Competitive salaries

Tuesday, April 7th, 2009

April 3, 2008 Ed Cartoon

The release of information regarding the annual salaries of Ontario university presidents shows interesting discrepencies in the pay of various institution heads.

For instance, University of Toronto President David Naylor, who earns $429,681.60 including other benefits, makes far less than the presidents of Waterloo, Guelph and York universities, all undeniably smaller institutions. The highest pay goes to McMaster University president Peter George at $504,792.05 after benefits, while Western President and Vice-Chancellor Paul Davenport earns annually $376,703.16 including other taxable benefits.

The report also reveals many university presidents in Ontario make far more than the prime minister of Canada, who earns $312,922 including other benefits to work in an arguably less important public position.

Of course, these salaries pale in comparison to the millions earned by top-tier private sector CEOs.

While it is interesting to note these differences in salary, the question the information raises for many is whether the amount of pay university presidents receive is justified. Some might argue it’s far too little, while others, particularly the taxpayers and students who fund these presidents’ pay, might argue it’s too much.

Detractors should consider the fact university presidents are the face of an important public institution and are therefore entitled to the rate of pay they receive.

While one can argue public sector positions like those the university represents should not pay exorbitant salaries for the mere fact they’re publicly funded, and that the money could be better used elsewhere, universities in many ways must operate as a business would in the private sector. They must be innovative and compete for talent, and therefore necessitate the wages that attract the best thinkers.

University presidents therefore largely come from a business background, and because public institutions can’t offer the same degree of pay as the private sector for the obvious reason they’re driven by public service rather than profit, it’s humbling to think university presidents choose the route of public service at all. After all, the private sector can offer them so much more for their skills.

Qualifications aside, to compete in the arena of business one must comport him or herself with a certain dignity. While driving a fancy car and living in a large manor with a private staff are the perks many look at initially, they present an image of prestige, a fact that has far-reaching benefits for the public the institution serves.

Could Western really generate the same air of prestige if it paid its main representative only a five-figure or even low six-figure salary?

The heads of universities are paid competititive wages because they have the skillset and expertise to guide the institution appropriately. When we stop to think about the important role universities play on both a social and economic level, we realize the leaders of these institutions are paid fairly for the job they do.

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