Firmer grip on U's compensation plans is warranted.
Close governing board oversight of executive compensation, including paid transitional leaves, ought to be the norm for any large public institution. At the University of Minnesota henceforward, it will be.
That's the promise of a well-crafted set of new policies adopted June 8 by the Board of Regents. The policies, developed by a working group led by regents Richard Beeson, Dean Johnson and John Frobenius, seek to standardize senior administration compensation practices. Deviations from the pattern will still be possible, but only with the written approval of the chair and vice chair of the board.
To its credit, the board declined to impose its judgment on all executive compensation changes. That would be micromanagement. But the changes will assure that more information regularly reaches the board, including how Minnesota's university pay practices stack up with its institutional peers.
It's regrettable that it took revelations of embarrassingly generous leave-taking benefits for a number of senior administrators in recent years to bring about these changes. Then again, it's telling that it took a Great Recession for Americans to see how often corporate governing boards were similarly inattentive. Left unchecked, executive compensation easily balloons.
When regents went looking for best practices in higher ed governing board oversight in this realm, they found very little, Beeson said. That suggests that in many colleges and universities, tradition and ad hoc thinking drive compensation for top administrators.
That may have been acceptable in the 20th century, but it won't cut it in the 21st. Tight money and public skepticism have combined to require more transparency and accountability from all higher education institutions, particularly those funded with tax dollars.
We won't be surprised if other American universities come calling soon on Minnesota's Board of Regents for advice about getting a firmer grip on pay practices.
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