Name and Shame: A New Initiative Tracks Undue Donor Influence at Universities

One of the more problematic byproducts of the higher ed fundraising boom is the proliferation of “strings-attached” gifts in which a donor is given a say in university decision-making, potentially jeopardizing an institution’s academic independence and reputation. Complicating matters is the fact that those concerned with undue donor influence can’t fall back on an established framework to objectively gauge the propriety of such arrangements.

What constitutes inappropriate donor influence? To what extent, if at all, should donors have a say in funded academic research? Who defines the norms pertaining to such agreements?

To answer some of these questions and push back against rising donor influence on campus, Samantha Parsons, co-founder of UnKoch My Campus, along with professors David Rapach and Bonnie Wilson of St. Louis University have launched the Academic Capture Warning System (ACWS), a repository of information on “clear violations of well-accepted academic norms involving financial donations to institutions of higher education.”

“Just as regulatory capture contributes to crony capitalism,” the site reads, “academic capture contributes to crony philanthropy. Crony philanthropy undermines the ability of our institutions of higher education to promote the public good.”

The database is still under construction, but it nonetheless provides much-needed transparency into the world of “strings-attached” giving. And with the higher ed fundraising boom showing no signs of slowing down, even as universities cope with government budget cuts, we can expect to hear more about undue donor influence in the future.

A Long List of Controversies

Controversies involving undue donor influence include George Mason University’s opaque agreements with the Charles Koch Foundation, Henry and Susan Samueli’s $200 million gift to UC Irvine earmarked for integrative medicine, the Engelstad Family Foundation’s revocation of a $14 million pledge after the University of Nevada Las Vegas’ Board of Regents pushed out then-President Len Jessup, and the Pearson Family Members Foundation’s decision to sue the University of Chicago to recoup its donation, alleging the university kept the Pearson brothers in the dark about key hiring and planning decisions. 

The ACWS press release also cites similar controversies at Florida State University, the University of Kansas, Case Western Reserve University, Carleton University, and Chapman University.

We’ve been keeping an eye on developments involving a $50 million gift from Rex and Jeanne Sinquefield to St. Louis University (SLU). The gift originally stipulated that Rex would have a role in selecting the director of the new Sinquefield Center for Applied Economic Research, prompting an outcry from faculty members led by Rapach and Wilson, who argued that donors shouldn’t be involved in hiring and funding decisions. When we last revisited the SLU controversy in February, the Sinquefields-funded SLU Research Institute approved 15 faculty-submitted proposals.

According to Rapach, the SLU controversy served as the impetus for creating the ACSW.

Integrity is Vital

Here’s how Rapach, Wilson, and Parsons have laid out the rationale for ACSW’s work:

Public trust in the integrity of scholarship is vital if the academy is to advance the public interest. Undue financial donor influence has the potential to bias scholarship and compromise truth-seeking, thereby undermining public trust. In particular, researchers funded by donors granted inappropriate influence are less likely to be wholly independent, so that the integrity of their scholarship is more likely to be called into question.

Norms of academic freedom and institutional independence—sustained by the practice of faculty governance over academic matters—have historically safeguarded the integrity of scholarship and promoted public trust. By violating well-accepted academic norms, inappropriate financial donor influence erodes public trust and diminishes the value of academic research to society.

To that end, “key purposes” of the ACWS include:

• Raising awareness and informing the public about research that is at heightened risk of inappropriate influence by financial donors

• Encouraging researchers, university administrators and fundraisers, and donors alike to carefully consider the role of academic norms in protecting the independence of academic research and advancing the public good

• Encouraging individual researchers, as well as colleges and universities as a whole, to be transparent regarding funding sources and the role of financial donors in their work

• Alerting funding agencies (e.g., the National Science Foundation) and journal editors of proposals and papers that warrant extra scrutiny because the research was funded by donations that violated well-accepted academic norms

A Call for Greater Transparency

The creation of the ACWS is happening as universities attempt to come to terms with other unsavory consequences of the higher ed fundraising boom. The most obvious analog is how universities should handle “toxic donors.” In a piece looking at tainted donations in the higher education space, I quoted Robert O’Neil, a former president of the University of Virginia, who argued that schools should consider the extent to which the recipient's alleged actions come into “significant conflict” with the university's ideals.

And so the ACWS creators have articulated what constitutes “inappropriate donor influence.” Not everyone may agree with the thinking here, but it’s a constructive starting point. The trio identifies two broad categories of the most common types of inappropriate donor influence as described in the ACWS’s founding document:

1. Financial donor influence in hiring decisions. Such influence can take the form of a donor requesting that a specific individual be hired by a department, center or institute that is part of a college or university. It can also manifest in a donor (or a donor representative) serving on a committee that reviews candidates or provides approval for the funding of a position for a specific individual in a department, center or institute that is part of a college or university.

2. Financial donor influence in individual research projects. Influence in this context entails a financial donor providing direction and/or funding approval for individual research projects conducted under the auspices of a department, center or institute that is part of a college or university in violation of institutional independence.

Again, this all sounds obvious, but it’s worth laying out for no other reason than the fact that at universities like SLU, donors do have an influence in hiring decisions and research priorities.

A Focus on Reputational Risk

At the end of the day, the ACWS aims to “change incentives” by “bringing attention to organizations and individuals who do not adhere to basic principles of academic independence and integrity.” In doing so, the database could heighten the opportunity costs incurred by universities that choose to accept strings-attached donations.

It’s an issue we explored while looking at the SLU case study. In 2017, SLU leadership made growing its investment in research and scholarship a “major priority,” pledging to double its research budget to $100 million over the next five years. Given the high-stakes nature of this operation, the school was more than happy to accept the Sinquefields’ $50 million strings-attached gift. “We haven’t ever been through this kind of fundraising campaign. It will be a learning experience, and there will be bumps along the way,” said Vice President for Development Sheila Manion.

But accepting such a gift can be myopic and counterproductive. The strength of a university’s research program hinges on its academic independence. How can an aspirational school expect to compete with premier American institutions if its research is perceived as compromised by intrusive billionaire donors?

“The risk of suffering reputational damage by failing to adhere to well-accepted academic norms in financial donations significantly raises the costs of accepting such donations, thereby helping to make them less likely,” the ACSW document reads. “The alerting of funding agencies and journal editors to research funded by donations that violate well-accepted academic norms also raises the costs of accepting such donations.”

It’s hard to say how scary a watchdog like this might be to campus leaders, especially when weighed against the age-old imperative of wooing big donors. But in this populist age, with universities under growing scrutiny for their coziness with the .01 percent, more bad press on this front isn’t what any school wants.

In part, the ACWS’ bite will depend on the quality of its information and how well it pushes stories of compromised universities to the media. The group says that its database, an early version of which launches this summer, “will provide information on organizations and individuals that have engaged in clear violations of well-accepted academic norms involving financial donations.” In the future, the database will also include a library of “model policies designed to help colleges and universities avoid undue donor influence,” as well as “examples of donors who support public trust in the integrity of scholarship by choosing to abide well-accepted academic norms in their giving.”

In the meantime, its creators encourage anyone with information regarding such activities to submit tips via email at acws@academiccapture.org.