Privacy Advisor

Privacy and the Paycheck

November 1, 2005

A Q & A between the IAPP's Executive Director J. Trevor Hughes and Dr. Larry Ponemon, founder and president of the Ponemon Institute, on the Exclusive Findings of the Privacy Professional's Role, Function And Salary Survey:

Trevor: Every year it seems that the average salary of privacy pros is going up and that seems to be the finding again this year. You know, privacy pros seem to be solidly in six figures. What can you tell us about that?

Larry: It seems like every year the salary continues to increase and it's tracking at or above the national average. We actually compare results of our research against national census statistics and U.S. Labor Bureau statistics, and you know the good news is that if you're in the privacy industry you are probably earning a good salary. I am sure some people feel like they can earn a whole lot more doing other things, but quite frankly, it's a pretty nice place to be right now. We see that between 2004 and 2005 salaries increased an average of 2.5 percent, but that's a little bit of an interesting issue, if you kind of study our report, you will find that if you were an individual at the middle or senior levels of management, your salary rate actually increased substantially. In fact, the sum total net increase between 2004 and 2005 is closer to 10 percent.Trevor: The average across all privacy professionals, as I see in the survey, is about $109,000. Did that reflect sort of a growing professionalization in privacy or does it reflect the fact that many privacy pros are coming to the job from legal backgrounds, or where do you think that is coming from?

Larry: That is a great question Trevor. It's interesting that when we look back in time in ancient history before the IAPP we talked about the privacy profession and people would scratch their head and say, "What is that? Well, now it's just the opposite. I think we are starting to see more and more people very proud of the fact that they are in this profession. It basically suggests that our management and executives in companies find a lot of value in what we do, so using your term "professionalization," I think with professionalization, we are starting to see higher salaries, and hopefully that is a trend that will continue into the future.

Trevor: One of the things I did note in the survey is that it sure does seem to be important where you report to as a privacy professional. If you report through Compliance or HR, the average salary was $90,000, give or take a little bit. If you report to the CEO or CFO it was $137,000.

Larry: Obviously, if you are reporting to the CEO, you are probably positioned pretty high in the organization, and that probably explains why people who are directly reporting to the CEO or even the Board of Directors, are earning a very high salary relative to others. But it does make a difference, for example, if the Chief Privacy Officer is reporting through Corporate Security or HR. A secondary issue that may explain the salary differences is the educational background. There are people, for example, say at the security area, that have a bachelor's degree only and they are in privacy, and I am sure they are quite capable, especially if they have a CIPP credential. But there are folks, for example, in Corporate Law who are probably attorneys. Therefore, based on the graduate degree, the law degree, they are  probably earning a higher salary as well, so that might explain some of the salary difference.

Trevor: One other thing I noted is that it seems to make a difference if you are in a particular industry, so our hardworking colleagues in the healthcare industry do not seem to be making as much as perhaps others, and I am presuming it is the same sort of reasons that are pushing those sorts of results.

Larry: I know we have lots of members who are hard-working, dedicated individuals in government or retail, or healthcare, and in our study these folks are at the bottom of the list in terms of average salaries. Folks in the technology and software industry, or the pharmaceutical industry, or working in professional service firms, like Deloitte for example, are earning a much higher salary. Some people in some industries just earn less. I am not sure if it is fair, or if it is based on equity or if it is just economic reality, but we do see that, and that tracks across all three years in which we have been doing the study.

Trevor: Now one of the things I was really happy about with this survey was that it looked not only at the cold, hard numbers, but it also looked at a current versus ideal allocation of effort. In other words, where do privacy professionals spend their time, and where do they think they should be spending their time? And is there a mismatch between those two things? And in fact, the survey showed a bunch of mismatches.

Larry: One of the questions that we included on the survey this year was: How do you spend your time as a percentage to the total amount of hours that you allocate to privacy against your ideal? How would you like to spend your time to be more effective? The reality is that we found a lot of people spend their time responding to incidents — incident management, problems, issues in the workplace, that explains as much as 50 to 60 percent in some cases of an individual's time. Now that's important. I don't want to downplay the value that that brings to a company. But the same people were saying, ‘Look, I'd like to be less involved in day-to-day incident management and more involved in privacy strategy development, proactive risk assessment, the implementation of policies and guidelines and even training and communications.'

Trevor: I'm wondering if that reflects a frustration in the privacy profession that senior management just doesn't get it sometimes, or that with all of the voices that senior management needs to hear, there is just not enough time to get all of the privacy messages across.

Larry: You know, I think that is a common frustration for Chief Privacy Officers. Even beyond this report in talking to my colleagues and friends who are the privacy leaders of large organizations and small organizations, it appears that we don't have enough face time with the senior executive team, the CEO in many cases. Now clearly, we are in the boardroom when there is a disaster, when we have to notify people of a gigantic security breach, we are front-and-center then. But just on an ongoing basis having a conversation or a dialogue on these issues, it is probably important for a lot of us to have face time with senior executives, because this IS very important.

Trevor: Larry, let's leave the report just for a second and see if we can offer some guidance to privacy pros. What kind of things do you think privacy pros can or should be doing? I'll throw out a couple that I think are pretty clear indicators. Branching out beyond a single compliance channel it seems to me is a good indicator of higher salaries that if you are outside of just an HR or just a Compliance or just a Legal Department and you are touching Marketing, touching Consumer Affairs or Customer Relations, that might be an indicator of better income potential. Similarly it would seem that better education and things like certification could also be part of that equation, what do you think?

Larry: I think that if you are a new member of the privacy community I would strongly suggest, get certified, get your CIPP, because it is through professionalization that you will reap a higher salary. In terms of what you can do currently, right now, as a privacy professional, I think education is  important. But I also think it's important to figure out your role — that it is not just a compliance role. Anywhere that information about people or about households is handled, it's managed, it's retained, it's saved, it's moved, there is a privacy issue — and get in front of those issues. Try to be proactive in helping to manage that. One issue which is kind of tough, and it depends on the organization and its culture, but I think in order for a Chief Privacy Officer to be effective, that person needs to be no more than three steps away, three levels away from the CEO. Otherwise, the message may get muddied.

The IAPP Salary Survey, which was performed and co-sponsored by the Ponemon Institute, is available to IAPP members. To request a copy, send an email to information@privacyassociation.org.