Windfalls for departing bosses – robust arrangements for remuneration and performance management

There has been a lot of debate about the pay-off received by the Northern Rock chief executive, Adam Applegarth. These issues are relevant to the public sector too. Earlier this year we had the £75,000 payment to the chief executive of the “superbug scandal” Maidstone and Tunbridge Wells NHS Trust. Now the Yorkshire Post reports that Principal of Doncaster College has been given a compensation package of £163,000 after seven months doing the job and eight months being suspended.

Boards in the public and third sector must remember that hiring and firing chief executives is central to their role – so they need to have robust arrangements for remuneration and performance management.