Shawn Kelley | In defense of the president

A Vet-ted Mind | Not only is Gutmann's salary justified, it is also undervalued

By Shawn Kelley 09/18/14 12:01am

A co up le of weeks ago, The Daily Pennsylvanian ran a story on President Amy Gutmann’s salary. That morning, I was passing out papers at the Quadrangle and got to gauge reactions. The next several days, I heard and was involved with discussions about this story. I’ve heard quite a few attacks — most of these concerning giving some of that money to financial aid — and relatively few people defending.

There are a couple reasons why I feel President Gutmann’s salary is well-deserved.

First, let us look at how much other university presidents are being compensated. Among private universities, Gutmann’s salary ranked sixth . In the top five are Lee Bollinger and Robert Zimmer , presidents of Columbia and the University of Chicago, respectively. Mr. Zimmer tops the list at $3.5 million . However, if you also add in public universities, then even Mr. Zimmer’s seems paltry compared to the $6 million claimed by former Ohio State President E. Gordon Gee .

What’s really telling is when you look at the compensation per $1 million in total expenditures for each institution. Gee was paid $1,332, Zimmer received $1,113 and Gutmann $376.

Now take into consideration that Penn’s budget, at $5.6 billion , was greater than any other university that was included in The Chronicles of Higher Education’s analysis. For further comparison, the GDP of Monaco is $6 billion . This demonstrates how Penn can be compared to a small country in terms of complexity and economic output. With its health system, police force and 12 schools, Penn has an estimated economic impact of $14 billion — about the GDP of North Korea.

Another measure is what President Gutmann’s peers in the corporate world are earning. I don’t feel I am making a large leap in considering her peers to be CEOs of S&P 500 companies. According to the AFL-CIO, the overall average CEO pay at S&P 500 Index companies in 2012 was $12.25 million . Now let’s factor in that women in that position are, on average, paid 18 percent less than their male counterparts: $10 million . Suddenly $2 or 3 million doesn’t seem fair at all.

Let’s take a look at what Gutmann has done for Penn.

She has been an outspoken advocate for increased access to higher education among lower- and middle-income families. This has been an issue she has fought for extending back to when she was vice provost at Princeton under Harold Shapiro , who fought for the same access.

Penn has one of the best financial aid packages among private universities. There are many students here who would not be able to attend Penn, or any other Ivy League institution, if it were not for the efforts of President Gutmann.

She has also helped to increase the prestige of the university by expanding the faculty and scope of the schools. Not only have new centers for education and research been opened, such as the Smilow Center for Translational Research and the Krishna P. Singh Center for Nanotechnology , but the barriers restricting interdisciplinary communication have been gradually removed.

Penn also gains prestige for the many activities Gutmann undertakes. She is Chair of the Presidential Commission for the Study of Bioethical Issues and Vice Chair of the Association of American Universities . She also serves on the National Commission on the Humanities and Social Sciences as well as, the boards of the National Constitution Center and the Vanguard Group .

President Gutmann played a key role in the Making History campaign, Penn’s largest and most successful fundraising endeavor, which raised an additional $4.3 billion .

Considering all of this, it seems Gutmann’s salary is justified. She has performed her job more than admirably. She has increased financial aid, prestige and resources while being compensated a fra ction of what her peers are. One could argue that perhaps she even deserves a raise.

Shawn Kelley is an LPS sophomore studying history and Japanese. His email address is skelley@sas.upenn.edu. “A Vet-ted Mind” appears every other Thursday.

Please note All comments are eligible for publication in The Daily Pennsylvanian.