Board acts on compensation
BY CYNTHIA LEE
Today Staff Writer
Faced with harsh criticism of the way executive compensation has been handled, the UC Board of Regents moved forward with a top priority — to strengthen its oversight of senior compensation and support public disclosure.
“The regents have full confidence after extensive discussions that President Dynes understands [our] concern and shares with us the commitment to addressing the problems that face this university,” chairman Gerald Parsky told the board, meeting in Covel Commons March 16.
The sweeping reforms will include a reorganization of the Office of the President (OP) to strengthen business practices and management. An independent compliance officer who will report directly to the regents will be hired to make sure administrators comply with policies and practices. A chief operating or administrative officer and a chief financial officer with responsibility for nonacademic functions may be added.
Another recommendation, said Regent Joanne C. Kozberg, co-chair of a task force looking at all aspects of compensation, is to hire an ombudsman to respond to the public’s requests for information.
Last month, the Senate Education Committee and its Budget Subcommittee on Education called on Parsky, Dynes and other UC leaders to answer for lapses regarding compensation.
Dynes told legislators he took full responsibility “for the fact that the University of California has not always met its obligations to public accountability in matters of compensation and compensation disclosure. And I believe I owe you, the members of the Legislature, an apology for that shortcoming.”
In her presentation before the board March 16, Judith Boyette, associate vice president for human resources, apologized for failing to provide the regents with timely reports listing the salaries and benefits paid to UC senior officers and managers at OP and the campuses. “I deeply regret this failure, and I want to apologize to the regents and the public,” she said. She described the lapse as a “failure in control processes.” The two reports for 2003-04 and 2004-05 were recently posted at www.universityofcalifornia.edu/regents/regmeet/mar06/4c.pdf.
Boyette said her office will use a systems-driven tracking process to make sure reports are filed on time. She also said the reports contain errors because the financial information is manually gathered across the system. Her office is working on updating the system so that the data can be drawn directly from payrolls. Once corrected, the reports will be reissued, she assured the board.
While the state is auditing UC compensation, the regents have hired auditors to perform their own 10-year review and have commissioned an independent task force to examine compensation policies and practices.
Among the areas being focused on are:
• Conflicting and overlapping compensation policies that are confusing
and unclear;
• Possible conflicts involving compensation paid to officers of the university for their service on corporate boards;
• A policy that would allow the UC to reduce or eliminate terms of a separation agreement if the employee violates university policy or law;
• A policy that states that all capital projects for the chancellors’ homes and offices costing more than $25,000 require the president’s approval. If projects over that threshold are proposed for the president’s home and offices, then the regents must sign off.
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