Charity executive pay: current rates and contributing factors
As in previous years it can be difficult to provide a meaningful or truly representative list of market rate salaries for executive roles, given the multitude of factors commonly at play.
These will often include (but won’t be limited to) location, supply and demand, and the issue that you are seeking to address with the appointment. Since people tend to grow within their role, trying to replace their current skills on a like-for-like basis will often require an uplift in salary, too.
In relation to the appointments made by our executive search team, we have witnessed a slight increase in salaries offered, with average salaries offered to directors and CEOs shifting slightly upwards from last year to sit within a banding of between £50,000 and £120,000.
CEO salaries remain dependent on a number of competing factors including the current scale of the organisation, its ambition, complexity, location and geographic footprint, regulatory requirements, as well as challenges specific to the organisation and the role. While a table of averages would therefore have little meaning, we’re always happy to provide tailored salary advice on a case-by-case basis, taking all the relevant factors into account.
Increasingly, any specific or immediate challenges facing an organisation are being better quantified, and often addressed, by hiring an interim while the permanent search progresses.
We’re also seeing a more collaborative approach between the board and the executive, as part of the wider conversation on governance that has taken place in recent years, with chairs and trustees often prepared to play a more supportive role in tackling challenges such as a temporary lack of CEO.
Funders have become more involved too, in certain circumstances having been prepared to fund not only the search, but the incoming CEO’s salary.
Changing priorities and skills in demand
Meanwhile salaries in general appear to have become a slightly less contentious issue (especially those paid to CEOs), partly as a consequence of improvements in governance, and partly as a result of the intense public scrutiny which the sector has been under in recent years.
Charities generally are becoming more realistic about what can be achieved in the current political and economic environment, and though we still appoint to organisations aiming for dramatic growth or change, there appears to be a greater focus on sustainable growth, and a more outward-facing approach to external partnerships.
As such, more externally-focused candidates are in high demand, individuals who can increase the influence of their organisations, reach new audiences and drive their fundraising ambitions. Typically skilled negotiators and adept at managing relationships, many will have an extensive record of meeting beneficiaries’ evolving needs via innovative programme and service design.
Although performing a non-executive role, trustees in the sector are rarely remunerated for their commitment, and recently there has been a wider-ranging public conversation regarding the respective merits of non-executive expenses and/or salaries.
The imperative to increase diversity on boards is often raised here, since those who can afford to volunteer the necessary time without financial compensation are generally drawn from a fairly limited demographic. However, in our experience the clamour for change seems to have become a little quieter, with a strong argument for the status quo coming from those who wish to preserve the volunteering ethos of the sector.
We have also seen growing interest in trusteeship from commercial firms (as a means of developing emerging talent and senior leaders), more focus on achieving greater diversity across all measures, and more sustained efforts to ensure the voice of beneficiaries is heard in board discussions.
Contact the Harris Hill Executive Search team
Download the full 24-page 2019 Salary Report
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