University of California Office of the President

May 18, 2006

STATEMENT REGARDING PRESIDENT ROBERT C. DYNES BY CHAIRMAN GERALD L. PARSKY ON BEHALF OF THE UNIVERSITY OF CALIFORNIA BOARD OF REGENTS

The Regents of the University of California wish to affirm our support for President Robert C. Dynes.

In recent weeks, The Board reviewed in detail three audits and a plan to address the independent Task Force report on compensation. These four reports, taken together, represent the most thorough scrutiny of university compensation policies and practices ever conducted. We had a frank discussion with President Dynes on his understanding of how the violations of policy have occurred, both historically and on his watch, and the importance of ensuring that the University be transparent, accountable and fair in compensation matters while at the same time providing competitive compensation to sustain the quality of the University in years to come.

The Regents hold President Dynes accountable for the University’s compensation problems and he has acknowledged his responsibility. After our in-depth discussion with him on these issues, however, we are convinced that he understands the dimensions of the problem, the context in which these problems occurred, and the institutional barriers that must be overcome to ensure lasting reform. He presented an acceptable set of recommendations that provide us assurance that he is the appropriate leader to resolve these issues and guide the University through this difficult chapter in its history.

Moving forward, The Regents will not rely on voluntary compliance or promises of reform. The Regents will increase our oversight to correct the deficiencies that have been identified and will play an active role in creating a world-class management and financial structure.

To that end, The Regents have taken several actions:

First, we will move swiftly to correct deficiencies in the financial and administrative structure of the University. The Regents will lead a restructuring of the Office of the President and will actively work with President Dynes to recruit new senior executives.
Second, we have established a Compensation Committee to provide direct oversight over university compensation matters and to assure that our future actions are transparent, accountable and fair.
Third, we have created a Compliance Office reporting directly to The Regents and dedicated to assure compliance with Regental and all other University policies, across all operations.

Taking all things into account, The Regents are convinced that President Dynes can correct the compensation problems confronting us, and will implement a long-range vision for the University that ensures both its continuing academic quality and its ability to meet the needs of California and its people.

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