A newly graduated Oxford student. Photo by Stuart Franklin/Magnum


The begging bowl

British universities have a lot to learn about philanthropy – not least how to restrain its academic influence

by David Edmonds + BIO

A newly graduated Oxford student. Photo by Stuart Franklin/Magnum

For tourists of a philosophical disposition, there’s an unusual attraction at University College London: a glass box containing the founder of modern utilitarianism, Jeremy Bentham. In his will, Bentham had instructed that his body be dissected for scientific research, and that the skeleton, padded with straw and dressed in his own clothes, be left to sit in University College as though still engaged in thought.

Bentham died in 1832, but that didn’t prevent him from sending a recent letter to University College alumni. In it, he appealed for a donation to ‘help UCL continue to inspire radical thinking’. The great philosopher signed off the plea with the words: ‘Keep having radical thoughts. Your obedient servant, Jeremy Bentham.’

Accompanying the begging letter was a paper lantern that popped out to form a neat, if uncanny, simulacrum of Bentham’s head. This bizarre, kitschy approach towards asking UCL graduates for money is a dispiriting harbinger.

In Britain, as in much of the developed world, student numbers have been rising, and the Government is no longer willing or able to pick up the tab. Universities are having to seek alternative sources of funding. The biggest contribution will be from tuition fees, of course, but research grants, the renting of facilities, the hosting of conferences and the creation of satellite campuses and spin-off businesses will all add pounds, euros and dollars to the bursar’s bank account.

Then there’s philanthropy. Gifts from alumni and other benefactors currently make up a tiny percentage of total university funding in the UK, around two per cent. But they’re going to become increasingly significant — and will play their part in radically reshaping the education landscape.

Bentham devised a simple algorithm for how the nation’s institutions should be run: they should serve the greatest happiness of the greatest number. But the financial revolution in the university sector is raising some fundamental questions. What role will universities play in 21st-century society? Will they indeed serve the interests of the greatest number, or will they, instead, twist to accommodate the whims of their powerful benefactors?

It seems remarkable looking back: in the 1980s, when I attended university in Britain, not only were all fees paid for by the government, but most students received an almost liveable living allowance. All the statistics demonstrate that a university degree remains of enormous value to a person’s career and earning potential. Yet most of my contemporaries feel little gratitude to the institutions that moulded and launched them into the adult world.

By contrast, the top universities in the United States have managed a mysterious act of prestidigitation. They charge students tens of thousands of dollars to study, and then instil in these impressionable minds such a powerful sense of indebtedness that they feel obliged to continue to donate for the rest of their lives.

How have they pulled off this trick? At Princeton University tuition and living expenses are north of $50,000 (c£31,500) a year. Despite having an existing endowment of $17 billion (c£10.5 billion), 60 per cent of alumni make regular financial contributions to their alma mater. Each graduating class has a fundraiser, and the classes compete with one another to donate the most. In subtle, and not so subtle ways, the university nourishes this sense of belonging. There are alumni seminars and newsletters, garish jackets, and rousing Princetonian songs. There’s even a Princeton prayer that blesses, among others, the universities’ administrators.

The close bond between students and college goes right back to the ethno-religious origins of American universities. Education served to reinforce pre-existing identities. Princeton, for example, began principally as a Scots-Irish Presbyterian college. William and Mary in Virginia, the second oldest college in the nation, was Anglican. Georgetown in Washington DC, the nation’s first Catholic university, was founded in 1789. And although these old ethnic and religious ties to particular colleges have largely been broken, an aspect of the culture remains. Most Princetonians still feel like they belong to a distinct community. For some graduates, their Princetonian ‘badge’ is their most important identity, and thousands come back for annual reunions.

At key reunions, each class will donate millions of dollars. Almost every building on campus has a name branded on it: the name of a wealthy donor. Almost all are alumni. It’s not a bad way to secure a piece of family immortality. Woolworths might have been driven from the high street in the UK and the US, but the long-deceased Frank Winfield Woolworth at least has a music centre honouring him at this little academic paradise in New Jersey.

This looks more like an academic arms race in the battle of ideas than the impartial pursuit of truth and objectivity

One of the benefits of Princeton’s amazing stash of cash is that those from poorer backgrounds receive significant financial support. Several students told me that their fees were being met by the university in their entirety, and as a result they would be leaving Princeton at the end of their degree without any debt. Princeton can afford the best academics, the best laboratories, the best sports and drama facilities. Adam, a psychology major, told me he’d been flabbergasted by the generosity of the university. Within his first two months he’d been ‘sent to an amusement park, a Broadway show, and to Bermuda. They wowed me with the money that they lavished on us.’

Princeton’s faculty is made up of academics representing a cross-section of political views. But, essentially, it’s a liberal establishment. The US philanthropic tradition in the higher education sector has an unrecognised political consequence. Basically, it involves the extraction of money from (broadly) conservative donors to (broadly) liberal institutions.

Realistically, few universities in the world can aspire to Princeton’s financial success — there are unbridgeable cultural differences, and the Princetonian money-making machine has been honed over centuries. But in some ways, Princeton offers an idealised template, a standard by which others can assess themselves. The financial exigencies make it inevitable that all universities will be doing more of what Princeton already does so effectively — improving their links with alumni, and luring rich benefactors.

Though some academics wring their hands at this development, it’s nothing new. Many universities owe their existence to private philanthropy. The University of Reading was created from biscuits: it was built on a site donated by the Palmer family of Huntley & Palmers. Jesse Boot, of Boots, the ‘Chemists to the Nation’, was instrumental in the establishment of the University of Nottingham. The University of Bristol was set up with an endowment from Henry Overton Wills III, a tobacco importer and cigarette manufacturer.

Placing the inescapable future in its historical context might defuse some academic anxiety. Nonetheless, the role of higher education, and the relationship between student and university, is undergoing a process of fundamental transformation. This change carries huge risks according to Stanley Katz, an education expert and professor of public and international affairs at Princeton. Katz is an amiable and garrulous anglophile whose office is in the prestigious Woodrow Wilson School. Woodrow Wilson was a former president of Princeton who went on to become president of America. In Princeton, they regard that as a demotion.

On a scale of one to 10, if Princeton is a 10 at raising money, where are British universities? ‘Between one and two,’ he responds. Princeton now has sufficient resources to set its own priorities but, according to Katz, even it can’t resist the lure of new money. The market model, he complains, is distorting traditional academic agendas. ‘It’s happening everywhere in the Western world. Universities see opportunities to raise very large sums of money in order to do certain kinds of things: those kinds of things are intensely practical, mainly scientific subjects, or subjects related to economic development. The threat is that the traditional orientation of universities will be skewed against the full range of liberal subjects. The humanities, even the social sciences, will be left behind.’

The problem is not simply that business schools are proliferating and Classics departments shrinking. Governments, too, have their own priorities, favouring some areas of research over others. There is no flawless way to allocate resources. But government funding has greater accountability and transparency. In theory at least, the government determines spending according to what it regards as the nation’s best interests. Private donors have their own motivations: perhaps they’re driven by an idiosyncratic hobby, by status and naked self-promotion, or by political dogma.

Take one example. In the past decade, there have been substantial bequests from Gulf sources to various centres of Islamic and Middle East studies. In September, Durham University confirmed that it has accepted a £2.5 million endowment from a former Kuwaiti prime minister who resigned amid some controversy. Meanwhile the distinguished publisher Lord Weidenfeld, a ‘passionate Zionist’ by self-description, has spearheaded funding for a series of academic posts across Britain in modern Israel studies. Weidenfeld admits to an explicitly ideological agenda. A chair in Israel studies can be ‘a rallying point for information to fight against the strong concentrated anti-Israel campaigns on British universities’. He expects anybody who occupies a professorship in Israel studies to have ‘a balanced view’ of Israel, and a ‘positive attitude to the subject’. He’s trying, he says, to act as a counterweight to the influx of Arab money, which in his view has stoked anti-Israeli prejudice. This looks more like an academic arms race in the battle of ideas than the impartial pursuit of truth and objectivity.

On Twitter, a Murdoch Chair of Language was compared to the Robert Mugabe Professor of Electoral Politics and the Hugh Hefner Professor of Women’s Studies

In theory, benefactors are allowed to identify the areas in which their money is spent — on Islamic or Israeli studies, for instance. But they have no say in scholarly appointments and cannot interfere in particular research projects. In theory. Privately, academics mumble about donors expressing opinions and even trying to veto prospective candidates. By their nature, these stories are difficult to corroborate.

Every now and again, however, such allegations erupt into the open. Earlier this year, at York University in Toronto, the man behind the Blackberry device, Jim Balsillie, agreed, through his think tank CIGI (The Centre for International Governance Innovation) to give CA$30 million (c£18.8 million), to establish 20 graduate scholarships and 10 research chairs in international law. In a matching scheme, the government of Ontario was to pump in an additional CA$30 million, making CA$60 million in all. The Osgoode Hall Law School of York University, already one of Canada’s top schools, looked set to become a faculty of international standing.

That was until the staff began to examine the fine print. ‘The agreement gave an unprecedented role to the external donor, in the hiring, renewal and firing of faculty,’ said Stepan Wood, associate professor of law at Osgood Hall. To this day, CIGI denies it wanted any part in the actual appointment of staff, but the academic lawyers at the school remained unconvinced. After a series of heated faculty meetings, they voted to oppose the gift, effectively forcing the reluctant university authorities to turn it down. ‘I think it set a strong precedent and sent a clear message to benefactors and universities around Canada that there is a right way to go about [such] partnerships and a wrong way,’ said Wood.

It’s a principle that cost Osgoode Hall CA$60 million. Other Canadian universities were like hyenas bewildered that another predator had neglected a juicy carcass. Within a few days of York announcing that the deal had fallen through, several deans and presidents contacted CIGI with the same message: minus a few quibbles, the agreement had seemed acceptable to them. They would have no qualms about taking the money.

None of these issues come as a shock to Deborah Cameron, professor at the University of Oxford. Her room in Worcester College, overlooking some of Oxford’s most beautiful gardens, is in the Nuffield building. Lord Nuffield, an Oxford benefactor in the first half of the 20th century, was a bicycle repair man turned motor car tycoon. But Cameron is more directly linked to a tycoon of the late 20th and early 21st century. She holds the Murdoch Chair of Language and Communication.

She is surprisingly open about the dilemmas of her position. These do not include worrying about interference. Murdoch’s company, News International, has never tried to hamper or direct her research — Rupert Murdoch almost certainly hasn’t read a word of it. And Cameron, renowned for her feminist perspective on language, is no defender of Murdoch’s papers, particularly, the top-selling tabloid, The Sun. Like Princeton’s Stanley Katz, she has a broader concern. Big benefactors usually want to earmark their gift for specific purposes, and in Cameron’s term, that can mean ‘all fur and no knickers’. They might be tempted to fund a swanky new centre for cutting-edge neuroscience, but stumping up cash to meet the humdrum stuff — books, photocopiers, the salaries of existing staff — that’s far less enticing.

Naming a chair at Oxford after Rupert Murdoch was contentious from the start. But as the phone-hacking scandal escalated, and after criminal charges were brought against News International executives and a parliamentary committee concluded that Murdoch was unfit to run a global company, Cameron found herself implicated by association.

She came in for some stick from the non-Murdoch press. It mostly took the form of snide remarks. The columnist Matthew Norman wrote in The Independent that the post should be renamed the Chair of Obfuscatory Language and Intercepted Communications. On Twitter, a Murdoch Chair of Language was compared to the Robert Mugabe Professor of Electoral Politics and the Hugh Hefner Professor of Women’s Studies.

The occupant of the Murdoch Chair didn’t get the joke. She felt besieged, her reputation impugned. ‘I did have to worry,’ she told me, ‘because I thought people who are reading this might be considering coming to study with me, or inviting me to a conference or contributing to a book, and they may be thinking, well, we’re not actually interested in having somebody so controversial on our programme.’

Plus, she feels under an obligation to retain cordial links with News International. That’s an awkward relationship. It certainly isn’t one based on friendship. One of Jean-Jacques Rousseau’s psychological insights was that friendship was only possible between equals. The relationship between a giver and a receiver is one of asymmetrical power — and liable to be characterised by condescension on the one side and obsequiousness on the other.

But the reputational risk is principally to institutions not to individuals such as Cameron. The wake-up call for the UK higher education sector was 2011, and occurred as Libya descended into civil war. Attitudes to Libya had softened over a period of years, and one university, with the active encouragement of the British Government, had developed strong ties with the regime and its buffoonish tyrant Colonel Gaddafi. As the Libyan government brutally tried and failed to suppress the uprising, the London School of Economics was left looking at best naïve and at worst amoral and rapacious.

‘There’s always the possibility that some skeleton will come rattling out of the closet, and your acceptance of a donation will come back to bite you. There are thousands of accidents waiting to happen’

The world was reminded that Gaddafi’s son, Saif, had taken his PhD at the LSE. Shortly after the doctorate was conferred in 2008, his foundation gave the LSE a donation of £1.5 million. Allegations later surfaced that Saif had not been up to the requisite standard for a PhD, and that his thesis was not all his own work. The LSE commissioned an inquiry — led by a distinguished judge, Lord Woolf — and it was damning. In particular, Woolf wrote, the LSE had failed to embed any ethical code within its decision-making process. The story had several aftershocks, including the resignation of the LSE’s director, Sir Howard Davies.

Deborah Cameron believes that further scandals are inevitable. ‘There’s always the possibility that some skeleton will come rattling out of the closet, and your acceptance of a donation will come back to bite you. There are thousands of accidents waiting to happen.’ Back in September, the Financial Times ran a long story about the source of Durham University’s Kuwaiti endowment. Sheikh Nasser Mohammed al-Sabah, a member of the Kuwaiti royal family, had resigned from the Kuwaiti government in November 2011 after it was accused of corruption. But Durham is holding tight to the largesse: it says the allegations are unproven.

A few months ago, I overheard a snippet of conversation at the Birmingham International Convention Centre. It went as follows:

(Fundraiser) We’ve got a meeting booked with the vice chancellor next week. We’re hoping to do something really transformative for the university.

(Businessman) Oh really…

(Fundraiser) Yes. We’re looking at an investment of about £100,000 a year over five years…

Actually, ‘overheard’ is not quite the right term. The request for money wasn’t genuine. I was in a room packed with university fundraisers, who were being taught how to approach wealthy alumni. This was just one event at a mass gathering organised by CASE, the Council for Advancement and Support of Education. CASE is helping to import US fundraising techniques into Europe. There were more than 1,000 university officials in attendance from 34 countries and the conference had scores of sessions, on topics such as alumni relations, the ethics of fundraising, and how to tap into mega-bucks from the mega-rich in Asia. But essentially it all boiled down to an extended seminar in the dark arts of money-making, or rather, money-extraction.

While universities across the country scramble to ensure that they have the appropriate procedures in place to minimise the prospects of another LSE-style humiliation, the message at the CASE conference was mixed. ‘Yes, be wary.’ ‘Yes, do your due diligence.’ ‘But,’ several speakers stressed, ‘don’t be over-cautious’.

In even the most successful fundraising universities in Britain, the number of alumni who regularly give can be as low as two per cent. This pathetic figure is set to rise dramatically. As Princeton has discovered, part of the secret to fundraising is to coax as many alumni as possible to give, however small the amount. Giving, it turns out, is addictive. If graduates fresh out of college can be persuaded to part with £10 a year, perhaps one day they will come into serious money, and at that stage will be minded to donate an exponentially larger sum.

High net worth alumni are being identified by British universities, and are targeted for special courting. Talking to fundraisers makes you realise that they inhabit a parallel economic universe. A city worker earning anything less than £250,000 a year is scarcely worth their bother.

‘Rich is an interesting term,’ a doyenne of fundraising told me. The effortlessly charming Tania Jane Rowlinson is based at Bristol University. She said: ‘What is rich to me and you is very different from what is rich to somebody with a job in the city, and different again from a lawyer, a QC who is earning £1 million a year. But the QC is probably working for people who earn £5 million or £10 million pounds a year. So does that QC feel rich, earning £1 million a year? Not necessarily.’

Paying for fundraisers such as Rowlinson is a terrific investment. She has a proven record. She knows just the moment to make the ask. For every pound spent employing her, the university can expect five or six pounds in return.

To thrive, universities desperately need these gifts — under current financial constraints, they’re a necessity. But the balancing act is going to be a tricky one. To succeed, universities also need to maintain their autonomy. Stepan Wood of York University put it to me succinctly: ‘What gives the university its value to society is its independence. What allows it to be an engine of innovation, social change and progress is the ability to engage in critical thinking and research. And that’s possible only without constraints from outside forces.’

In the meantime, if you’re a UK graduate, you’ve probably already been contacted by your alma mater. If you haven’t, expect an approach sometime soon. Expect too, many more scandals about academic research being tainted by the power of money. The claim that universities exist principally to serve the greatest good of the greatest number will become increasingly implausible. If, instead of his glass box at University College London, Jeremy Bentham had a grave, it would no doubt be the site of some furious turning.

29 November 2012