Executive compensation in charitable organizations: a comparison of media coverage and actual practice in Canada

According to the Canada Revenue Agency, there are over 80,000 registered charities competing for donations from organizations and private citizens to raise funds for their charitable mandate and to cover their operating expenses. A threat in the form of negative perceptions noted by the media poses a risk to these charitable operations as one media perception highlights issues with exorbitant executive compensation in the charitable sector (Blumberg, 2018). Given charitable organizations are dependent on organizations and citizens for donations, media attention related to high compensation levels within a charitable organization, may threaten their ability to raise funds needed to achieve their mandate. My thesis consisted of three distinct phases. In Phase 1, publicly available media articles were thematically analyzed to determine the core concepts that are discussed by the media that have the potential to shape public perception to compensation within charitable organizations. Phase 2 consisted of analyzing the compensation data of nearly 20,000 Canadian charities to determine the actual practices of executive compensation in Canadian charitable organizations. Finally, Phase 3 quantitatively analyzed the compensation data of the organizations discussed in the media articles of Phase 1, to identify if the media is accurately representing the Canadian averages. The findings of these three phases revealed that the media is not accurately portraying the executive compensation practices of many of the not-for-profits organizations in Canada. My thesis significantly adds to the areas of research surrounding executive compensation within the charitable sector, as it is one of the first studies to assess the accuracy of the media coverage on executive compensation within the charitable sector and how this may shape the public’s perception on executive compensation. My thesis also provides a novel framework for charitable organizations to better benchmark their executive compensation levels to organizations of similar size based on Canadian averages