<p>"For the second straight year, the chief executives of 36 private U.S. colleges or universities earned more than $1 million in 2010, according to an annual study by the Chronicle of Higher Education. ... advocates such as Michael Dannenberg, of Washington's Education Trust, question whether there is too much focus on revenue and too little on outcome. 'There are colleges with highly paid presidents and abysmal graduation rates,' he said. 'There should be a connection between presidential pay and student performance.' "</p>
<p>The real scandalous salary is the third one, for the former president of Birmingham Southern college. He ended up resigning in 2010 as a result of a huge financial accounting scandal, in which the university had to eliminate some majors and several faculty and staff positions because of the need to cut about 10 million dollars, or 20% of its budget.</p>
<p>The school itself is not that large–about 1300 students–and before the 2008 recession and scandal had an endowment of about 110 million. Today, the value of its endowment is about 1/2 that, about 52 million.</p>
That would be very difficult to quantify. People would need to determine what’s meant by ‘student performance’ in the first place. </p>
<p>These are private colleges - they s/b able to pay their executives whatever they want and the consumers, i.e. students/parents paying to attend the college, can decide for themselves whether they think the cost is worth it, whether the college is being run appropriately according to however the individual feels that should be determined, whether they think the financials make sense, etc.</p>
<p>I think there are too many envious people worried about remuneration of others. OTOH, are any of these college heads actually worth in excess of $1M? I can see arguments pro and con. It’s not much different than corporations in the sense that sometimes the heads are indeed quantifiably worth every penny and sometimes not. It’s probably easier to quantify in a corporation that has objective financial data to readily analyze but maybe in that respect colleges are similar since they also have a financial bottom line. The difficulty is when one wants to quantify ‘student performance’ at the college level. How does one determine that?</p>
<p>The first job of a university president is to raise money, from the alumni and from Washington D.C. So in that regard, a large salary is worth it to the university.</p>
<p>The president of my child’s university is on the list. It’s difficult to compare, but based on what I know I think he’s been worth it. He’s raised a staggering amount of money and raised Northeastern’s profile. </p>
<p>Frankly, to me, it looks like some other college presidents may be underpaid.</p>
<p>Vanderbilt University is the second largest private employer in the state of Tennessee. With a world class medical facility and university, Nick Zeppos (ranked #5) probably earns every penny if you value his skill set as compared to a private company CEO.</p>
<p>Football coaches are only as good as their last season. Ask Auburn’s Gene. Corporate CEO live on a quarterly basis. In the world of academia, years of sinecures are the norm. And the poor performers simply find another position. From K-12 to tertiary education, the salaries of the upper administrators are rarely short of obscene.</p>
<p>And it is almost YOUR money that is being lavished on the insiders.</p>
<p>Well @prefect, presidents usually spend millions or billions on elections alone. That said, they’re pretty much already millionaires/billionaires. They’re more in it for the power Just my side note haha</p>
<p>If they were paid them based on graduation rates, standards would plummet. It corrupts the system and gives a false standard against which to measure. It’s part of what’s wrong with the public K-12 system.</p>
<p>I agree with prefect ^ the salaries of coaches at some of these large public universities are obscene compared to the true value they add (that should be the real story)–I understand that winning football programs generate huge amounts of revenue for the schools, and that alumni pride is important,etc. but when you boil it down, football/basketball is entertainment…NOT education. And college coaches while having large staffs and many responsibilities certainly do not have the level of responsibility that a Nick Zeppos at Vanderbilt has with oversight of several large graduate schools and a medical facility as 2VU0609 ^pointed out and not to forget, a D1 athletic program. I must confess that I have never even heard of some of those colleges with highly compensated presidents (Pacific Lutheran??) but those at USC, Vanderbilt, Northwestern, JHU, the Ivies are very deserving of their pay in my opinion.</p>
<p>A good college coach can bring in millions of dollars in revenue for a school based on team performance. </p>
<p>A University President is the head fundraiser for a school and can add clout to the University if they are a big name in academic circles. Many CEO’s are in the million dollar range or above a University President is in affect a CEO. I can see where the pay would be in that range for better known private colleges.</p>
<p>This statement betrays a misunderstanding of the role of college presidents. They are not educators. They are first and foremost fundraisers (as Collegealum points out) and publicists for their institutions. Administrative decisions about academic and instructional policy are made and implemented by provosts and deans, not presidents. At best, the president has veto power over such decisions.</p>
<p>It seems a reasonable rate of pay because the institutions they run are comparable to a medium sized employer. </p>
<p>A President could have a positive impact on a school. On the other hand I bet it is a pretty hard job to screw up. As long as you glad hand enough Alums and stroke the ego of important faculty you can probably doze off in your office the rest of the day.</p>
<p>A $1 million of compensation is fair for a person running a large university, which may also include a medical center. For example, the President of Penn State runs not only the main campus, but also 20 branch campuses, extensive online course offerings, a huge medical center, an airport, and a technology park. </p>
<p>But $1 million is too much for someone who is only running a small or medium sized college.</p>
<p>A good college president is probably worth the million. They have to control billions of dollars and deal with intractable politics on campus. We can make a few comparisons</p>
<p>“CEO make 400 times more than workers”
“The share of corporate income devoted to compensation of the top-five executives in public firms grew from 4.8% in 1993-1995 to 10.3% in 2001-2003”</p>
<p>10% of the budget of a big school like UCLA is in the hundreds of millions of dollars.</p>
<p>Clearly, given that university professors are often able to lead companies and vice versa, colleges need to offer a competitive salary beyond the increased prestige of being a uni president.</p>
<p>Many universities have more “world-class” departments than Vanderbilt. Other than the medical and education schools, Vandy is not ranked that highly. So if you really just go by current rankings, the president may have been overpaid. He’s being paid so well mostly because the school expected him to take the school to the next level and to improve (hopefully) significantly from where it was.</p>
<p>Many private companies’ CEOs don’t earn more than $1M by the way.</p>
<p>Sam Lee,
I’m well aware that the compensation we are talking about is in excess of typical CEO cash compensation. Private company CEOs prefer to have a substantial part of their compensation tied to their stock options so that they can gain the benefit of tax preferences currently available for capital gains and stock dividends. Those options increase their compensation greatly beyond their salaries. That option isn’t available to university presidents.</p>
<p>^Well, then, you are talking about publicly traded “private” companies. In that sense, I am not sure if I’d agree with you. These companies have quarterly earnings to report to the public; they fight for survival and can and often become history. It seems much harder to screw up a college.
If the stocks go up, I guess, which isn’t necessarily a given these days.</p>
Just my side note haha</p>