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Presidential Compensation in Higher Education

Hard Copy




The issues surrounding presidential compensation in higher education have become ever more challenging since 2000, when AGB first published this popular guide on the topic. In addition to the changes wrought by the Sarbanes-Oxley Act, several highly publicized governance failures in the nonprofit sector—often related to executive compensation—have intensified the spotlight on how boards conduct their fiduciary responsibilities, including the area of executive compensation.

National attention to the compensation packages of higher education leaders is unlikely to subside. Trustees must be vigilant in carrying out their responsibilities in hiring presidents and chancellors, establishing appropriate levels of compensation, and assessing the performance of these leaders. Both boards and presidents need to know:

  • What constitutes a competitive and fair compensation package?
  • Are some benefits more appropriate (and attractive) than others?
  • How should trustees participate in the compensation review process?
  • What’s the best way to link presidential compensation to performance assessment especially in light of the new IRS regulations?