When the Chronicle of Higher Education released their annual rankings of salaries for private college presidents, a familiar name was near the top. Johns Hopkins' president William Brody remained one of the nation's highest paid college presidents with a total compensation package worth more than three quarters of a million dollars.
Only the presidents of Rockefeller, University of Pennsylvania, Vanderbilt and Rennselaer Polytechnic earned more than Brody's $772,276.
Brody's compensation has climbed nearly $100,000 from the 2001 to 2002 fiscal year, the latest one from which figures are available.
His salary has greatly outpaced inflation as well as the salaries of Hopkins faculty and non-health administration. He also receives compensation for serving on the boards of private corporations, a sum that is not shown in his current salary figure.
Even as salaries for college presidents like Brody climb around the country, quickly approaching the $1 million mark, most schools are quick to defend the hefty sums awarded to university presidents.
"College presidents are eminently qualified people," said Shelly Storbeck, managing director of the higher-education division for AT Kearney, an executive recruitment firm.
"Presidents have to deal with a number of issues, things like investment, increasing revenues, physical plant and fundraising."
A combination of other factors has led to increased pay in recent years. The sheer complexity of running a multi-faceted institution such as Hopkins keeps the pool of willing, qualified candidates quite low.
And even though salaries for college executives is high, it does not begin to compare with the huge pay, benefits and severance packages executives in corporate America receive.
"[College presidents] could walk into the private sector and command different salaries," said Storbeck. "Look at the number of execs who sit on corporate boards, who deal with investments, increasing revenues, physical plant operations [and] fundraising."
Jean Dowdall, vice president of Educational Management Network/Witt/Kieffer, an executive search firm serving nonprofit organizations, says the comparison is not so direct.
"It's not so much that if college presidents don't like academy, they could walk over to General Motors. Rather the issue is, shouldn't there be substantial compensation for executives of higher education?"
Richard Ingram, president of the Association of Governing Board of Universities and Colleges agrees.
"We're not trying to catch up with corporate America. These salaries aren't anything equivalent to what's going on in private industry," he said. "Some of those salaries are obscene. This is about being fair, equitable and being able to attract talent when the job opens up."
The idea that college presidents would make good captains of industry is probably exaggerated said Ingram, but with such high competition for limited talent, prices must increase. "Like it or not, we're competing with one another for real talent and real talent is expensive," he said.
Often people misunderstand the role college presidents says Dowdall. "The job as president, the fact is you see that everyday, in the quality of faculty that are hired and the co-curricular life and the buildings that are there. If the students feel they are getting a good education, the president deserves some credit for that."
"Bill Brody is running a city," said Storbeck. "He has tenants, police force, a physical plant. To be a university president today you have to know so much about how the world functions at an elevated level. You need vastly talented people."
Competition amongst other universities also plays a large role in executive pay says Dowdall. "Rice and UPENN are both looking for presidents and you can bet Bill Brody's going to be a prospect for those campuses.
You can be sure that money is part of those packages they'll offer. If Johns Hopkins allows his salary to weaken, he becomes a target for other institutions and that's the hazard."
President of the Hopkins Board of Trustess and CEO of Legg Mason, Raymond "Chip" Mason, said that a number of issues, many unique to Hopkins, factor into Brody's salary.
"What we typically do is look at what other presidents are making, while holding the long standing view of the complexity of Johns Hopkins," said Mason.
"It becomes more complex than running a university because obviously the med school and research either directly or indirectly come under the scope of the president."
"Mike's [Bloomberg, former president of the Hopkins board of trustees] contention has always been that the president of Hopkins should the top paid president in the country, if we wanted a very strong president for the job. At the minute, what we've tried to do is stay up there, where he's [Brody] competitively priced with schools of the caliber of Hopkins."
Brody's role as a successful fundraiser also factors into the boards decision, said Mason. "If we want to redo the campus, the med school or both, he as the president is the one who has to go out and find that money."
Mason estimates at least 30% of Brody's time is spent fundrasing. Hopkins is currently on pace to meet a $2 billion fundraising goal by 2007, thanks in large part to Brody's effectiveness as a fundraiser.
"We don't want him so driven to raise money that that's all he's doing," said Mason. "But we do take into consideration his effectiveness as a fundraiser." As Maryland is suffering budget deficits and is cutting aid to private universities, Mason said, "we have to raise that money somewhere else."
Mason feels the rest of the board as satisfied with Brody's performance as president as he is.
"He's done a good job in diversifying his time and effort, keeping an eye on time with students and faculty, alumni, fundraising, the business side of operating the university. When [the board] went to grade him, there wasn't any specific area we had that he was underperforming in."
Mason feels Brody's salary is very deserving and that the president is satisfied. "I think he feels we've been very fair. He's never pushed for more pay. We've always pushed for him to be paid more."
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