Executive Pay in Academy Trusts: Why Benchmarking Matters More Than Ever

Setting executive pay has become one of the most closely scrutinised responsibilities of academy trust boards. Trustees must balance attracting and retaining high-quality leaders with demonstrating that remuneration represents good value for money and can withstand regulatory and public scrutiny.

A recently published executive pay benchmarking report provides academy trusts with additional market data to support these important decisions, but benchmarking should form just one part of a wider governance process.

Trustees Must Be Able to Justify Pay Decisions

The Academy Trust Handbook requires boards to ensure executive salaries are determined through a robust, evidence-based process. Pay should be proportionate to the responsibilities of the role and clearly documented so trustees can demonstrate how decisions have been reached.

Simply comparing salaries with other academy trusts is unlikely to be enough. Trustees should also consider factors such as:

• The size and complexity of the trust.

• Financial performance and sustainability.

• Educational outcomes.

• Leadership responsibilities.

• Future strategic objectives.

• Recruitment and retention challenges.

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A well-documented decision-making process helps demonstrate that remuneration has been considered carefully and objectively.

The Value of Benchmarking

Benchmarking remains an important governance tool because it provides context.

By comparing salaries with organisations of a similar size and complexity, trustees can better understand whether existing remuneration remains appropriate and competitive. Recent benchmarking data covering hundreds of academy trust CEOs and CFOs provides a useful evidence base for remuneration committees when reviewing executive pay.

However, benchmarking should inform decisions rather than determine them.

Every academy trust is different, and salary decisions should always reflect the individual responsibilities and circumstances of the organisation.

Documentation Is Just as Important as the Decision

Increasingly, regulators are focusing not only on the level of executive pay but also on how those decisions are made.

Trustees should ensure that board and remuneration committee minutes clearly record:

• The evidence considered.

• Any benchmarking information used.

• Alternative options discussed.

• The reasons for the final decision.

• How the package represents value for money.

  
  

Good governance is about being able to explain and defend decisions if they are ever questioned.

Looking Ahead

Executive remuneration within academy trusts continues to attract public and regulatory attention, and the government has signalled an increasing focus on ensuring leadership pay remains transparent and proportionate. Trustees should therefore expect executive pay decisions to remain an important area of governance.

Regular reviews, supported by appropriate market evidence and thorough documentation, will help boards demonstrate compliance with the Academy Trust Handbook while ensuring their leadership teams are fairly rewarded.

How SJC Can Help

Executive remuneration is about far more than salary benchmarking. It requires careful consideration of governance, financial sustainability and regulatory expectations.

At SJC, Chartered Accountants, we work with academy trusts to support financial governance, audit, compliance and strategic decision-making. We can help trustees review executive remuneration processes, assess benchmarking evidence and ensure decisions are properly documented and aligned with current guidance.

If your academy trust is reviewing executive pay or preparing for its next governance review, contact SJC, Chartered Accountants to discuss how we can help.