UPenn president gets $23 million

[Parasaurolophus]

Figured this story might be of interest:

It's likely the highest annual total ever paid to a college president, but the vast majority of it — more than $20 million — was accrued over Gutmann's nearly two-decade-long tenure as the Ivy League university's leader and paid out as agreed when it vested, just months before she departed.

[...]

The total amount includes what's known as deferred compensation, and if Gutmann, who was president for 18 years and left last year to become the U.S. ambassador to Germany, had not met the goals set or left early, she could have lost it. Many colleges offer deferred compensation packages as a way to retain high-quality leaders: They set aside money each year in a fund with an agreed-upon date on when that money can be withdrawn.

[...]

Gutmann's total figure for 2021, reported on the 990 tax form, includes her annual compensation of a base salary of $1.56 million and a bonus of $1 million and the $20.2 million deferred compensation and supplemental retirement funds, which also includes investment gains the money made over 17 years.

I would have thought that an annual salary of $1.5 million plus bonuses and perks would be sufficient.

[dismalist]

Figured this story might be of interest:

It's likely the highest annual total ever paid to a college president, but the vast majority of it — more than $20 million — was accrued over Gutmann's nearly two-decade-long tenure as the Ivy League university's leader and paid out as agreed when it vested, just months before she departed.

[...]

The total amount includes what's known as deferred compensation, and if Gutmann, who was president for 18 years and left last year to become the U.S. ambassador to Germany, had not met the goals set or left early, she could have lost it. Many colleges offer deferred compensation packages as a way to retain high-quality leaders: They set aside money each year in a fund with an agreed-upon date on when that money can be withdrawn.

[...]

Gutmann's total figure for 2021, reported on the 990 tax form, includes her annual compensation of a base salary of $1.56 million and a bonus of $1 million and the $20.2 million deferred compensation and supplemental retirement funds, which also includes investment gains the money made over 17 years.

I would have thought that an annual salary of $1.5 million plus bonuses and perks would be sufficient.

"She raised more than $10 billion for the university". Looks to me she worked cheap. :-)

[kaysixteen]

Ok, she was in charge when $10b was raised for the school, but exactly how much of those donations are directly attributable to her, and how much of these would likely have been given if anyone else, say Mickey Mouse, were uni prez?

IOW, it is very difficult to sell such salaries to the tuition-paying students and their families.

[dismalist]

Ok, she was in charge when $10b was raised for the school, but exactly how much of those donations are directly attributable to her, and how much of these would likely have been given if anyone else, say Mickey Mouse, were uni prez?

IOW, it is very difficult to sell such salaries to the tuition-paying students and their families.

I knew that was coming!

That's for Penn's board to decide. They know more than you or me. Had they thought not enough was incoming, they could have kicked her out any time. They had near 20 years to do so.

The parents are looking at the $10 billion incoming, not the measly $20 million outgoing.

Penn got a great deal.

[kaysixteen]

No,  it isn't.  Penn is a non-profit university that has a great deal from the taxpayers, more or less not having to pay any taxes.  We get a say.

[Parasaurolophus]

Ok, she was in charge when $10b was raised for the school, but exactly how much of those donations are directly attributable to her, and how much of these would likely have been given if anyone else, say Mickey Mouse, were uni prez?

IOW, it is very difficult to sell such salaries to the tuition-paying students and their families.

I knew that was coming!

That's for Penn's board to decide. They know more than you or me. Had they thought not enough was incoming, they could have kicked her out any time. They had near 20 years to do so.

The parents are looking at the $10 billion incoming, not the measly $20 million outgoing.

Penn got a great deal.

It actually cost them at least $53 million. To my mind, it seems likely they could have hired five people dedicated to fundraising--maybe even a mix of name brand academics, former sports stars, and other relative celebrities--at a rate of $300k and done just as well. And kept the $23mil to boot.

[dismalist]

Ok, she was in charge when $10b was raised for the school, but exactly how much of those donations are directly attributable to her, and how much of these would likely have been given if anyone else, say Mickey Mouse, were uni prez?

IOW, it is very difficult to sell such salaries to the tuition-paying students and their families.

I knew that was coming!

That's for Penn's board to decide. They know more than you or me. Had they thought not enough was incoming, they could have kicked her out any time. They had near 20 years to do so.

The parents are looking at the $10 billion incoming, not the measly $20 million outgoing.

Penn got a great deal.

It actually cost them at least $53 million. To my mind, it seems likely they could have hired five people dedicated to fundraising--maybe even a mix of name brand academics, former sports stars, and other relative celebrities--at a rate of $300k and done just as well. And kept the $23mil to boot.

Five people, ten people, whatever. Had the Board thought five people at $300K could have pulled in more money that Gutmann alone, they would have done so.

It may be hard to imagine, but there are stars and superstars who are that productive. And, though the details are not spelt out in the article, it is alluded to that this was very much a measurable performance contract.

Penn is not a candidate for the Colleges in Dire Financial Straits thread.

[Parasaurolophus]

Five people, ten people, whatever. Had the Board thought five people at $300K could have pulled in more money that Gutmann alone, they would have done so.

I doubt it, since that's very much not the done thing. They just did the done thing and got lucky. That doesn't change the fact that it's an incredible sum of money to pay a single person. That it worked out okay doesn't entail it was necessary.

[downer]

It's not as much as some of the coaches.

It does help disabuse us of some notion that academics are about something etherial, for anyone who held on to that idea.

Maybe there's some irony that this is Amy Gutmann we are talking about, a prominent defender of social democracy. I wonder if she experiences any cognitive dissonance between her pay and her beliefs in equality. I doubt it though. 

[dismalist]

Five people, ten people, whatever. Had the Board thought five people at $300K could have pulled in more money that Gutmann alone, they would have done so.

I doubt it, since that's very much not the done thing. They just did the done thing and got lucky. That doesn't change the fact that it's an incredible sum of money to pay a single person. That it worked out okay doesn't entail it was necessary.

There's a lot more than luck involved. Lots of the pay was deferred pay over a 17 year period, payable upon meeting performance goals, plenty of time to get rid of her and save the deferred pay. A clever contract. A bit like stock options in a for-profit company.

Stars and superstars earn well. If they didn't, they'd take it easy and both the manager and the employer [here, along with the students] would be worse off.

[simpleSimon]

Payouts of deferred compensation will always grab eyeballs and complaints from people who have little to no idea how large universities operate, but Penn got a very good deal--one any other institution would be happy to copy or clone.  Those of us in the peanut gallery can debate how much credit Gutmann deserves for the donations and growth in the endowment, but she doesn't answer to us.  She answers to a Board, and they are obviously very pleased with her and her long tenure.

Someone suggested that because Penn has a not-for-profit tax status "we get a say."  No we do not.  If you believe that you get a say what other aspects of Penn campus life do you want to have a say in?  What courses are taught?  Which faculty are hired?  What books are in the library?  When a new degree program is created?  Perhaps when a new building is built?  Or do you only want a say when you see a titillating headline in a newspaper?

[Wahoo Redux]

I have no problem with Gutmann's good luck or presumably hard work.  I am happy to see an executive payout to a highly successful woman instead of a good ol'boy too.

But these things are also hard to hear when one has been laid off and additional admincritters are hired because of university finances. 

I suspect that part of the snarling and yipping is just human nature in hard times even if, like me, you have never set foot on the UPenn campus. Here is yet another executive taking a rock star payout while some of us see our careers go up in smoke after years of hard, dedicated work. 

[kaysixteen]

Yes, we really do get a say.  Not the only say, but clearly a say.   If Penn (and places like it) do not like this, they may well find themselves having to pay enormous amounts of money annually in taxes, which they will *certainly* like even less.

[dismalist]

Yes, we really do get a say.  Not the only say, but clearly a say.   If Penn (and places like it) do not like this, they may well find themselves having to pay enormous amounts of money annually in taxes, which they will *certainly* like even less.

You know, I'm not even against that. But it would have to be for everybody, not a policy against a particular institution.

I'd be happy to abolish non-profit status for everybody!

[quasihumanist]

Yes, we really do get a say.  Not the only say, but clearly a say.   If Penn (and places like it) do not like this, they may well find themselves having to pay enormous amounts of money annually in taxes, which they will *certainly* like even less.

You know, I'm not even against that. But it would have to be for everybody, not a policy against a particular institution.

I'd be happy to abolish non-profit status for everybody!

Actually, as a society, we subsidize all activities of large businesses by giving them corporate status, allowing their owners and managers to evade liability for their actions (and giving them various other rights of natural persons).

I'd like to abolish corporate status for everybody.