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Compensation

Questions for Boards

Recommended Resources

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Why this is important.

Boards are increasingly recognizing the value of a dedicated compensation committee because hiring and retaining a president are among the core fiduciary responsibilities of governing boards. Committee members must ensure that the compensation and benefits an institution pays its leaders are reasonable, compliant with the law, befitting of the institution’s philosophy and budget, and effective at securing the best talent possible.

Source: The Compensation Committee by Thomas K. Hyatt, AGB 2013

Questions for boards.

Click below to reveal key questions for your board to consider:

Fundamentals

Consequential Questions:

  1. Is our committee aware of the impact of issues brought before other board committees that deal with compensation-related issues?
  2. Are our committee meeting agendas concise and do they clearly state desired meeting outcomes?
  3. What is our institution’s average tenure for presidents?
  4. How competitive is our compensation package for presidents compared with our peer institutions?

Sources:The Compensation Committee by Thomas K. Hyatt, AGB 2013

Discussions

Consequential Questions:

  1. Does our committee translate our charges into annual goals and work plans that align with the board’s governance responsibilities and our institution’s strategic plan?
  2. Does our committee ensure that the institution is determining and paying compensation in a manner that is compliant with applicable law?
  3. How effectively does our committee facilitate presidential evaluation? When was the last time we updated our annual assessments or comprehensive assessments?

Sources:The Compensation Committee by Thomas K. Hyatt, AGB 2013

Relationships

Consequential Questions:

  1. Is our committee work aligned with our institution’s strategic vision, goals, and priorities?
  2. How transparent is our committee with the full board? Do we effectively provide reports and recommendations for action by the full board?
  3. Do our committee members possess business acumen or experience in the human resources arena? If not, are there board members outside the committee we should consider inviting to join?

Sources:The Compensation Committee by Thomas K. Hyatt, AGB 2013

All resources.

Bundle
Effective Committees (Public) Bundle
Get all of the bestselling Effective Committee Series in one set! The Academic Affairs Committee The Audit Committee The Facilities Committee The Governance Committee (Public Institutions) The Compensation Committee The Development Committee The Executive Committee The Finance Committee The Investment Committee The Student Affairs Committee There is a bulk discount on …
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Webinar On Demand
Getting Off to a Good Start with a New President
November 8, 2021 - Watch this Webinar On Demand for practical insights into higher education presidential transitions from an expert of unparalleled experience counseling boards and leaders.
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Blog Post
Q&A: An Inside Look at an OCIO Search Process from the Investment Committee Chair's Perspective
January 05, 2021 - SEI interviewed Michael Ellis, the investment committee chair for Moravian College, to find out more about the college's outsourced chief investment officer (OCIO) search process. We talked about what led the committee to make the decision to begin a search …
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FAQs
Presidential Contracts
Well-crafted presidential compensation and benefit contracts provide a clear and solid basis for healthy working relationships and effective performance. A presidential contract should be a comprehensive agreement that establishes all requirements and expectations between an institution, its governing board, and its …
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Blog Post
Build Compensation Packages to Protect Your Institution and Attract Top-Notch Leaders
October 12, 2020 - When institutions conduct searches for presidents or other senior leaders, building the right compensation package should be a primary concern. Compensation must be fair, defensible, and competitive to attract excellent candidates and stand up to scrutiny. Boards and hiring officers …
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Trusteeship Article
Focus on the Presidency: Six Things to Offer Your New College President
When a colleague asked what advice I would offer following my first year as president of Susquehanna University, it struck me as a vainglorious topic: “Let me tell you how good I am at being new.” Then I realized that …
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Book
Presidential Compensation: A Comprehensive Guide for Higher Education Governing Boards and Chief Executives
Foremost among the responsibilities of a college or university governing board is the recruitment, evaluation, and support of the institution’s president. This includes, fundamentally, providing for reasonable compensation of the president—a task that is now more challenging than ever, because …
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Trusteeship Article
Legal Standpoint: Negotiating the President's Contract
In the last issue of this magazine, the “Legal Standpoint” column addressed campus counsel’s role in reviewing institutional contracts. This column is devoted to the complexities surrounding one particular contract: the employment agreement between the institution and its chief executive …
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Trusteeship Article
Setting Presidential Compensation
Do you know the total amount and elements of the compensation package provided to your college’s or university’s president? Do you know the rationale for the decision to provide the particular compensation and benefits chosen? Was the final compensation package …
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Trusteeship Article
Datafile: A Picture of Variable Pay
In order to recruit and retain effective leaders who are able to advance rigorous strategic goals and other institutional priorities, boards are considering various forms of compensation. A recent AGB Quick Governance Survey (QGS) sought to understand the national trends …
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