What does a small, private women’s liberal-arts college in rural Virginia have in common with a highly selective, private engineering, art, and architecture school in New York City? The answer is that the attorneys general of each state recently intervened to completely restructure the governance of both institutions — in the face of severe financial problems.
In the case of Sweet Briar College, the Virginia attorney general \”saved\” the college in June by negotiating for the wholesale replacement of the board and the college’s leadership, thus at least temporarily staving off plans to close the college. The trump card he played was to use his authority to allow the college to spend down $16 million of previously restricted endowment principal in return for a pledge from alumnae who had sued the board to raise $12 million to bridge the college’s short-term financial needs.
Consistent with the actions of his Virginia counterpart, the New York attorney general also intervened to pressure the Cooper Union for the Advancement of Science and Art to revise and expand its Board of Trustees. He then brokered a settlement of a lawsuit brought by alumni, faculty, and students who claimed that the board’s financial mismanagement had led to the imposition of tuition at the previously tuition-free institution, allegedly in violation of the college’s charter.
Under the terms of the settlement, announced last week and awaiting a state court’s approval, the board agreed to expand its membership to include student trustees, additional alumni trustees, and faculty and staff representatives. In addition, the board agreed to accept an independent financial monitor, to be appointed by the attorney general, and promised \”transparent disclosure of board materials, budget documents, and investment results.\” The board also agreed to additional governance reforms and to the \”development of a strategic plan to return the school to its traditional tuition-free policy.\”
As was the case with Sweet Briar, the agreement was greeted by disgruntled alumni as close to a complete victory. In each case, it is nothing of the kind.
While Sweet Briar will live to see another day, it remains far from clear whether a new president and a new board will be any more successful at increasing enrollment, reducing the discount rate, and eliminating a stubborn budget deficit than was the old regime. And whether they can accomplish all this while retaining the character of the \”old Sweet Briar\” revered by its graduates is also far from certain. To be sure, they will try, and we wish them well. But the attorney general’s actions only changed the governance structure; they did not address the underlying challenges that gave rise to the prior board’s gut-wrenching decision to close the college in the first place.
Cooper Union’s situation is quite similar. Stated simply, Cooper Union lacks the revenue to sustain its existing cost structure without charging tuition, and changing the board membership will not alter this reality. In fact, expanding the board to include students, faculty, and staff may actually make it harder, not easier, to confront hard choices. Student trustees are unlikely to ever support instituting tuition. Similarly, faculty and staff are likely to resist efforts to control costs either by reducing head count or by trimming salaries and benefits (or by increasing teaching loads). Conflicts of interest are built into this structure.
And while transparency seems like a noble aspiration, it is very difficult for academic institutions facing hard choices to be truly open about the choices on the table without provoking protest from those who seek to preserve the status quo. Colleges are often characterized as bastions of liberalism but, in fact, their three key constituencies — students, faculty, and alumni — tend to be quite conservative when confronted with the need for change. When tradition meets unsustainability, tradition must yield, but it rarely does so without a fight. And in these days of social media, local squabbles on even rural campuses can quickly escalate into national news stories.
We are deeply troubled by the willingness — indeed enthusiasm — for intervention into the governance of these two private institutions by ambitious elected officials who may be more concerned about how their \”settlements\” play in the press than how they actually affect the ability of the colleges not just to survive, but to thrive. Long after the last news conference is held, the boards of Sweet Briar and Cooper Union will face the same inconvenient truths that produced difficulties for their predecessors. Simply mandating transparency, new board membership, and ousting presidents will not make thorny, difficult problems go away.
Certainly, there should be mechanisms for evaluating decisions of boards, but reasonable standards should be applied and expeditious ways need to be identified to address the societal need for checks and balances. It is often tempting to examine past decisions — in the case of Cooper Union, to construct a new building, to invest in hedge funds, or to negotiate a new lease on the Chrysler Building, whose land the college owns — with the benefit of perfect hindsight. But while every decision comes into sharper focus in the rear-view mirror, boards making decisions in real time are not afforded this luxury, even if attorneys general conducting investigations are.
We fear that if the cost of being wrong is public ridicule and criticism by politically motivated elected officials, able people with strong reputations and many alternatives for the use of their time will not be willing to serve on the boards of institutions like Sweet Briar and Cooper Union at precisely the time when their talents are most needed.
Running a college or university is not for the faint of heart. Providing courageous leadership is not made any easier by the fact that most people who went to college seem to think they can run one. The alumni and others who sued Sweet Briar and Cooper Union now find themselves in positions of responsibility. And like the dog who chased and caught the proverbial bus, they are about to discover that it is far easier to be an advocate if you never have to actually take responsibility for a decision.
We sincerely hope they succeed in righting their respective ships, but if they do, it is likely to be in spite of and not because of the actions of their respective attorneys general.
Author Bios: Lawrence S. Bacow is president emeritus of Tufts University and leader in residence at Harvard Kennedy School. William G. Bowen is president emeritus of Princeton University and founding chairman of Ithaka.