California State University needs to establish stricter policies for compensating its current and former employees and to provide better oversight of those decisions, according to a state review.

The findings of the Bureau of State Audits, which were released today, concluded that the 23-campus system had not broken any laws or violated university policies in the ways it has compensated executives and other employees.

But the report, which was requested by the state’s Joint Legislative Audit Committee, made six recommendations for how Cal State should seek to improve its practices.

The auditors said the university system should create a centralized information structure to catalog compensation; consider total compensation at comparable institutions, and not just cash compensation, when deciding on salary increases for employees; improve the scrutiny of pay provided to executives as they leave their jobs; develop stronger regulations to govern paid leaves of absence; strengthen policies governing relocation expenses; and impose new disclosure and approval requirements on outside employment for faculty members and other employees.

Faculty members and legislators have criticized Cal State for providing what they see as excessive compensation to administrators. At a time of tuition increases, they have found fault, for example, with six-figure paychecks to departing executives, whom they say did little or no work in their job transitions.

Cal State officials said today that they felt vindicated by the auditors’ having found no violations of policy or law. They also called the report’s findings and recommendations fair and balanced.

“We agree with all of the auditors’ recommendations in concept and will be working with the board on the most feasible way to implement them,” said Charles B. Reed, the chancellor. —Sara Hebel