Listen to this article
Last October, the Wisconsin School of Business was given an unusual naming gift. As well as supporting the school and its programmes, the donation of $85m was to guarantee that the name of the school would be unchanged for at least 20 years. The gift, donated by a small group of alumni calling themselves the “Wisconsin Naming Partnership”, is one of a series of large donations that, in the past couple of years, have been finding their way to US business schools.
Others include gifts to west coast schools, such as this January’s $30m donation to California State University’s business college – the fourth largest seen in the university’s history – and last October’s $25m gift to the University of California, Berkeley’s Haas School of Business – the largest individual donation to the school.
In May last year, the University of Chicago Graduate School of Business also received one of the largest cash donations in its history in the form of a naming gift from Charles Harper, former Con-Agra Foods chairman and chief executive, after whom the school’s new 415,000 sq ft building is now named. At Johns Hopkins University, a $50m gift in December 2006 has paved the way for the opening of the Carey Business School.
Part of the reason behind the increased number of such gifts is the accumulation of wealth that has taken place in the US, combined with a growing interest in philanthropy, with prominent business individuals such as Bill Gates and Warren Buffett leading the way.
“There’s just a lot of money out there,” says Carol Adelman, director of Hudson Institute’s Center for Global Prosperity, which produces an annual Index of Global Philanthropy. “We’ve got the largest inter-generational wealth transfer in history.”
Yet, athough wealthy donors can choose from a vast range of causes, management education remains a priority. Part of the reason is that most wealthy donors acquired their money through commerce and consequently often want to be able to help give others the same kind of education.
Business schools also find it easy to be businesslike about large donations. “There’s much less resistance within university systems to having business schools named than with other schools,” says Carolyn Woo, dean of the Mendoza College of Business at the University of Notre Dame. “You seldom see colleges of art and sciences being named.”
Moreover, the new wave of wealthy donors is far more hands- on and impact-conscious than previous generations. Business school alumni tend to believe in the power of commerce not only to generate wealth for individuals such as themselves, but also to foster economic growth and improve lifestyles worldwide. As a result, helping fund business education is seen as having a broad impact.
“People see the value that business plays in society and want to contribute,” says Angel Cabrera, dean of the Thunderbird School of Global Management, which, as part of a $65m capital campaign, recently announced two gifts of $5m and $10m. “People who are successful in business trust the ability of business to create progress in society.”
Scott Walker, the 1981 alumnus of Thunderbird who is giving the school the $10m – to fund the operations and expansion of the school’s entrepreneurship centre – expresses sentiments often seen among givers.
“There are a lot of reasons why I wanted to donate,” says Mr Walker, who is the founder and president of BillMatrix, a Dallas-based payment services company. “The school changed my life. It set me on the path that I am on now.”
However, passion alone does not guarantee a donation. Behind many of the big business school gifts lie many years of relationship-building. Schools must research the interests of potential donors and alumni and find ways to engage them in campus activities.
“Then you have to be patient and understand that this is a significant gift, and that it’s unlikely to occur just because you want it now,” says Stephen Bosworth, dean of the Fletcher School at Tufts University. “Frequently these are slow-sparking seeds. They don’t sprout and take root and produce flowers overnight.”
Once a gift is offered, schools have to make a careful assessment of the conditions attached to the donation. Prof Bosworth stresses the need to be clear with donors as to the school’s objectives, and what the institution is and is not prepared to do with the funds.
In some instances, this may even mean turning down the offer. Dr Cabrera cites an example of a gift that Thunderbird eventually declined. “The motivations of the donor were honest, clean and meant well, but the gift came with so many conditions in terms of how it had to be used,” he says. “Not every gift is a good gift.”