• April 18, 2014

CEO Compensation at Publicly Traded Higher-Education Companies

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For-profit colleges have been the fastest-growing sector of higher education for years. Their business model, which relies heavily on the availability of Pell Grants and government-subsidized student loans, has allowed many of them to flourish as publicly traded companies or as sought-after holdings in the portfolios of private-equity investors. Some of that financial success is reflected in the compensation paid to top executives of the colleges' parent companies, which they report annually to shareholders.

Comments

1. 22237822 - June 23, 2010 at 04:33 pm

Incredibly misleading. What are the salaries? How do they compare to traditional education? Since over 90% of the compensation is other, why do you not define that? Are the Non Traditional buisiness models and Presidents salaries reliant on public monies? I guess fairness is not part of the Chronicle's mission.

2. flannigan - June 23, 2010 at 04:48 pm

If you click on the top of the graph on Salary in the - Interactive Chart bar - you will see the actual salary amount that they make. You can also look in Special Reports of the Chronicle to find out the compensation of executives in higher education.

3. lisaberlinger - June 23, 2010 at 04:54 pm

If you check the instructions, you can check the circle for Salary.
It ranges from $373,000 (rounded) to $832,000. The salaries of nonprofit and public universities appear in the Chronicle every year
and are readily available at this site.
Are the "Non Traditional Business Model" and Presidents' salaries
reliant on public money? The institutions are because they get receive federal student loans, at a minimum. Nonprofit & public schools have on occasion tried to use your implied argument, that because high salaries for certain officials come from a separate fund with no govt money, the univ. doesn't have to be accountable
for the high salary.

4. molly1 - June 23, 2010 at 05:44 pm

The salaries by themselves seem comparable to nonprofits and publics. The "other," which probably consists of stock options and/or retirement plan contributions is way beyond anything in the nonprofit sector.

5. goldieb - June 23, 2010 at 06:35 pm

For readers' convenience, in a box at the top right of this page, we've now listed a few our recent pieces and tables on executive compensation in non-profit higher education. There is plenty more available in our searchable archive.


6. goodeyes - June 23, 2010 at 11:24 pm

If the Chronicle could also show what the course professors are being paid at these schools, this would tell a lot about quality too in my view.

7. feudi - June 24, 2010 at 08:14 am

Molly1 is right on target. The salaries by themselves are not over the top. The stock options, etc. are astounding! And, by the way, as much as 85% of all revenue at for profits can and, in most cases, does come from federally funded higher ed sources such as Title IV (Pell grants, Direct Loans). The argument that most of the tuition at for profits comes from non-government money is a bald faced lie!

BTW, that means that most of the $78 million fine that was levied on the University of Phoenix, i.e., Apollo, Inc, was, in the end paid by you and me. How does that make you feel?

8. rogmar - June 24, 2010 at 08:22 am

Quality is measured in outcomes, not inputs. Employers have been hiring, retaining and promoting private sector IHE graduates for a long time. That would not be happening without quality graduates. Also, check this compensation against the big-time sports coaches . . . and take in consideration the repeated NCAA violations . . . and the academic records of many of the top athletes.

9. mdefusco - June 24, 2010 at 08:48 am

It is true that some of theses executives are paid handsomely. But these salaries are not paid by tax payers. Student loans are guarenteed by the government, but student loans rightly go to students who as informed consumers have a choice. This is unlike coaches. Nack Brown at Texas and Rick Neuheusal at UCLA are funded by taxpayers. Andrew Clark and Chas Edelstein might have done better, but to paraphrase Babe Ruth when asked why his salary was better than the President of the United States, "They had a better year".

10. krispiekritter - June 25, 2010 at 10:45 am

Just an observation here.... We seem to be comparing the CEO of private, for profit Schools with the Presidents of not for profits. In each case, these are corporations (remember that!) with multiple schools and "business units" involved. Each of these individuals far exceed the managerial reach of any not for profit institution President. If you want a more reasonable comparison of salary and compensation, you may want to break down these massive corporations into their individual schools and compare the President's compensation to that of the not for profit sector.
I do work for one of the for profit schools listed and am following what Congress and the Government are doing very closely.
I am still confused as to how "taxpayer money" is abused when the results are more people with higher education, more college graduates than ever before because of the for profit sector.
Is it that the not for profit sector is trying to get their piece of the pie? Or have the for profits neglected to "pay off" the legislators?

11. prof_truthteller - June 26, 2010 at 05:01 pm

24/7 Wall St. lists Apollo Group among top fifty least trustworthy companies in America: http://bit.ly/bh7qM1

12. prof_truthteller - July 04, 2010 at 01:15 pm

@krispiekritter, (comment 10): A student attending a community college to get a two year certificate will first be advised as to available tuition waivers, scholarships, and grants BEFORE being advised on any loans. Tuition in any state CC will range 50-200 per unit. A student at a for profit, however, will be steered straight to the loans, with tuition and fees from a thousand per credit and up and up and up. After two years, the student is in debt for 15-30K. That money went to the for profit, straight thru the student from the federal student loan program (ie, taxpayer money) and into the CEO and stockholders portfolios. It is a gravy train like you wouldn't believe. Meanwhile, the student is stuck with the debt which can only be discharged by DEATH. Compare that with the CEO pay scales (and faculty pay if you can find out what that is) and I DARE you, and anyone else, to try to explain how that is not corrupt and unethical.

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