Tuesday, February 8, 2011

Charities offer big pay to draw talent

Feb 8, 2011

Salaries can go up to $300k a year at some non-profit organisations

By Judith Tan

NON-PROFIT organisations are offering their top managers salaries that match those outside the charity sector to attract the best talent.
A check by The Straits Times of the websites and annual reports of such organisations shows medical charities - such as the National Kidney Foundation (NKF) and Ren Ci Hospital & Medicare Centre - and religious organisations to be the best paymasters.
Pay packages can go up to $300,000 a year at some of these bodies, comparable with the $310,600 a managing director outside the charity sector makes.
An audited statement for the NKF's financial year that ended last June, for example, indicates that 10 people in key management roles there were being paid between $100,001 and $300,000 each.
Its four most highly paid employees each took home $220,001 to $300,000 a year; six others were paid $100,001 to $150,000 each in the same period. (ST later issued a correction. Only 1 staff earned between $221k & $300k.) Its spokesman disclosed that the salary of its highest earner is between $250,001 and $300,000. The Straits Times understands that this is the salary of Dr Mooppil Nandakumar who, as head of medical services, is responsible for the charity's 2,774 kidney patients and beneficiaries.
The spokesman added: 'We need to benchmark our salaries to public hospitals. If we don't, we won't be able to attract doctors to work for us.'
The Charity Council fine-tuned the process of salary disclosure last month to make it a requirement for non-profit agencies to declare the earnings of their three most highly paid employees.
Previously, only the salaries of those drawing more than $100,000 a year had to be declared.
The council's guidelines to tighten governance in the charities - which extend beyond salary disclosure to programme management and fund-raising, and the composition of their boards - have been in place since 2007.
They were introduced in an overhaul of the charity sector following the 2005 NKF scandal in which the lack of checks and balances saw its former chief T.T. Durai being paid more than $600,000 a year - a sum which outraged the public.
The salaries of top earners from Ren Ci Hospital & Medicare Centre also show that the organisation is willing to pay good money to land the best managerial talent.
Its latest annual report - in the wake of its own scandal in 2007 over chief executive Ming Yi's court case on dodgy financial accounting - indicates that its highest-paid employee earned a gross salary of between $100,001 and $150,000 last year.
This is a drop from 2009, when its top earner was paid between $250,001 and $300,000.
Ren Ci declined to say who this person was.
Among religious organisations which pay well is mega church City Harvest.
Its online financial statements for the financial year that ended in October 2009 indicate that close to a quarter of its $40 million in expenses went to staff salaries and allowances. A rough calculation shows the average annual remuneration of each of its workers to be almost $62,000.
In 2005, New Creation, another mega church, disclosed that it paid one employee between $500,001 and $550,000 a year. It did not say whether this employee was its leader, Senior Pastor Joseph Prince.
But he and Pastor Kong Hee of City Harvest have since taken themselves off the payroll.
The salaries of the head honchos at charities providing social services, however, are only about half those of their counterparts in organisations which pay well.
For instance, former lawyer Tim Oei took a pay cut of up to 30 per cent to head the Asian Women's Welfare Association (Awwa) - which runs a special school and a community home for the destitute elderly, among other services.
At Awwa, two staff members are paid between $100,001 and $150,000 each, and one, more than $150,000.
Charity Council chairman Fang Ai Lian said charities should 'professionalise themselves' and pay for talent.
'It will cost money, but I think the outcome will outweigh the cost.
The sector needs good management, especially in the larger outfits,' she said.
Agreeing, associate professor Mak Yuen Teen - who headed the committee which fine-tuned the Charity Council's code of governance - said a gross disparity between the charities and the corporate and professional world would make it tough for the charity sector to attract and keep the best talent.

[Update: ST Editorial]

Feb 20, 2011

Charities and salaries

Did it come as a surprise that three days after The Straits Times published a report two weeks before about how charity bodies offer big pay to draw talent, a letter would appear in the Forum page arguing against it? Of course not. Salaries are such an emotive and polarising issue in Singapore that it would have been surprising had there not been such a letter. The correspondent, Mr Victor Looi, trotted out the expected argument: 'People should want to join non-profit organisations mainly because they want to make a difference. Competitive commensurate pay should be secondary.'

Thankfully, the letter drew responses from two individuals who know better. The first was from Associate Professor Mak Yuen Teen of the National University of Singapore Business School who, as he stated, sits on charity boards and is the chairman of one. The second, published last Monday, was from Dr Keith Goh, who has been the board chairman of Make-A-Wish Singapore since 2007. Both repudiated Mr Looi's argument. In his letter, Dr Goh spelt out the duties of a charity chief executive, which include carrying out the mission well and meeting the needs of its beneficiaries and managing both paid staff and volunteers.

We agree with both the correspondents and Charity Council chairman Fang Ai Lian, who said that charities should 'professionalise themselves' and pay for talent. Of course, charity leaders should not expect to pull in the kind of money that disgraced National Kidney Foundation chief executive T.T. Durai used to receive - $600,000 a year. The present range of salaries from just over $100,000 to $300,000 for charity leaders looks just about right.

Both the public and private sectors in Singapore are well oiled. The people sector, comprising non-profit organisations, should not lag behind.

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