Disclose charity pay

Posted on January 11, 2009 in Governance Debates, Social Security Debates

TheStar.com – Opinion/editorial – Disclose charity pay
January 11, 2009

In these tough times, Canadian charities are working harder than ever to raise money for their good works.

But for charities, as for any business, it costs money to raise money.

To help maintain public confidence in charity work, the Canada Revenue Agency regulates fundraising by requiring the disclosure of what percentage of donations is spent on administration costs. Under proposed CRA guidelines released last year, charities should keep fundraising costs below 35 cents on the dollar. The goal is to reassure donors that most of their money is going to help deserving causes, rather than paying expenses and salaries.

Yet Ottawa is still lagging behind the U.S. in its regulation of the vital fundraising sector.

As the Star’s Kevin Donovan reminded us in his recent story about a change of the guard at one of Toronto’s biggest charities, most fundraisers won’t say how much money they are paying their own top people. He reported that the departing president of SickKids Foundation, Michael O’Mahoney, earned a remarkable $624,103 in salary and benefits last year, more than the president of the Hospital for Sick Children for which he was raising money.

The Star discovered O’Mahoney’s salary only because of disclosure documents filed with the Internal Revenue Service in the U.S., where SickKids Foundation arm does business, not the CRA.

Canada had long lagged behind the U.S. in disclosure of corporate salaries but, belatedly, shone a light on something shareholders have every right to know. Fundraising has become a big business, and the donors who have a stake in Canada’s 83,000 charities deserve no less transparency than shareholders in big corporations.

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