Pay gap 'damages third sector'

Charities are in danger of losing their credibility because of their "shocking" record on diversity and governance, according to Acevo's annual pay survey.

Charities are in danger of losing their credibility because of their "shocking" record on diversity and governance, according to Acevo's annual pay survey.

The report by the chief executives' body discovered that 97 per cent of chairs and 94 per cent of chief executives of third sector organisations are white. Seventy per cent of chairs are men.

Stephen Bubb, chief executive of Acevo, condemned the results as "truly shocking" and Hamish Davidson, chair of executive recruitment company Rockpools, which produced the report with Acevo, said the research "cast the entire sector in a very poor light".

Davidson added: "Some of this year's findings are unhelpful - and even potentially damaging. If as a headhunter I delivered these kinds of outcomes for government-sponsored assignments, I'd be blacklisted.

"The sector needs to sharpen its accountability and governance procedures as a matter of priority - starting from the very top. Otherwise, I see no chance whatsoever of the sector being taken seriously."

Acevo surveyed 638 members and 320 chairs for the report Raising Our Game, which is being published tomorrow.

The report revealed that the salary of a chief executive depends on the size of the charity. The median salary at organisations where the annual income is £150,000 is £31,500, compared with £95,000 for organisations with annual incomes of more than £25m.

It also showed the median salary for a male chief executive is £55,000, compared with £49,883 for females.

This constitutes a gap of 10 per cent, down from 20.1 per cent last year, when the median salary was £53,175 for men and £44,242 for women.

Bubb said it was good to see the pay gap had narrowed by 50 per cent since the 2001 survey.

But he added: "How can we claim we have good governance when 97 per cent of chairs are white and 70 per cent are male? We have to professionalise our act on board appraisal, appointments and development."

The research revealed that 30 per cent of respondents appraise the performance of their boards as a whole. This is up from 23 per cent last year, but compares badly with the 97 per cent of FTSE-100 companies that do so.

- See Editorial, page 13

FACT FILE

- 5.8 per cent of chief executives are gay or lesbian, earning £60,000 on average, compared with a sector average of £53,000

- 26 per cent of CEOs have succession plans in place

- CEOs of animal charities earn £68,500 on average, more than any other

- Disability charity CEOs earn £40,000, less than all others.

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