Although the first publication of official figures on the pay enjoyed by the leaders of England’s universities contained no real surprises – after all, Times Higher Education has published its own figures on vice-chancellor pay for many years – it does help to add to a growing body of official data on the issue.
But England’s figures, published by the Office for Students, the sector’s regulator, are a rare example of an official publication on university leaders’ pay. Some Canadian provinces publish figures on university presidents’ pay as part of a wider “sunshine list” of top public sector earnings. But otherwise, it has largely been left to media organisations to piece together the statistics from universities’ financial accounts and, even then, many countries publish no or little information about leadership remuneration in such statements.
So how possible is it now to make an international comparison of leaders’ pay and can any comparison bring performance into the calculation?
Although the picture is far from complete, it is now possible to compare data from the UK, the US, Canada and Australia, which represents a large chunk of universities at the top of the THE World University Rankings. This allows the start of a simple “bang for buck” metric on leadership pay to be constructed.
To illustrate this, THE looked at the top 50 universities in the ranking where data were available for the total pay package of the vice-chancellor or president. Discounting institutions where the latest figure could be skewed by there being more than one leader in post still leaves data for three-fifths of the top 50. Converting the total remuneration to pounds sterling and then looking at this relative to a university’s overall score in the ranking shows the score achieved by each institution per £1,000 spent on its leader.
The results, while far from comprehensive, do give some initial insights into the kind of factors that drive leadership pay in different countries.
Topping the list is the University of Toronto, which achieves a score of 0.28 per £1,000, thanks to the relatively low pay of its president Meric Gertler. According to Ontario’s latest “sunshine list” of public sector pay, Toronto’s leader earned the equivalent of just under £300,000 in 2017 (a figure that would be even lower if the pound had not weakened in recent years). It is a pay figure that is below that of about half of all England’s universities, including many that are well outside the top 200 in the world rankings.
Another Canadian university, the University of British Columbia (37th in the ranking), comes in 8th for bang for buck (0.21 per £1,000) while the US universities in the top 10 all have a common theme – they are public institutions, with three from the University of California system. The UK also fares relatively well in the list, with UCL in fourth place and the University of Oxford in sixth.
At the other end of the scale, those with lowest “bang for buck” are all US private universities, demonstrating the huge difference in remuneration between leaders of public and private institutions in the country.
Timothy Devinney, university leadership chair and professor of international business at the University of Leeds, who has studied executive pay across the world, said that it was important to consider the different types of recruitment markets that existed in the US. But another key point was the roles that US presidents were expected to fulfil in terms of bringing in external income, he added.
“[In the US] pay is driven by a mixture of different things and the most obvious of these is funding,” he said, adding that “if you don’t [as a president] generate the cash flow from external sources” then the university will struggle to achieve its goals.
It is something that governing bodies in the US have a keen eye on because they often include people who have donated money personally to the university as alumni or local philanthropists, Professor Devinney said, unlike in the UK or Australia where he argued that such a driver for accountability was lacking.
Professor Devinney also argued that Australia – where according to the latest figures, average pay is approaching A$1 million (£537,000) – had a less competitive market for vice-chancellors. Although an Australian institution – the Australian National University – is in the top half of the “bang for buck” table this is due to its vice-chancellor, Brian Schmidt, famously accepting what is a relatively low salary for the sector.
A deeper look at the figures for England, by including other OfS pay data for universities in the top 200 of the rankings, also suggests that there does not seem to be a strong link between rankings performance and their pay. For example, the top-ranked university in the world, Oxford, has a lower score per £1,000 spent on its vice-chancellor, Louise Richardson, than a university ranked at 57 (the University of Manchester, led by Dame Nancy Rothwell).
It is also notable that Oxford and Manchester (third and first on score per £1,000 in the England-only table) both have a female vice-chancellor while the leaders of the bottom four on the measure are all male.
Sue Shepherd, honorary senior research fellow at the University of Kent, who has studied the recruitment of female pro vice-chancellors in UK universities, said that the data were too limited to draw any firm conclusions that gender was playing a role.
But the figures did “raise the bigger question of the extent to which any v-c’s pay (regardless of gender) is actually performance-related", she added.
Dr Shepherd pointed to a paper last year on vice-chancellor remuneration in the UK that suggested that pay was much more likely to be down to “benchmarking behaviour" rather than performance. “In my experience, institutions are obsessed with what their peer group is doing and I suspect that the benchmarking of v-c salaries is commonplace,” she said.
Dr Shepherd added that two factors that could be influencing gender differences in vice-chancellor pay could be how long a leader was in post, given that most long-serving leaders were male, and the increasing trend towards the recruitment of “serial v-cs” who move institutions more frequently, driving up the market rate on executive pay.
For this second factor, “arguably men have been the primary beneficiaries to date: most serial v-cs are men as they still have the most top-level experience” she said, but it would be “interesting to see if this changes over time given the emergence of the first female serial v-cs” such as Louise Richardson, Janet Beer (head of the University of Liverpool) and Alice Gast (Imperial College London).
THE DataPoints is designed with the forward-looking and growth-minded institution in view
Print headline: Which leaders give bang for buck?
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