By Fran Singh and Gemma Meredith

Former vice-chancellor Malcolm Gillies. Photo: City University CPM

The removal of former vice-chan­cellor Malcolm Gillies will cost the university well in excess of £500,000.

According to the university’s ac­counts, Prof Gillies, who left City last year, was paid £426,000 “compensa­tion for loss of office and pension con­tributions”.

In addition, the report that is widely believed to have prompted Prof Gillies’ departure cost the university over £40,000.

Egon Zehnder International (EZI), the consultancy firm that authored report, is now charging the uni­versity to assess a shortlist for a fee of £9,500 per candidate.

The company recommended it be kept on a monthly retainer and the university confirmed that EZI has also advised the appointment committee on potential “lateral candidates”. The fees for these services are unknown.

These charges come on top of an undisclosed fee to a second recruit­ment consultancy firm. Perrett Laver is conducting the executive search for a replacement. Top business headhunt­ers routinely take 20-30 per cent of annual salary packages fees. Prof Gillies had a salary of £258,000.

As well as the financial costs, the continued involvement of EZI has prompted concerns of a conflict of interest over the appointment of a new vice-chancellor.

The reasons behind Prof Gillies’ departure from City last August remain unclear but minutes from the meeting in which he resigned point to EZI’s report as a significant reason.

According to the minutes, the vicechancellor made representations to the council, and then left the room.

“Council members debated the report and at various points sought advice from Egon Zehnder.

“The council agreed unanimously that there were differences with the vice-chancellor on matters of governance and that it was therefore in the best interests of the university that he step down.”

Prof Gillies then resigned on the spot. He has since been appointed vice-chancellor of London Metropolitan University. The wording of the minutes and the subsequent compensation paid to Prof Gillies suggest that he was given no choice but to resign.

At the time of his resignation an academic said: “He’s not the resigning type. He was really enjoying the job and was the best thing that’s happened to our university in terms of staff morale and refocusing on students and learning.”

According to the Times Higher Education, the university has refused a request to release the report under the Freedom of Information Act on the grounds that it contains personal information.

Ironically, in a letter to board member Cherry Freeman explaining the firm’s charges to advise on the appointment, an EZI employee refers to the fact that “recent experience has demonstrated the difficulties and substantial costs associated with thewrong appointment”.

An associate of Prof Gillies says he was very surprised and thought it was highly unecessary that there are two headhunters involved in the recruitment process.

A spokesman for the City branch of the University and College Union has voiced concern about EZI’s role in Prof Gillies’ departure and the appointment process. The union “considers it essential that City management ensures there are no conflicts in the appointment procedure and that any selection process is transparent,” he said.

In a statement prompted by the Inquirer, university secretary Frank Toop said: “The university council does not believe that EZI has any conflict of interest.”

See what the Inquirer says – Fran Singh’s editorial comment