Gender Pay Gap Breakthrough for NFP Women CEOs

Exclusive remuneration data from Pro Bono Australia’s annual Salary Survey reveals that women leading Not for Profit organisations earn 87 cents for every dollar men earn – above the rate of the general female workforce.

In 2016 Pro Bono Australia partnered with business advisers and accountants HLB Mann Judd to deliver its fourth annual Salary Survey, which includes Australia’s most comprehensive chief executive officer remuneration data in the sector.

This year’s report specifically explored gender differences in pay and the impact of educational qualifications on CEO remuneration.

The recent international Glassdoor Economic Research report highlighted a gender pay gap in Australia of 17.3 per cent, with women earning 83 cents for every dollar men earned. However, when controlling for factors such as personal characteristics, job title and industry, the gap reduces to 3.9 per cent.

However, Pro Bono Australia Salary Survey researcher and founder of Beveridge Consulting, Andrew Beveridge, said that while the overall gender pay gap for NFP CEOs therefore appears not dissimilar to the gap found in the Glassdoor report, controlling for organisation size reveals a more intricate story.

“For NFP organisations with operating budgets of $500,000 to $2 million and $2 million to $10 million, the median total salary package for men is indeed higher than for women,” Beveridge said.

“However, for organisations both smaller and larger than these ranges, female CEOs earn more than their male counterparts based on median salaries. This data suggests that the gender pay gap varies by organisational size to be at times in favour of men, while other times in favour of women.

“While around two out of three CEOs of NFP organisations with operating budgets up to $2 million are women, this reduces to 50 per cent and 44 per cent in organisations with an operating budget greater than $2 million within the sample.

“While just 40 per cent of the CEOs in Pro Bono Australia’s Salary Survey are male, they make up 56 per cent of the CEO positions in organisations with an operating budget of $10 million to $50 million.

“It therefore appears more difficult for women to have the opportunity to take up CEO roles with larger NFP organisations, despite being represented more commonly across all NFPs.”

Beveridge said a key challenge in the NFP sector lies in addressing this gender opportunity gap.

“What are the factors that seem to prevent women taking on CEO roles in our largest NFP organisations? Is it a lack of women applying for these roles, or some other bias in the system that leads men to hold the majority of these roles?,” he said.

The Not for Profit Salary Survey provided salary data which covered 18 roles that are common to most NFP organisations.

The CEO data gathered by Pro Bono Australia included the highest level of qualification individuals have received. The research found that higher level qualifications do not appear to consistently lead to higher salaries for CEOs in NFP organisations.

“Even when controlling for organisation size using operating budgets, postgraduate qualifications don’t always command higher salaries,” Beveridge said.

“For example, in organisations with an operating budget of between $2 million and $10 million, the median salary package for those with postgraduate degrees is actually slightly less than those with lower-level qualifications.

“However, it does appear that larger NFP organisations are typically led by CEOs who have postgraduate qualifications. In organisations with a turnover of $10 million or less, only 34 per cent to 37 per cent of CEOs have postgraduate qualifications. For larger organisations this jumps to 63 per cent and 64 per cent.

“It seems therefore that while postgraduate qualifications don’t necessarily lead to higher salary levels, they may be a more desirable characteristic when recruiting CEOs for larger NFP organisations.”

Pro Bono Australia’s head of business Matt Betts said the 2016 Salary Survey provided an unrivalled remuneration benchmarking tool for the Not for Profit sector.

“The social sector is characterised by its diversity. Consequently, we have drilled down into sectors within the sector, revealing distinct variations as well as presenting the research sorted by location, job title, organisational size and turnover,” Betts said.

“Our particular thanks to Andrew Beveridge of Beveridge Consulting for his deep and intelligent analysis of the figures backed by his extensive experience in remuneration. Our thanks too to HLB Mann Judd for their timely and robust support of the research.”

Pro Bono Australia’s Salary Survey can be purchased as a complete report or in sections relating to specific job titles. Find out more here.