The University Chancellors Council (UCC) released a voluntary code last month providing a set of principles and processes for fair and appropriate university leadership remuneration.

Australian universities are encouraged to disclose transparent remuneration details of their vice-chancellors and senior staff. This is inclusive of base salary, short term incentives and long term incentives. The Code also encourages reporting incentive plan details, including financial and non-financial measures.

The suggested reporting of remuneration governance includes disclosing the role of the council, delegations to sub-committees and mechanisms used for benchmarking and performance review to be in annual reports.

To ensure competitive remuneration, UCC will commission annual market reviews and set remuneration expectations based on the data. The Code defines appropriate remuneration as fair reward that accounts for the “responsibility, accountability, scale and complexity” of the position and that aligns with the interests of the university, funders and general society expectations.

This commitment by the UCC is to establish:

• Broad expectations of competitive remuneration;
• Annual benchmarking to compare the spread of remuneration across the sector and to the median salary of a university’s vice-chancellor and its senior staff; and
• Reporting of remuneration and governance in annual reports.

We expect that the disclosures will draw media and stakeholder comparisons to international peers. Based on Guerdon Associates’ work with universities, vice-chancellor and executive pay is relatively high on an international basis, which we expect some stakeholders and news media may cast as a negative. However, our analyses have also indicated that based on various performance measures and size characteristics, Australian vice-chancellor pay is on the whole positioned appropriately. Indeed, in many cases, we are getting good value for the money.

For the full remuneration code, see HERE.

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