UNIVERSITY PARK, Pa. – The Board of Trustees’ Committee on Compensation today (Sept. 18) approved salary increases of 3 percent to 5 percent for four senior executives, based on the recommendation of University President Eric Barron.
The committee, formed in November 2013, is charged with approving the compensation packages of a small group of executives, including the provost, senior vice presidents, athletic director and head football coach, among others. Under its operating guidelines, the committee’s responsibilities vary depending on an executive’s place within a five-tier structure that also is spelled out in the guidelines.
Those whose compensation was reviewed and approved include:
-- Stephen Dunham, vice president and general counsel, received a 3 percent increase bringing his annual salary to $545,904;
-- Nicholas Jones, executive vice president and provost, received a 4 percent increase, bringing his annual salary to $494,004;
-- Rod Kirsch, senior vice president for Development and Alumni Relations, received a 5 percent raise as well as a market salary adjustment of $20,000 bringing his annual salary to $467,304; and
-- David Gray, senior vice president for Finance & Business/Treasurer, received a 3 percent increase and $40,000 market adjustment, bringing his annual salary to $452,004.
The Committee on Compensation may grant market adjustments to salaries in an effort to pay a fair market value for a particular position. The adjustment is made after a thorough analysis of data — such as market conditions, an employee’s duties, experience, supervisory responsibilities and areas of oversight.
In addition, the decision is informed by benchmarking with comparative compensation data from a mix of top private and public American research universities. Penn State relied on external advisers to help develop its Executive Compensation Strategy document that allows University officials to map what other institutions are offering for similar positions, to establish equity, and to also allow Penn State to remain competitive in recruiting and retaining executive talent.
Each of these individuals receiving compensation adjustments has responsibilities that spread across Penn State’s 24 campuses, involving its 17,000 faculty and staff, and nearly 100,000 students. They have served during a time of considerable growth and progress. Among the University’s achievements over the last year are:
-- This month, U.S. News & World Report ranked Penn State No. 14 among national public universities in the 2014 Best Colleges rankings. (http://news.psu.edu/story/325650/2014/09/09/academics/penn-state-among-top-national-public-schools-2015-us-news-best)
-- For the Future: The Campaign for Penn State Students concluded, raising $2.188 billion in private support, exceeding a $2 billion goal. (http://news.psu.edu/story/311758/2014/04/12/academics/future-exceeds-goal-raises-2158-billion-private-support)
-- In May, the total number of undergraduate applications was more than 81,000, roughly 14 percent higher than the previous year. (http://news.psu.edu/story/315263/2014/05/09/administration/board-trustees-meets-president-erickson-delivers-final)
-- The University ranked No. 2 nationally among the Best Colleges for Veterans, schools that participate in federal initiatives helping veterans and active service members apply, pay for and complete their degrees.
-- Membership in the Penn State Alumni Association grew to 174,379, a net gain of nearly 1,700 or 1 percent as of June 30. (http://news.psu.edu/story/320401/2014/07/11/administration/alumni-association-membership-exceeds-174000)
-- More than $2 million in research activity takes place daily at Penn State. The University’s research program has an annual expenditure of more than $800 million including more than $500 million in federal funds and $100 million from private industry brought to Pennsylvania annually.
-- Penn State is the state’s largest nongovernmental employer and has employees and expenditures in every one of its 67 counties. At last survey, the University generates a total economic impact across Pennsylvania that surpasses $8.5 billion annually.
-- Penn State recently won the 2014 Outstanding Higher Education Award from the National Recycling Coalition, recognizing the University for “an exceptional program in recycling or in connecting higher education and the industry in the areas of degrees, tech transfer, career services, etc."
Penn State appointed Dunham vice president and general counsel in July 2012 after he held the same position at Johns Hopkins University. He is responsible for overseeing all legal affairs of the University.
Jones assumed responsibilities as executive vice president and provost in July 2013 after serving as Johns Hopkins’ Benjamin T. Rome Dean of the Whiting School of Engineering. He is the chief academic officer, responsible for the academic administration of Penn State’s resident instruction, research and continuing education, and for the general welfare of the faculty and students.
Kirsch came to Penn State in 1996 as the first vice president for Development and Alumni Relations and has been the senior vice president for Development and Alumni Relations since 2006. During his tenure, the University has secured nearly $4 billion in private gift commitments.
Gray arrived at Penn State in February 2012, after serving as the University of Massachusetts’ senior vice president for administration, finance and technology, and university treasurer. He is responsible for the management of Finance & Business, a unit that includes the offices of Auxiliary and Business Services, Human Resources, Physical Plant, and University Police and Public Safety. He also leads financial, endowment, and business and administrative activities at all Penn State campuses.
“Penn State’s continued progress is the product of the work of large numbers of talented and committed people, and the leadership that oversee these areas of the University provide the necessary positive and professional environment required to keep Penn State moving forward,” said Carl T. Shaffer, chairman of the Committee on Compensation. “Based on the recommendation of the president, it is appropriate that their work be recognized. The ability to recruit, retain and reward top leadership is essential, and the committee’s role in executive pay governance is a critical element.”
As per the Compensation Committee Operating Guidelines, a vote from the full Board of Trustees is not needed to approve salary increases for members of senior leadership classified under Tier II. Only action related to the compensation of the University President (Tier I) requires a vote of the full board. However at Friday’s meeting, the committee will inform the full board of today’s decision.
These salary adjustments will be effective Oct. 1, 2014.