Annual Report of the Remuneration Committee 2023-24
Source: https://www.leeds.ac.uk/about/doc/annual-report-remuneration-committee-2023-24 Parent: https://www.leeds.ac.uk/structure-governance/doc/reports-accounts-policies
A. Introduction
The Remuneration Committee is a formal committee of the University Council.
This report outlines the responsibilities of the Committee, and its key activities and decisions during the year to 31 July 2024, in accordance with guidance provided by the Committee of University Chairs (CUC).
Terms of reference
The Committee reviewed its terms of reference and schedule of meetings and business during 2023/24. This included a benchmark with other universities and taking consideration of the remits of other Council and Executive committees. The current Terms of Reference which align with the CUC Guidance are as follows:
- In the light of comparative information on any salaries and other benefits and conditions of service in the sector and taking into account the University’s interests and the public interest, to review annually and to determine the remuneration of the Vice-Chancellor & President and all other members of the University Executive Group.
- To receive appropriate information on additional external income accruing to the Vice-Chancellor & President and other members of the University Executive Group, and to consider the appropriateness of the policy on external income.
- To set the reward framework for senior post holders and to receive a report from the Professorial and Senior Staff Salary Review Committee.
- To note annually any salary increases which take a member of staff’s total remuneration package above £100,000, whether as an explicit retention decision or otherwise.
- To note annually recruitment involving total remuneration packages above £100,000.
- Taking into account both the University’s interests and the public interest, to advise the Council on any proposed severance settlement for the Vice-Chancellor and President; to approve any proposed severance settlements for other members of the University Executive Group; and to note severance settlements for other members of staff whose total remuneration package is over £100,000.
- To review annually the gender pay gap and other available equality, diversity and inclusion analyses and to reflect how any issues might best be addressed in senior appointment and reward processes.
- To report annually to the Council. The annual report will comply with the requirements of the OfS Accounts Direction and the CUC Code and Guidance
- To review its terms of reference annually.
The annual review of the Terms of Reference is to ensure that they remain appropriate and compliant with relevant legislation, codes and other current guidelines, and to confirm that the focus of the Committee’s work has addressed these priorities.
Frequency
The Committee meets at least three times each year and arranges additional meetings as appropriate and required.
Membership
The Committee consists of five lay members of Council. For the period of this report the membership was as follows:
- Chair: Helen Grantham
- Chair of Council: Alastair Da Costa
- Three other lay nominees of Council: Seb Elsworth, Iain Moffatt (to 31 July 2024), and Ken Sargison. From August 2024, Janet Sheriff joined the Committee.
It is the responsibility of Council to ensure that the membership of the Committee has the necessary skills, experience and support to meet the Committee’s responsibilities. The current membership of the Committee meets this criteria. The Committee undertakes an annual review of its own effectiveness.
The Chair of the Remuneration Committee is appointed by the Council and is an independent member of Council other than the Chair of Council. The Committee can, if it so wishes, call upon external advisers as appropriate. The Vice-Chancellor & President, University Secretary & Registrar and the Director of People & Culture Officer (or nominee) are not members of the Committee, but attend as follows:
The Vice-Chancellor & President only attends for agenda items that relate to their role as line manager of Executive members, and to enable the Committee to ensure full consideration of individual performance and organisational strategy when considering remuneration-related decisions. The Vice-Chancellor & President is not present for any matters that affect their own remuneration.
The University Secretary & Registrar and the Director of People & Culture (or nominee) advise the Committee but are not present for any matters that affect their own remuneration. The University Secretary & Registrar is the formal secretary to the Committee. The Director of People & Culture was not a member of the University Executive prior to November 2024.
B. Operating Environment 2023-24
During 2023-24 the University had a change of Vice Chancellor & President.
Professor Hai Sui Yu was appointed Interim Vice-Chancellor & President from 1 November 2023 and has led the ongoing implementation of the University’s Strategy 2020-2030: Universal Values, Global Change. This includes three over-arching areas of Community, Culture, and Impact; supported by an enabling strategy. The University Strategy is underpinned by a Vision to create a fairer future for all, and agreed institutional Values - Inclusivity, Integrity, Collaboration and Compassion. The scale and pace of change required in delivery of the strategy is significant if its aims are to be achieved. The University’s new Vice-Chancellor & President, Professor Shearer West, took up office on 1 November 2024.
During the reporting period, the University has continued to encourage staff to return to on-campus working. The cost of living crisis, recovery from the impact of industrial action and responding to student protests relating to events in the middle east have also impacted the University and sector.
C. Principles and Approach to Senior Remuneration
The University recognises the value of the Committee of University Chairs (CUC) Higher Education Senior Staff Remuneration Code and the Remuneration Committee seeks to ensure compliance with the Code through consistent application of a University Executive Group Reward Framework and Principles which is reviewed at least annually by the Remuneration Committee.
The Remuneration Committee has direct responsibility for determining remuneration and reward-related matters for the Vice-Chancellor & President and all other members of the University Executive Group. These are executive positions that report directly to the Chair of Council, the Vice-Chancellor & President or the Provost & Deputy Vice-Chancellor. For the period of this report the Group consisted of the following:
- Professor Simone Buitendijk - Vice-Chancellor & President (to 31 October 2023)
- Professor Hai Sui Yu – Provost & Deputy Vice-Chancellor; and Interim Vice-Chancellor and President (between 1 November 2023 to 31 October 2024)
- Professor Jeff Grabill – Deputy Vice-Chancellor: Student Education
- Professor Nick Plant – Deputy Vice-Chancellor: Research & Innovation
- Jennifer Sewel – University Secretary and Registrar
- Jane Madeley – Chief Financial Officer
- Rachel Brealey – Chief Operating Officer
- Professor Andrew Thorpe – Executive Dean: Faculty of Arts, Humanities and Cultures
- Professor Karen Birch – Executive Dean: Faculty of Biological Sciences
- Professor Julia Bennell – Executive Dean: Leeds University Business School
- Professor Nora De Leeuw – Executive Dean: Faculty of Engineering & Physical Sciences
- Professor Selina Steed - Executive Dean: Faculty of Environment (to 31 January 2024)
- Professor Alan Haywood – Interim Executive Dean: Faculty of Environment (from 1 February 2024)
- Professor Mark Kearney – Executive Dean: Faculty of Medicine & Health
- Professor Paul Johnson – Executive Dean: Faculty of Social Sciences
In addition, the Committee receives updates on remuneration-related matters affecting other groups of staff at the University to enable it to fulfil its responsibility for ensuring that the organisation’s overall framework for remuneration is proportionate, appropriate, and enables the attraction and retention of talented individuals necessary to ensure the delivery of the University’s strategy and its ambitions.
The University of Leeds is a large and complex institution with around 40,000 students and around 10,000 staff and is among the UK’s largest universities. It has an annual turnover of almost £1bn. The University is a world top 100 university with a global reputation for excellence in teaching and research and requires high-performing, experienced leaders to continue its success and to meet its strategic ambitions. When considering matters of remuneration, the Remuneration Committee is required to balance many factors including the performance of the University, the global recruitment market and rates of compensation, the challenging financial circumstances facing universities, external perceptions of senior pay and internal equity factors.
To assist in delivering this balance, the Remuneration Committee considers data from a wide range of sources, including data from relevant HE-sector salary surveys (for both senior staff and Vice-Chancellors), benchmark data from external executive search and reward consultancies, regional data for comparable positions within relevant NHS and Local Authority organisations and data available on national pay trends.
When reviewing salary levels for both the Vice-Chancellor & President and members of the University Executive Group, the Committee applies the principles outlined in the University Executive Reward Framework and Principles. From August 2023 no members of the Executive remain contractually entitled to the nationally negotiated cost of living award, although in line with the CUC Code, the Committee will consider the nationally negotiated award when undertaking its annual review. Careful consideration is given to any additional awards for exceptional performance using available external benchmark data and the cost of performance awards across the University’s wider population.
Salaries
Salary determination at individual level on appointment and thereafter takes account of:
- The UEG Reward Framework and Principles in place at the time.
- Individual competencies, skills and experience, performance and behaviours: as determined by the role expectations measured against individual personal objectives agreed with the Vice-Chancellor & President or in the case of the Vice-Chancellor & President and the University Secretary & Registrar, determined by the Chair of Council in consultation with members of Council, including members of Remuneration Committee.
- Organisational performance and environment: University performance as determined against key internal and external indicators.
- Relevant market data on pay levels in comparable roles and organisations.
- Affordability: the budget available, in the context of the principles articulated above.
- Retention challenges: either at an individual role level, or across a particular professional or disciplinary field.
Bonuses
The University does not currently operate a bonus scheme for senior post holders however it is reviewing its approach taking account of benchmarking and specialist external advice. In line with the approach taken with the wider university staff population, exceptional performance by a member of the Executive, may result in the payment of a non-consolidated, non-pensionable recognition payment.
Pensions
Senior post holders are eligible to participate in a pension scheme under the same conditions that apply to all University staff. The Remuneration Committee reviewed its position on payments in lieu of pension supplements during the meetings held in July and November 2023 and February 2024, including consideration of a report and presentation on salary supplements in lieu of pension contributions commissioned from Mercers Higher Education Group. In evaluating the options and considerations, against the benchmark data, it agreed that salary supplements in lieu of pension scheme contributions should be considered on a case by case basis. The matter will continue to be reviewed periodically.
Benefits
The University does not as a rule, offer additional benefits such as private health cover, or car allowance payments as a standard part of the remuneration offer. The reward packages of all current members of the Executive are in line with this Policy.
Consultancy and External Income
The University has policies on External Income and Consultancy that apply equally to all staff. All senior post holders are required to declare any such income and the Remuneration Committee reviews any payments made and ensures compliance with the related Policy.
Expenses
There is a published University policy on Expenses for University Executive members.
D. Report on business conducted during 2023-24
During 2023-24, the Remuneration Committee held scheduled meetings in September, October and November 2023, and in February and July 2024 to carry out its responsibilities. In addition, members of the Remuneration Committee were consulted on any changes in the Executive Team including both leavers and new appointments and their remuneration.
Standing Agenda Items
The Committee addressed the following standing agenda items:
- Reviewed and updated where appropriate, its Terms of Reference taking cognisance of developments in sector guidance (e.g. CUC and UCEA).
- Reviewed and noted the data on recruitment and salary increases involving salaries in excess of £100,000.
- Reviewed and noted any severance payments made to staff earning in excess of £100,000 since 1 August 2023.
- Noted the data on external income accrued by members of UEG during the period 1 August 2023 to 31 July 2024 and reassured itself that any such income complied with the University’s Policies on External Income and Consultancy.
- Reviewed the gender, ethnicity and disability pay gap data and approved their publication. It also endorsed the proposed actions to assist addressing the gaps.
Additional Meetings and Agenda Items
The office of Vice-Chancellor and President: During 2023/24, the University undertook a rigorous international search and recruitment process for a new Vice-Chancellor & President. The Remuneration Committee met in September 2023 and agreed appropriate financial payments to the outgoing Vice-Chancellor and President, which are reported in the Financial Statements; and in considering a number of benchmarking information, it then agreed an appropriate indicative (for search purposes) salary range, and subsequently, a final remuneration package for the incoming Vice-Chancellor and President (from 1 November 2024).
Executive Objective Setting and Performance review: Following a successful trial and endorsement from the Remuneration Committee, a new UEG Objective Setting Template was introduced in October 2023. This was used to set SMART and measurable objectives for the 2023/24 session; aligning with the University Strategy and key performance indicators and underpinned by the UEG Reward Framework and Principles (see below). The Interim Vice-Chancellor & President presented an update on UEG performance at the February 2024 meeting, prior to providing a full performance assessment which was considered by the Remuneration Committee at its summer meeting.
University Executive Group Reward Framework and Principles: In response to Committee discussions, the Executive Performance Framework was revised and endorsed by the Remuneration Committee for the 2023/24 session. Using the Objective Setting Template approved at the October 2023 meeting, it was intended that the underpinning Framework would enable performance assessment (by line managers) of UEG members and provide the Remuneration Committee with a clear and consistent way of rewarding executive performance.
Professorial/Senior Staff Performance and Salary Review: The Committee reviewed the annual review process for professorial and senior staff in advance of the 2023/24 cycle of performance and salary review.
Severance and Non-Disclosure Agreements (NDA): At each meeting the Committee receives a report on any Severance NDAs entered into by the University, and as a matter of course the Chair of the Committee is consulted on any such agreements.
University Executive and Senior Management Team Changes: The Committee received updates on progress pertaining to new appointments and gave due consideration to the formal terms relating to them.
Remuneration Matters Relating to Senior Post Holders and the Vice-Chancellor and President
In consideration of the annual review of remuneration and reward for Senior post-holders by the Remuneration Committee, institutional performance is relevant to the Committee’s considerations. The Committee was mindful of the progress made by the University on implementation of the University Strategy during the period 2023/24 against the backdrop of financial challenges impacting the sector.
Performance
In line with usual practice, the Interim Vice-Chancellor & President reported to the Remuneration Committee on the performance of their Executive direct reports. The Chair of Council provided an overview of the Interim Vice-Chancellor & President’s performance and leadership and supplemented the report of the Interim Vice-Chancellor & President on the performance of the University Secretary & Registrar in respect of her statutory and regulatory responsibilities as Secretary to the Council. The Remuneration Committee agreed salary awards related to its assessment of performance against the set objectives and University values for all members of the University Executive.
Interim Vice-Chancellor & President
The Remuneration Committee reviewed the remuneration package of the Interim Vice-Chancellor & President at its meeting in July 2024. It reflected on his leadership and the performance of the University since taking up the interim position, and considered feedback gathered by the Chair of Council from members of Council.
The Remuneration Committee concluded that the Interim Vice-Chancellor & President had continued to progress the successful implementation of the University Strategy throughout a period of uncertainty within the University; delivering some significant improvements in community morale, as well as leading on several key initiatives, including NSS and staff engagement. In considering the benchmark information available, the Committee concluded that the Interim Vice-Chancellor & President be awarded a bonus payment of 6% and a separate salary uplift would apply to Professor Yu’s salary as Provost and Deputy Vice-Chancellor as he returned to that substantive role.
As required, the University has disclosed full remuneration details relating to the post of Vice-Chancellor & President in the Annual Accounts to 31 July 2024.
| Emoluments of the Vice-Chancellor and President Simone Buitendijk | 2023/24 £000 | 2022/23 £000 |
|---|---|---|
| Salary | 87 | 330 |
| Pay as outgoing Vice-Chancellor and President | 59 | 0 |
| Employer contributions to defined benefit scheme | 0 | 0 |
| Benefits in kind | 0 | 0 |
| Contractual post employment notice pay | 173 | Not applicable |
| Compensation for loss of office | 115 | Not applicable |
| Total | 434 | 330 |
The emoluments of the Vice-Chancellor and President represent in-year earnings.
| Emoluments of the Interim Vice-Chancellor and President Hai Sui Yu | 2023/24 £000 | 2022/23 £000 |
|---|---|---|
| Salary | 230 | Not applicable |
| Employer contributions to defined benefit scheme | 30 | Not applicable |
| Benefits in kind | 0 | Not applicable |
| Total | 260 | Not applicable |
The emoluments of the Interim Vice-Chancellor and President represent in-year earnings.
External income: The Vice-Chancellor & President and Interim Vice-Chancellor & President received no external income during the reporting period.
Expenses: The Vice-Chancellor & President (and Interim) complies with the University’s Expenses Policy, and information relating to their latest expenses claims can be found in the Governance section of the University website.
Pay ratios: The Office for Students requires universities to publish two key ratios to show the relationship of the remuneration of the Vice-Chancellor & President to that of staff within the institution. The methodology adopted is in line with paragraph 12d of the Office for Students Accounts Direction issued in October 2019.
The figures for all staff are as follows:
| Year | Basic salary ratio (Vice-Chancellor & President, Simone Buitendijk) | Total remuneration ratio |
|---|---|---|
| 2023/24 | 10.5 | 12.4 (impacted by loss of office payment) |
| 2022/23 | 10.8 | 9.6 |
| Year | Basic salary ratio (Interim Vice-Chancellor & President, Hai Sui Yu) | Total remuneration ratio |
|---|---|---|
| 2023/24 | 9.4 | 9.4 |
| 2022/23 | Not applicable | Not applicable |
In the interests of transparency, the University provides two further ratios to show the relationship of the remuneration of the Vice-Chancellor & President to that of employees within the university (a calculation that excludes individuals who are engaged on worker and/or agency contracts).
The figures for employees are as follows:
| Year | Basic salary ratio (Vice-Chancellor & President, Simone Buitendijk) | Total remuneration ratio |
|---|---|---|
| 2023/24 | 8.8 | 10.4 (impacted by loss of office payment) |
| 2022/23 | 8.6 | 7.8 |
| Year | Basic salary ratio (Interim Vice-Chancellor & President, Hai Sui Yu) | Total remuneration ratio |
|---|---|---|
| 2023/24 | 7.9 | 7.8 |
| 2022/23 | Not applicable | Not applicable |
Other higher paid staff
In line with the Accounting Standards requirements, the University publishes the basic salary of other higher paid staff (calculated on a full-time equivalent basis). The data for 2023/24 is prepared in accordance with paragraph 12a of the Office for Students Accounts Direction issued in October 2019. The requirements have been updated to include both basic salary and market supplements.
| Basic salary of other higher paid staff calculated on a full-time equivalent basis | 2023-24 number | 2022-23 number |
|---|---|---|
| £100,000 - £104,999 | 51 | 40 |
| £105,000 - £109,999 | 43 | 66 |
| £110,000 - £114,999 | 40 | 32 |
| £115,000 - £119,999 | 35 | 54 |
| £120,000 - £124,999 | 16 | 15 |
| £125,000 - £129,999 | 9 | 13 |
| £130,000 - £134,999 | 67 | 12 |
| £135,000 - £139,999 | 9 | 4 |
| £140,000 - £144,999 | 6 | 9 |
| £145,000 - £149,999 | 4 | 6 |
| £150,000 - £154,999 | 5 | 7 |
| £155,000 - £159,999 | 4 | 4 |
| £160,000 - £164,999 | 6 | 2 |
| £165,000 - £169,999 | 1 | 2 |
| £170,000 - £174,999 | 3 | 3 |
| £175,000 - £179,999 | 2 | 0 |
| £180,000 - £184,999 | 2 | 6 |
| £185,000 - £189,999 | 2 | 4 |
| £190,000 - £194,999 | 4 | 1 |
| £195,000 - £199,999 | 1 | 1 |
| £200,000 - £204,999 | 1 | 0 |
| £215,000 - £219,999 | 0 | 1 |
| £220,000 - £224,999 | 0 | 1 |
| £225,000 - £229,999 | 1 | 0 |
| £230,000 - £234,999 | 0 | 2 |
| £235,000 - £239,999 | 1 | 0 |
| £240,000 - £244,999 | 1 | 0 |
| £310,000 - £314,999 | 1 | 0 |
| £330,000 - £335,000 | 0 | 1 |
| Total | 315 | 286 |
Other matters: Remuneration of Interim Vice-Chancellor and President
In September 2023, the Remuneration Committee met to consider the Vice-Chancellor & President’s decision to leave the University at the end of December 2023 and the remuneration impact associated with this. In October 2023 the University Council agreed that, to facilitate an effective transition, the Provost and Deputy Vice-Chancellor Professor Hai Sui Yu, should adopt the role of Interim Vice-Chancellor & President and Accountable Officer with effect from 1 November 2023 and the Remuneration Committee agreed a suitable interim remuneration package to reflect this.
Chair of Remuneration Committee
November 2024\