Exactly how the University receives and manages its endowment has remained largely out of view, prompting frustrated students to band together to form a new group called Washington University Students for Endowment Transparency (WUSET).  The group is collaborating with Student Union to bring the issue of responsible and honest endowment investing to the forefront.

In 2007, the University formed a separate investment company called the Washington University Investment Management Company that manages all the endowment investments and reports to the board of trustees. Chief Investment Officer Kim Walker is the head of the company.

WUSET’s mission is to hold the University accountable for its investments and make sure that the investments uphold the values of the student body. Members of the group say the first step in doing this is to have the University disclose its endowment activities to the public.

“Whether [the University] is investing in an organic farm or, say, Boeing, investment decisions carry the weight of intrinsically supporting their business practices, and it’s important to know whether those practices are ethical or not,” said Molly Gott, sophomore and WUSET member.

A source of concern for WUSET is that many members of the board of trustees, which establishes policies for and oversees endowment investments, are also high-ranking officials of large corporations such as Boeing, Bank of America, Monsanto, Arch Coal, Ameren and Peabody Coal.  Without endowment transparency, students have no way of knowing the extent to which the University is invested in the companies of the board members and any conflicts of interest that are present.

Additionally, WUSET hopes that endowment transparency will encourage the University to invest in companies that are committed to creating positive influences on society, such as renewable energy firms.

WUSET’s efforts have included several students attending a recent conference sponsored by the Responsible Endowments Coalition (REC) at the University of Pennsylvania to learn more about endowment transparency and socially responsible investing.  The group plans to meet with Chief Investment Officer Kim Walker and work with the University administration to reach its goals.

Ideally, WUSET would like to realize a future where students, faculty and alumni can access financial records of the University’s endowment investments online.  Some universities such as Columbia and Brown have already achieved such transparency through their Web sites.

A relatively young group, WUSET’s members hope to create a committee composed of students, faculty and school officials who would have institutionalized power and the ability to vote on matters pertaining to endowment investment. The committee would be responsible for investigating the various investments and making sure that they reflect the principles of the wider University community.

Members have attended an SU-sponsored town hall meeting with Chancellor Wrighton in which endowment investing was addressed.

“As a group of concerned students, we look forward to working with the administration in order to improve the global impact of our considerable investments, giving the University community yet another reason to be proud of our University,” Gott said.

Chancellor Mark Wrighton speaks on the issues and challenges currently facing Washington University and those the school will face in the short-term future. The University’s endowment is estimated to have fallen 25 percent since the end of fiscal 2008 and is expected to continue declining. (Matt Mitgang | Student Life)

In the midst of the worldwide economic crisis, Washington University is dealing with a difficult financial situation of its own.

The administration estimates the University’s endowment is down by 20 to 25 percent as of the end of May, according to Chancellor Mark Wrighton.

“That [estimate] might be a little better than we had in mid-April, when I communicated it to the community,” Wrighton said in reference to an e-mail he sent to students, faculty and staff to inform them about the University’s financial situation.

He followed up that e-mail with a “State of the University Address” on April 23, providing the community an opportunity to ask questions.

Wrighton said donations to the University have held relatively steady, even as the number of donors to the University has decreased.

“[It] might even be ahead [of] last year,” Wrighton said.

In fact, the total amount of money donated to the University in fiscal 2009 as of the end of May was 4 percent higher than the previous year, according to David Blasingame, executive vice chancellor for alumni and development programs.

Blasingame said the University is also outperforming peer institutions in donations.

“I think most places are experiencing downturns,” he said.

Blasingame attributed the University’s slight upturn to several large donations at the beginning of the year. The University, he said, also has benefited from an institution-wide strategic planning, which provides potential donors a glimpse into new ideas and plans underway at the University.

As one of the foremost responses to the economic crisis this past year, Wrighton said the University is re-prioritizing resources to increase financial aid. Bill Witbrodt, director of Student Financial Services, said the financial aid budget “has top priority.”

“We recognize that when the economy is rough, our families are having a tough time too. We need to do all that we can to make sure that our students can continue their education at Washington University,” Witbrodt said. “When things are tough, it’s even more important to have a stable financial aid budget.”

The student financial aid budget has increased by 20 percent in the past two years—a feat accomplished partially by cutting administrative expenses. Meanwhile, tuition has risen—though by less than 10 percent, Wrighton said.

This is the first time that University has had to freeze compensation expenses since Wrighton’s tenure as chancellor began in 1995, he said. The University has also filled advertised jobs slower and recruited fewer faculty this year than usual.

Wrighton predicts the next fiscal year, beginning July 1, 2010, will be even more challenging. In fact, the University—in efforts to brace itself for greater financial troubles ahead—has started preparing for next year much earlier than it has in the past.

Even with the chancellor’s recent disclosures about the University’s economic state, most students remain dissatisfied with the administration’s extent of communication and transparency in financial issues.

This past semester, several students came together to start a Facebook group called “WU Students for Endowment Transparency” (WUSET). Junior Jacob Stern, one of WUSET’s founders, said he and others formed the group after reaching a consensus that students have very limited access to the University’s financial information, such as the breakdown of the endowment.

“By adopting a method of controlled disclosure, the University would join the ranks of prestigious educational institutions, such as Brown, Harvard, Yale, Duke, Stanford, and Columbia that have empowered students by making investment records available but would not limit the power of trustees or administrators,” the group’s mission statement reads. “We feel this step would reflect an institutional commitment to student participation in the broader university community.”

WUSET is in the stages of preparing for more active efforts in the fall, including talks with the administration.

“We really hope that it can be a really cooperative relationship,” said Stern, who hopes that the partnership will be beneficial for both students and administrators alike. “We don’t see the administration as an enemy by any means.”

Washington University, in fact, is executing a campus construction plan that is deeper than simply remodeling buildings. The so-called Plan for Excellence includes improving the University’s appearance and how it realizes its educational mission. A remnant of the 1995-initiated Project 21, the Plan for Excellence is a framework for building a more successful university over the next decade. The plan is expounded at http://theplan.artsci.wustl.edu.

The problem with the Plan for Excellence is that the above Web site is the only place where it is publicly expounded. Select groups of students such as residential advisors and administrative groups have heard the presentation on the plan and were able to glean a greater understanding of the construction and major changes the University has been making in recent years. However, current students have not been the beneficiaries of any major effort to disseminate information about, or to even mention, this plan.

Students at Washington University need to understand why the major inconveniences they experience each day due to construction and major University transitions are occuring.

Groups that have heard Dean McLeod’s presentation on the Plan for Excellence have emerged from the experience with a mind sympathic toward the University’s goals rather than antagonistic toward them. The University and its students both would benefit from a well-publicized, well-organized presentation in Graham Chapel, to which all students were invited, expounding the Plan for Excellence.

Students are eager to understand why the changes they experience each day are occurring and what changes will occur in the future, but only with the University’s aggressive promotion and publication of information about its Plan will this much-needed chain of communication gain its first link.

Students, particularly underclassmen, have been especially marginalized by the lack of concern for their knowledge about construction projects on the South 40. A “Construction News” link on the Residential Life Web site, to which concerned students were directed by Residential Life e-mails, presents three links: a construction map of the 40, Umrath demolition pictures and “Construction News.” The “Construction News” link contains the following comment, and only the following comment regarding the South 40: “Construction of the new Umrath House and the new Wohl Center Phase 1 will be ongoing throughout the school year. Construction should be mostly contained within the construction fence. Please use caution when walking near the construction site; there may be construction-related traffic in the area.”

We hardly need to say that this information is an insult to the students who will be spending their entire academic year in a residential area ravaged by construction. What is Wohl Center Phase 1? What will the new Umrath House look like? Will there be any new paths paved, so that our walks to class don’t take so long? I heard there will be a path between Beaumont and Ruby, but I can’t be sure. When will construction start and end each day? Construction will be mostly contained within the fence? Mostly?

Residential Life’s emphasis on creating a community for students, rather than just a place to sleep, is in direct opposition to the “try not to hurt yourself” attitude that the “Construction News” page presents. Though it may plead “lack of direct connection” with the construction company, ResLife is still responsible when water is cut off in Ruby, Lee and Beaumont just as freshmen arrive on campus, when construction fences are haphazardly left hanging open during weekends and when Brookings and Wayman Crow residential colleges are a 10-minute walk away from each night’s dinner.

Though the University administration and Residential Life can do very little to eliminate the inconveniences that major structural changes in the University cause, they can help students understand these changes. To this point, the effort to inform has been next to nonexistent. It is time, right now, for the University to help its students understand its present and its future.

Though the University does have set amounts of money it would like to allocate to the different goals listed in its plan, it has refused to make this information public, which makes it difficult to know how seriously the University will pursue each of its listed goals. For example, one of the goals of the plan is to “allow students to graduate debt-free.” This alone would radically change the composition of the University’s student body, making its education open to a larger variety of students with different economic backgrounds. The increased diversity would enrich the education of Wash. U. students and if several universities took steps like this, the American dream of equal opportunity would start to become more of a reality. The possibility of debt-free graduation is only one of several lofty goals embedded in the plan. Looking at the plan’s goals, it’s easy to start dreaming of a significantly improved University that truly fulfills the ideals of higher-education. However, it’s questionable what the priorities of this plan really are and how the different goals will be fulfilled, given the administration’s silence and secrecy about the specific details of the plan.

The University refuses to release budgeting numbers, which are the only way to discern which parts of the plan are real priorities. For example, the University could be mainly focused on renovating the Athletic Complex and thus only make a few changes to financial aid and still claim it has executed the plan. Since we don’t know what type of money Wash. U. plans to put toward increasing aid, it’s difficult to know if Wash. U. will actually be significantly increasing the amount of money it offers students in aid. Even without making the changes necessary for students to graduate debt-free, the University could claim it allowed a student to graduate debt-free if she worked many hours a week at work study and her family also had to take out loans to be able to meet the family’s expected contribution. This is all possible because we don’t know how the University will calculate need under the plan. And though it’s too much to ask the University how they plan to calculate need for a plan that hasn’t fully been developed, it is not too much to request that the University disclose the amount of money it actually plans to contribute toward the goal of debt-free graduation.

The Strategic Plan for Excellence has the potential to really transform the University by altering the composition of its student body and offering students the ability to engage in different types of experiences. For example, the plan seeks to increase stipends for unpaid internships and volunteer opportunities over the summer. Furthermore, it has the possibility of playing a progressive role in our country’s offering of higher education. Because the plan has the potential to do so much good, it’s important that the University truly achieve its listed goals. And if it is going to claim to do something as incredible as allowing its students to graduate without debt, then it needs to show them how it is working toward that goal. Additionally, if the University really has a set plan to achieve these goals, why keep the specifics of the plan secret from the student body? This plan is the type of program the students would readily support. Students could play a role in helping to fundraise and bring this plan about if they really understand the plan’s vision and how the University plans to execute it.

The Strategic Plan for Excellence could offer students a radically different university experience, but the plan could also simply be a façade for raising money to build a new Athletic Complex. The University has an obligation to be transparent about the details of the plan’s funding and execution since the University has stated it will work toward such lofty goals.