Gender Pay Differences in Senior Management of Charities

Abstract: In this paper, we investigate the market for CEO and top managers in the non-profit and charities sector. Using data from charitynavigator.org, we document two new stylized facts not documented before in the literature. First, we find that female CEOs are more likely to receive compensation than their male counterparts. Second, conditional on receiving compensation, female CEOs receive 6% to 8% lower total compensation than male CEOs do. These findings are robust to the inclusion of charity classification fixed effects (between estimator) and charity and title fixed effects (within estimator). Further in-depth exploration of the results shows that interestingly enough, the gender pay gap is only present in the largest charities (top quintiles in the expense and revenue distribution). Our investigation of potential mechanisms suggests perceived differentiation of male and female CEOs as well as CEO impact on charity performance as potential channels explaining the observed gender gap in CEO pay.