Yale’s money man took home a healthy raise last year, while the University’s President is poised to hold onto his crown as the highest-paid president in the Ivy League.
A 21 percent raise for Yale Investment chief David Swensen GRD ’80 pushed his salary over $2 million for the first time in 2006, according to the University’s most recent tax filings. Swensen’s take topped that of University President Richard Levin, who, with $973,277 in compensation and benefits, was the University’s fourth highest-paid employee.
Last year, Levin — the longest-serving of the sitting Ivy League presidents — was also the highest paid of the eight, and with this 10 percent raise, he is likely to be so again.
Two other University employees earned over $1 million in 2006. Swensen’s deputy, Dean Takahashi ’80 SOM ’83 got a 6 percent raise, bumping his compensation and benefits package to $1.8 million. School of Medicine professor David Leffell received nearly $1.2 million, up two percent from 2005.
Swensen’s and Takahashi’s exact earnings for the 2006 calendar year are difficult to pinpoint since their payment includes deferred bonuses not yet vested as well as past deferred compensation, previously listed on tax filings, that has now vested. The most recent filing reports Swensen’s compensation as $2,041,270, plus $1,034,433 in benefits and $20,325 in expense accounts, for a total of $3,096,028. Takahashi’s compensation was $1,219,020, plus $625,540 in benefits, for a total of $1,844,560.
Most of their compensation consists of incentive-based bonuses they receive on top of their base salaries, mostly tied by the long-term performance of Yale’s $22.9 billion endowment. In 2006, the endowment grew a nation-leading 28 percent.
Swensen’s and Takahashi’s pay trails that of counterparts at the Harvard Management Company, who have earned as much as $35 million in recent years. Yale outsources the direct investment of its endowment to external financial managers, whose pay is not publicly disclosed.
Yale’s fifth and sixth highest-paid employees in 2006 were dermatology professor Jennifer McNiff, with $925,242 in compensation and benefits, and pathology professor Earl Glusac, with $905,554.
School of Medicine professors tend to have higher salaries because of market forces, said the school’s dean, Robert Alpern, who determines their compensation. Yale’s salaries have to be competitive not only with other medical schools but with private medical practices.
While the University can’t match potential private sector earnings, there’s a limit to how much it can expect doctors or economists to give up financially by staying in academia, he said.
Alpern added that the highest-paid professors earn their salaries by generating significantly more revenue for the School of Medicine and Yale-New Haven Hospital.
“The people who get the highest salaries here are the ones who we make the most money off of,” Alpern said.
The same goes for Swensen and Takahashi, who have made millions for themselves but billions for Yale. The two have seen raises in the past to keep them at Yale when they could surely earn more in the private sector.
Levin’s salary is recommended by the three-person Compensation Committee of the Yale Corporation, the University’s highest governing body.
Federal law requires nonprofit organizations like Yale to disclose annually the compensation of its officers and its five other highest-paid employees. Yale’s six officers besides Levin — the University’s secretary, general counsel, provost and vice presidents for New Haven and state affairs, development and finance and administration — earned $465,000 on average in the 2006 calendar year.
Overall, Yale spent $1.2 billion on salaries and benefits for the equivalent of 11,400 full-time faculty and staff positions in 2006, or about half of all functional expenses, according to the report. In 2006, the average tenured Yale professor earned $151,152, an increase of 3.8 percent over the previous year, according to the Chronicle of Higher Education.
Swensen, McNiff and Glusac declined to comment. Levin, Leffell and Takahashi did not respond to requests for comment.