Vice-chancellors who focus on short-term goals paid more – study

Universities that pay their vice-chancellors higher salaries tend to be more focused on achieving short-term performance goals, according to a study.

An analysis of UK-based higher education institutions over a six-year period found senior leaders who earned the most were, on the whole, more motivated to target improvements in areas such as finances and rankings, where evidence can be quickly gathered to justify their wages.

At the same time, pursuing longer-term goals, such as widening access, addressing gender pay gaps and improving contributions to society, was more closely associated with leaders at the lower end of the pay spectrum.

Authors Collins Ntim, professor of accounting at the University of Southampton, and Mohamed Elmagrhi, senior lecturer in accounting at Swansea University, argued that their findings showed the need for strong governance in universities, with independent committees, unions and student bodies countering the power of the executive and insisting on a broader range of targets.

Professor Ntim said that while the pay of senior leaders was a “highly controversial and very topical issue”, there was rarely any “careful evaluation of the role the vice-chancellor does and how they are measured”.

The study – soon to be published in Work, Employment and Society – considered the annual reports of 117 institutions between 2009 and 2014.

Basic vice-chancellor pay during the period was found to range from £108,000 to £577,000, with an average of £225,000. When accounting for bonuses and other incentives, this rose to between £122,000 and £623,000, with an average of £262,000.

Institutions that prioritised targets such as improving student continuation rates and building better relationships with key stakeholders – seen as longer-term goals – tended to pay their leaders lower wages, whereas those that had stronger performance in areas such as improvement in teaching and research rankings had better remunerated leaders.

Professor Ntim said vice-chancellors often held a lot of power at the top of institutions – including setting priorities – and the new study showed the importance of strong checks and balances.

“We are not saying the short-term objectives – be they financial or reputational – are not important. What we are saying is it has to be balanced,” he said.

“Given that fulfilling long-term goals has a negative implication on pay, if there is no long-term monitoring, the vice-chancellor is naturally going to favour short-term goals that can be easily realised to justify their wages.”

tom.williams@timeshighereducation.com