The role of chief financial officers at colleges and universities will grow increasingly complex in the next 10 years as institutions face more government scrutiny, form more business partnerships, and build satellite campuses in the United States and abroad, according to a panel of veteran college administrators.
Those three trends reflect the contrasting movements toward demands for more accountability in higher education but less money from the public coffers.
“You’re more likely to see more mergers, you’re more likely to see more colleges not making it, and you’re more likely to see more crises,” said one panel member, Joel Seligman, who is president of the University of Rochester.
In that environment, chief financial officers will need to shift much of their focus from oversight to strategic planning, another speaker said. “They’re going to have to be more like a financial broker,” hunting down new opportunities for their colleges, said Rufus Glasper, chancellor of the Maricopa County Community College District, in Arizona.
To be successful in their roles, chief financial officers will need to build trust and respect, think critically, and provide presidents with a healthy dose of reality, the panelists said.
Business officers, in turn, are looking for college presidents who will work as partners and aren’t afraid to grapple with cold, hard figures. “Having presidents who are willing to understand the numbers really raises the quality of the job,” said S. Catherine Longley, treasurer and senior vice president for finance and administration at Bowdoin College.
Presidents also must set the tone for financial integrity at their institutions, said Dean W. Currie, vice president for business and finance at the California Institute of Technology. “They’re not just the CEO,” he said. “They’re the moral leadership.”
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Colleges can take simple steps to cultivate stronger, longer-lasting relationships with foundations, according to a panel of three foundation leaders who discussed how their organizations decide which institutions to support.
The officials, who represented foundations of different sizes, said that they typically provide more support to colleges that demonstrate how they can collaborate with other institutions, that align themselves with the priorities of the foundation, and that are honest about assessing the success or failure of their programs.
“Don’t disappear after a grant is secured–we want to know how it’s going,” said Sonya E. Medina, director of the AT&T Foundation, who suggested that sending thank-you notes or news clippings can help. “All of that goes into a file, so when a new request comes in, we can see that we have a relationship established with you.”
W. Robert Conner, president of the Teagle Foundation, said that small foundations want their money to go toward programs that can affect multiple organizations.
“As a small foundation, we can’t make an impact by the amount we spend, but by the knowledge we accumulate,” he said. “We ask what can be learned from a program that is transferable to others.”
Anita M. Pampusch, president of the Bush Foundation, emphasized that building a relationship with a foundation is much different from doing so with an individual donor. When dealing with foundations, she said, colleges should have clear agendas and particular proposals in mind, and should treat foundation leaders “straightforwardly.”
“Foundations have set priorities and guidelines,” Ms. Pampusch said, “so you don’t need to establish close personal bonds in the same way you would with a donor.”
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If presidents are evaluated on a regular basis, should college and university trustees also undergo regular performance reviews?
Yes, said the president of the Association of Governing Boards of Universities and Colleges, Richard D. Legon, at a session on improving relations between trustees and presidents.
An emphatic no, said Jose A. Cabranes, a trustee of Columbia University and a judge on the bench of the U.S. Court of Appeals for the Second Circuit.
“It has a Chinese Communist aspect to it,” said Judge Cabranes. At institutions where people question the effectiveness of the board, you often will find a board that is “totally inactive,” he said. The answer is, “you need a board that meets often enough to know what is going on.”
Mr. Legon suggested that the effectiveness of trustees is rarely reviewed, and said that when there are reviews, “I see a real lack in their robustness and their regularity.” Mr. Legon’s organization is the largest membership group for college and university trustees.
Part of the problem with ineffective boards might be their size, said Judge Cabranes.
“The larger a board is, the more likely it is to be dysfunctional,” he said. Beyond 20 or so members, it is almost essential that there be a core group of trustees making many of the day-to-day decisions–”a de facto board,” as Judge Cabranes put it.
The session also focused on the number of no-confidence votes in presidents that faculty members have organized recently on numerous campuses.
“No-confidence votes have become a way to block reform,” said Phyllis Palmiero, director of the Institute for Effective Governance, another organization of college trustees.
Judge Cabranes said such votes have become ways of terrorizing presidents and “intimidating trustees who might be supporting the president.”
Sometimes the votes can open a fissure between a president and the trustees. For example, he said, Lawrence H. Summers would probably still be president of Harvard “if he had the genuine support of the Harvard Corporation,” that university’s governing board. The Faculty of Arts and Sciences approved a no-confidence vote in Mr. Summers in March 2005, but the trustees stood behind him. Then, in July 2005, one member of the corporation resigned, saying he could no longer support Mr. Summers. Mr. Summers resigned in February 2006 (The Chronicle, March 3, 2006).
The way to avoid such situations, said Mr. Legon, is for a president to confide in the board, and to keep the board informed and “energized in such a way that the president’s vision becomes the board’s vision.”