and Volunteering has heard.

Rosie Chapman, independent chair of the charity governance code steering group, but speaking in a personal capacity, told a meeting of the APPG yesterday three issues had been raised with her informally by charities since the new governance code was published in July.

She said transparency, and specifically reporting executive pay, was one of those issues, despite the new code merely reflecting long-standing guidance issued by the National Council for Voluntary Organisations in 2014.

The NCVO recommends that charities should provide details of the exact pay of their senior executives in accessible places on their websites.

Chapman said some individuals in the charity sector had argued that providing the exact salaries for senior executives had driven up wages elsewhere because it "acts as a head-hunters’ charter".

She said: "The reaction by some charities to that is some people do not buy the argument for doing it," she said. "The ‘sunshine is the strongest disinfectant’ argument is not washing with some charities."

Chapman said one of the other issues was diversity. She said feedback she had received suggested that charities thought diversity on boards was an important issue, but many were nervous about how to make this a reality.

The third issue, she said, was how a charity’s board could help to drive forward the organisation, with the related issue of board dynamics, including regular reviews of trustees’ performance.

Chapman said that uptake of the previous code had been patchy, but this could be down to the code being voluntary.

Baroness Pitkeathley, the Labour peer who chaired the House of Lords Select Committee on Charities, which published its final report in March this year, said she hoped the report would help charities to improve, but warned that morale in the sector was currently low.

"Trust has undoubtedly been knocked in charities, there’s no doubt about that," Pitkeathley said. "My feeling is it is beginning to get better, but we can never take it for granted.

"Charities’ confidence in themselves is important in this regard, and I hope the report has gone some way to increasing the sector’s confidence in itself."

Pitkeathley said that all charities should have some way of measuring their impact on their beneficiaries, and that although she was keen to avoid burdening charities with excessive reporting, "they should be able to say what they have done".

Pitkeathley also provided an update on the government response to the report, which is normally due within three months of the publication of an ad-hoc committee’s report.

Because of the general election, which was announced shortly after the committee’s report was released, there has not yet been a government response to it, although Pitkeathley said she expected that to happen in October.

At the meeting, Pitkeathley, Susan Elan Jones, the Labour MP for Clwyd South, and the Conservative peer Lord Hodgson of Astley Abbotts were all reappointed as co-chairs of the APPG, Martin Docherty-Hughes, the SNP MP for West Dunbartonshire, was reappointed as vice chair and the Conservative peer Lord Shinkwin was reappointed as treasurer.

Jeremy Lefroy, the Conservative MP for Stafford, was appointed a co-chair, replacing Chris White, who lost his seat at the general election.

In 2013, Lefroy called for charitable status to be removed from charities that pay senior staff more than £100,000 a year, a proposal that was rejected by the then-charities minister Nick Hurd.

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