The Business of Charities

[grounded]

The disclosure of high salaries for some charity's chief executives in Ireland and the UK (Angela Kerins Rehab 240k euro, Jasmine Whitbread Save the children £234k) has led to a renewed interests into the financial activities of all charities. Is this level of remuneration justified?
           Save the Children robustly defended their CEO salary;
In a statement, Save the Children said: "To run an organisation that reaches 10 million children in more than 50 countries, with thousands of staff, in some of the toughest places in the world takes real leadership, experience, knowledge and skill.

"Without this talent we would not, in the past five years, have almost doubled our income from £161 million to £284 million, enabling us to reach more of the neediest children on earth than at any point in our 90-year history

Rehab stated that "The rate of pay for the Rehab Group chief executive is significantly below the market median"( what market ?).

I came across this comment on another site and couldn't help but agree with his/her sentiment.

"In justifying their generous salaries, most chief executives point to their successful performance record—the more they squeeze out of the donating public, the more they feel entitled to reward themselves; in this respect, the work ethic is essentially the same as for any commercial venture.
                                 However, where a charity should differ from a purely business enterprise is in the nature of its 'merchandise'—it should be working solely for the benefit of the cause, not to make a profit for profit's sake.
                                 A charity should endeavour to pass on to the cause as much of its receipts as is possible. This means that all salaried staff should be prepared to exercise restraint when remunerating themselves".

I appreciate we are only talking about some of the largest charities but in these tough financial times the negative publicity is likely to tarnish all charities and make people think twice before donating. In my opinion some of the aforementioned CEO's have take the phrase ' charity begins at home ' literally