Nine recommendations for joint action by institutions of higher education, states, and school districts to prepare, select, and reward principals are proposed and discussed in this booklet. The booklet's introductory pages note the changes in the principal's role that have resulted from the new demands placed on education by reform efforts. The fact that principals have not received training for their new responsibilities is underlined. The booklet then turns to the specific proposals and the ways that institutions of higher education and state agencies can join with school districts to meet the new demand for more qualified administrators. The recommendations include (1) establishing state standards for principals' knowledge and skills, (2) creating local district programs for preparing staff members to become administrators, (3) reviewing and improving professional education for administrators, (4) certifying principals on the basis of skills and knowledge, (5) requiring districts to establish comprehensive employment selection methods, (6) evaluating principals using a statewide system, (7) establishing state and local incentive pay programs for administrators, (8) providing for continuing education for principals, and (9) making development of school principals a high priority goal of educational groups. (PGD)