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The PTM Executive Compensation & Evaluation Model
The new IRS 990 Form requires college and university boards of trustees to establish a clear and documented process for making decisions about executive compensation. Moreover, a world marked by increased scrutiny, financial constraints, and public insistence on greater effectiveness, accountability and transparency demands that boards develop procedures for evaluating and enhancing presidential performance. The PTM Executive Compensation & Evaluation Model, grounded in diffusion and adoption of planned change theory and in systems theory, is designed to enhance governance by maximizing institutional effectiveness, efficiency and transparency. The model has four integrated components:
1. Assessment: PTM will assist the Board of Trustees in compliance with the new IRS 990 Form by identifying a peer group for comparison and then collect and compile executive compensation data. PTM will also create a web-based 360 degree evaluation instrument to measure presidential effectiveness and to identify areas for improvement.
2. Strategy: The PTM Executive Compensation & Evaluation Model has three strategic goals:
• Compare the budget, endowment, enrollment, fundraising, and reputation to peer institutions in order to understand the competition and establish an appropriate peer group to compare executive compensation.
• Enhance Board governance by annual review of executive compensation as part of submitting the IRS 990 Form.
• Develop a cost-effective way to evaluate presidential performance that also provides direction for the Board and the President for setting priorities and goals to enhance presidential performance and institutional effectiveness.
3. Management: PTM will collect compensation information for the president and executive team of peer institutions from IRS Form 990, The Chronicle of Higher Education, and other public documents for the past three years. The compensation data, as well as peer institutional data, will be compared as a means of identifying trends to make informed judgments about compensation.
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4. Renewal: The value-added aspect of the PTM Executive Compensation and Evaluation Model is its emphasis on systemic response to the public demand for accountability and transparency, while simultaneously creating a culture of continual improvement by using the results of the presidential evaluation to enhance presidential performance.
Recognizing the economic restraints facing all colleges and universities, PTM is able to offer the executive compensation study for $6,000 and the presidential evaluation for $7,500. For institutions that contract for both the compensation study and evaluation, the total cost will be $12,000.
PTM – Proactive Transition Management
153 Red Tail Hawk Loop – Pawleys Island, SC 29585
(843) 325-0983 Office – (843) 235-2679 Fax – web site www.ptm.bz
Dr. Peter T. Mitchell, President – e-mail peter@ptm.bz
