Comments:  Here are the most accurate figures for the above-listed executives I could find in reliable sources:

• Marsha J. Evans, President and CEO of the American Red Cross, was paid $468,599 in salary and benefits in fiscal 2003. (Source: BBB Wise Giving Alliance)
• Brian Gallagher, President and CEO of United Way, was paid $432,709 in salary and benefits in fiscal 2003. (Source: Charity Navigator)
• W. Todd Bassett, National Commander of the Salvation Army, was paid (along with his wife, who also works for the organization) $94,091 in salary and benefits in 2003 (including house and car). (Source: Fayetteville Observer)

Discrepancies

Some sources claim that W. Todd Bassett's 2003 compensation totalled $166,850, a figure apparently culled from a Forbes magazine feature published in 2004. However, that report, which lists each organization's "Top Person" and "Top Salary" separately, is footnoted as follows: "Compensation may not be that of listed top person."

According to a Salvation Army spokesperson quoted in the Fayetteville Observer, some of the organization's employees indeed make more than the National Commander, with the top wage-earner taking home "nearly $167,000 annually."

According to CBS Market Watch, W. Todd Bassett's total compensation for the previous year, 2002, was $82,000.

Is It Fair to Compare?

Caveats aside, Bassett's roughly $95,000 in pay is still significantly less than the $400K+ that both Evans and Gallagher take home annually. But it's fair to ask: Is one charity automatically more worthy than another just because its leader is paid a lower salary? Not necessarily, says Charity Navigator, a Web site that evaluates and compares the financial health of charitable organizations.

"While there are certainly some charities that overpay their leaders, Charity Navigator's data shows that those organizations are the minority," states the site's FAQ page. "Among the charities we've evaluated, the average CEO salary is $144,521. ...These leaders could inevitably make much more running similarly sized for-profit firms. Furthermore, when making your decision [about where to donate] it is important to consider that it takes a certain level of professionalism to effectively run a charity and charities must offer a competitive salary if they want to attract and retain that level of leadership."

Compensation vs. Total Expenses

Charity Navigator recommends looking at each organization's CEO compensation as a percentage of total annual expenses. For example, Marsha Evans' salary, generous as it seems, amounts to only .15% of American Red Cross' annual expenses. By contrast, Brian Gallagher's salary is .97% of United Way's total expenses, and W. Todd Bassett's compensation amounts to .29% of the Salvation Army's annual expense budget. All these figures are well below the annual average calculated for the thousands of organizations in Charity Navigator's database, 3.4%.

Sources and further reading:

America's Most (and Least) Efficient Charities
Forbes.com, 24 November 2004

Charity Navigator - Fundraising Organizations
Evaluates financial health of charitable organizations

Charities' Leaders Take Home Big Checks
Fayetteville Observer, 4 April 2004

Major Charity Heads Reap Rising Pay
CBS Market Watch, 5 December 2003

Charity CEO Compensation Study
Charity Navigator, 8 August 2005

Top 25 Charity CEO Compensation Packages
American Institute of Philanthropy

Last updated: 11/15/05