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Compensation Trends in Higher Education

The 2011/12 Compensation Trends report from Yaffe & Co. offers vital insights into salary trends, benefits, and deferred compensation for presidents, provosts, and CFOs in higher education. This report highlights key data from the Executive Compensation Survey 2010/11, revealing year-over-year changes in median base salaries and the prevalence of frozen salaries among higher education leaders. It outlines the median increases across roles and discusses variable pay opportunities. Understanding these trends is crucial for stakeholders in educational institutions.

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Compensation Trends in Higher Education

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  1. Compensation Trends in Higher Education

  2. Rian Yaffe Senior Consultant Chairman & CEO Saundra Tracy Senior Consultant Immediate Past President, Alma College

  3. Topics • Salary Trends • Benefits & Perquisites • Deferred Compensation • Outlook for 2011/12

  4. 2010/11 Survey participants Executive Compensation Survey 2010/11 n= 193 27% of the Presidents who responded were women

  5. Compensation TrendsMedian Base SalariesYear over Year TrendsVariable Pay Awards

  6. Base Salary Data:President • Median Base Salary 2009/10: $250,000 • Median Base Salary 2010/11: $251,500 • Median Increased: 0.6% • Median Increase for Same Incumbents: 2.3% • 37% of presidents reported frozen salaries • Of those who received an increase, median increase was 4.2%

  7. Presidential Salary Changes(same incumbents 2009/10 to 2010/11)

  8. Base Salary Data: Provost • Median Base Salary 2009/10: $150,000 • Median Base Salary 2010/11: $151,500 • Median Increased: 1.0% • Median Increase for Same Incumbents: 2.5% • 23% of provosts reported frozen salaries • Of those who received an increase, median increase was 3.1%

  9. Base Salary Data: CFO • Median Base Salary 2009/10: $138,795 • Median Base Salary 2010/11: $151,208 • Median Increased: 8.2% • Median Increase for Same Incumbents: 3.6% • 17.3% of CFOs reported frozen salaries • Of those who received an increase, median increase was 4.7% Yaffe & Co. Survey: Exec Comp, 2010/11

  10. Median base Salaries2007 to 2010 Since 2007, median salaries for Presidents have increased 12.3% Since 2007, median salaries for Provosts have increased 11.4% Since 2007, median salaries for CFOs have increased 11.7%

  11. Median base SalariesChief Officers

  12. Presidents Eligible for Variable Pay

  13. Variable Pay Awardspresidents 2010/11 Survey Eligible: 32% Median of Max Opportunity: 20% Received: 64% Median Received: $25,000

  14. Provosts Eligible for Variable Pay

  15. Variable Pay AwardsProvosts 2010/11 Survey Eligible: 19% Median of Max Opportunity: 25% Received: 58% Median Received: $10,000

  16. CFOsEligible for Variable Pay

  17. Variable Pay AwardsCFO 2010/11 Survey Eligible: 19% Median of Max Opportunity: 12.5% Received: 72% Median Received: $8,000

  18. Median CompensationBase Salary + Variable Pay Since 2007, median cash comp for Presidents have increased 13.1% Since 2007, median cash comp for Provosts have increased 11.0% Since 2007, median cash comp for CFOs have increased 13.3%

  19. Deferred Compensation

  20. Age DistributionPresidents Median Age: 61

  21. Presidents aged 65 and over

  22. Percent provided Tax Sheltered Annuity Plan 403(b)

  23. Percent SERP provided 2006 – 2010

  24. SERP Contribution as Average Percent of SalaryPresident

  25. Perquisites

  26. HousingPresidents • Housing Provided: 56% • Allowance Provided: 22% • Median Monthly Allowance: $2,500

  27. AutomobilePresidents • Automobile Provided: 72% • Allowance Provided: 19% • Median Monthly Allowance: $643

  28. Have a Process

  29. New Form 990 Revamped by IRS because they wanted more information from non-profits Number of non-profits has exploded since the form was last updated in 1979 Concerned many non-profits are not living up to benefits of tax-exempt status Helps IRS understand how an organization is structured and governed IRS believes that forcing non-profits to disclose will get them in line:“A tax compliant organization is a well-governed organization” Steven Miller, IRS Commissioner

  30. Rebuttable Presumption of Reasonableness • Independent Board Committee • Appropriate Comparability Data • Process Documentation

  31. Compensation Approval process • President Compensation & Benefits: approved by Executive Committee or Board • VP Compensation & Benefits: approved by Compensation Committee

  32. Penalties for Knowing Approval of Excessive Compensation • Intermediate Sanctions (either in addition to or instead of revocation of tax-exempt status) • Repayment of excess plus 25% excise tax for Executive • 10% up to $20,000 jointly or severally for Board/ Committee Members

  33. Outlook for 2011/12

  34. Questions ? Saundra Tracy 410-494-4109stracy@yaffeco.com Rian M. Yaffe410-494-4111ryaffe@yaffeco.com

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