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Trusteeship Magazine

Awarding Exceptional Board Service

March/April
2016

The AGB John W. Nason Award for Board Service recognizes governing boards that have demonstrated exceptional leadership and initiative, unusual courage in the face of difficult circumstances, and significant achievement that benefits the institution, system, or foundation in ways that truly matter.

John W. Nason (1905–2001) was an exemplary leader and staunch advocate for good governance. A philosophy professor and president of Swarthmore College, Carleton College, and the Foreign Policy Association, he directed AGB’s Commission on the Future of College and University Trusteeship. He was an author, mentor, adviser, and speaker whose greatest accomplishment was chairing the National Japanese American Student Relocation Council, helping more than 4,000 interned students continue their college studies across the nation during World War II.

Six institutions were selected to receive the award. A summary of their winning entries follows.

Chatham University

The board of Chatham University, founded in 1869 as a women’s college, has faced a number of challenges since the 1990s—from selling campus real estate to keep the institution afloat, to acquiring industrial space and creating a LEED-certified academic building, to adding the new Eden Hall Campus—and it has met them all with exceptional leadership.

But the changes that Chatham’s board has led since 2013 are among the most transformational. In revising Chatham’s mission, reorganizing its structure, and implementing undergraduate coeducation, the board has helped shape the university in ways that have strengthened and advanced it and allowed Chatham to continue meeting the needs of the future.

The Great Recession of 2008 hit small, liberal-arts colleges hard, and Chatham was no exception. Its endowment fell from a high of $65.1 million in October 2007 to a low of $39.5 million in February 2009. One of the bold steps the board took was to suspend withdrawals from endowment to allow it to replenish. Chatham went 44 months without a withdrawal, a remarkable achievement that required the administration to exercise even greater control over expenses so as not to create significant operating deficits; the endowment eventually rebounded to $83.9 million (as of June 30, 2015).

Undergraduate enrollment peaked in 2008, then declined an average of 9 percent each year thereafter. By 2013, Chatham’s successful graduate programs (added in 1994) were subsidizing the undergraduate women’s college by over $5 million a year, a figure that was expected to grow to $7.7 million within five years. The decline in undergraduate enrollment impacted more than the bottom line; it threatened Chatham’s ability to continue delivering the high-quality education for which it is known.

Two issues became paramount: the need to position the university, particularly its undergraduate programs, to better meet the changing higher education landscape and students’ changing needs (e.g., cost effectiveness, more and better professional preparation); and the need to grow undergraduate enrollment to ensure the long-term sustainability of the entire institution.

In February 2013, the board commissioned a board study group to more closely assess the university with respect to three areas: (1) enrollment and financial trends and projections, (2) institutional effectiveness and student learning, and (3) challenges and opportunities. Ultimately, the board fundamentally reimagined how Chatham University delivers undergraduate education, implementing undergraduate coeducation and establishing a Women’s Institute to continue Chatham’s long-standing commitment to women’s education and leadership. But the two most important changes the board led were to revise the mission (through the Chatham Plan, with a heightened emphasis on professionalism and preparation for workforce, as well as a renewed commitment to sustainability and global and intercultural education) and reorganize its structure (by schools of related disciplines instead of student type).

Through its commitment to regularly assessing both the institution and the trends affecting higher education, Chatham’s board continues to make the changes necessary to advance the institution and help it meet the needs of its students and society.

Maricopa County Community College District

In April 2013, the Maricopa County Community College District (MCCCD)— a large, complex organization that governs multiple institutions in Phoenix, Arizona, and its surrounding communities—faced a frightening situation when it was notified by the FBI that a hacker had infiltrated its website, planted malware on it, and listed a number of databases for sale. This incident, in part a result of a failure of vigilance by the IT leadership team, potentially exposed the personal data of 2.5 million individuals to the risk of unauthorized access. The board took immediate action, requesting that IT services take the identified servers offline, stop all web development, and initiate an internal review of its entire system. To get the servers back online within a secure environment as quickly as possible, the board supported the hiring of expert counsel and independent technical consultants to investigate the data break, assigning expert counsel the role of legal representative.

From the very beginning of this crisis, the board actively sought to be fully informed, holding multiple executive sessions to receive the advice of counsel. The board and the chancellor also used this emergency as an opportunity to not merely restore IT, but improve it; this included a shift to a hosted environment, which greatly enhanced both data security and operational effectiveness. The increasing expenses related to IT security posed an ongoing challenge to the board throughout this process, which occurred during a time of state disinvestment: the Arizona state legislature voted to withhold all state aid to the Maricopa Community Colleges, forcing the board to make ever more difficult decisions about how to spend increasingly scarce resources.

A second challenge arose during this already-difficult time. MCCCD’s administration implemented recommendations from the independent investigators that some of the IT leadership team be terminated for their role in the data security problems. All but one eventually resigned. Following intense public scrutiny and due process, the publicly elected board voted to terminate the remaining employee.

Throughout this period, law firms pursued putative class actions against MCCCD, seeking a minimum of $6.5 billion, plus massive public records demands against the district. Mass media coverage of these actions added to the compounding pressures on board members. The board recently approved a settlement of these lawsuits on favorable terms, which has been presented to the court for approval.

The board of Maricopa County Community College District worked collaboratively under difficult circumstances that threatened its financial stability and core mission. Members of the board presented a unified front in supporting the chancellor and the management team as the organization struggled with significant change. During this critical period, the organization moved toward strong cybersecurity governance and practices while protecting impacted individuals with needed services.

Metropolitan State University of Denver

Metropolitan State University of Denver (MSU Denver) is a large, diverse, urban public university with over 20,000 undergraduate and graduate students located in the heart of downtown Denver. MSU Denver has both an access and affordability mission, with over 37 percent of its student body being traditionally underrepresented minorities and more than 31 percent being Pell-eligible. The average age of an MSU Denver student is 26 years old, and 60 percent are transfers, indicating a large number of nontraditional students. MSU Denver also is currently working to become a Hispanic Serving Institution (HSI), with more than 22 percent of the current student body being Hispanic/Latino.

Perhaps because struggle and challenge have been part of the DNA of MSU Denver since its founding, the board and university leadership have faced considerable opposition to a number of groundbreaking initiatives.

Nothing exemplifies the courageous leadership exhibited by the board more than the creation of a special tuition rate for undocumented students in the absence of state “Dream Act” legislation providing for in-state tuition for young people brought to this country illegally by their parents as children. As a college of opportunity, MSU Denver’s faculty and university leadership strongly supported allowing in-state tuition for undocumented students given the hundreds of such striving enrolled students who were paying non-resident tuition with no eligibility for financial aid.

In 2012, the Colorado State legislature had taken up legislation relating to undocumented students for nearly 10 years in a row without creating a pathway to an affordable higher education. When legislation failed again, the board determined that the university would create a special affordable tuition rate for current and future undocumented students who were in their present circumstances through no fault of their own. The board required the rate to be implemented by the fall 2012 semester, less than three months later, despite the initial financial losses incurred by converting current undocumented students to the special lower rate.

Both the serious political blow back and tremendous outpouring of support from the community were greater than could have been imagined: the university’s state financial support was threatened, the Colorado attorney general wrote a contrary legal opinion, the university was deluged with both hate mail and support, the media gave the situation unprecedented coverage, the university was threatened with legal action, and some called on the governor to dismiss board members. The board stood firm throughout this storm, becoming tireless advocates for the institution and the larger societal principles behind its action and standing with the president and university leadership who were also under tremendous fire. The special tuition rate was implemented, on time, and ultimately attracted double the number of students enrolled at its announcement.

Because of the board’s actions in 2012, MSU Denver currently enrolls half of all the undocumented students in the state, and is frequently consulted by other institutions in states where no dream act legislation exists and asked to share particulars of the policy at national conferences.

Mitchell Hamline School of Law

The past few years have been a time of extreme turbulence in higher education, and, in particular, in the realm of legal education. A 30 percent increase in the number of ABA-approved law schools since the 1970s, coupled with the economic collapse of 2008, have led to a dramatic drop in enrollment. In 2010, there were 147,525 students enrolled either part-time or full-time in U.S. law schools; by 2014, that number had dropped to 119,775. The radical decline in enrollment nationwide produced economic distress in many law schools and also increased price competition and tuition discounting as more institutions pursued fewer students.

Within this context, the board instituted a number of measures designed to strengthen its governance role. It introduced annual self-evaluation surveys, began a more intentional program of trustee selection aimed at diversifying the perspectives and expertise of trustees, and encouraged greater reliance on committee work and recommendations, thus allowing the board to appropriately focus its energies on strategic- level issues. But the combined effect of decreased enrollment and increased tuition discounting were taking their toll on the institution. Understanding that “you can’t cut your way out of a crisis,” the board instead determined to strengthen the mission and value proposition for students.

As a result, the institution undertook three courageous initiatives during this critical time. First, in 2010, the board authorized a $25 million comprehensive fundraising campaign. It adopted an aggressive timeframe (four years) and a clear focus: people and programs, rather than bricks and mortar. Board participation was 100 percent, directly raising 34 percent of the total. Second, the college developed and implemented a blended or hybrid option—partially online, partially onsite—for earning the JD. The program, which is unusual in law circles, was developed over three years, and not without resistance from the legal community and concern from within the institution. The board worked closely with the president and dean to ensure that the reputational and fiscal aspects of the program were on track. Ultimately, the program has strengthened the school’s mission through the harnessing of technology.

The third initiative was the most daunting: the combination of William Mitchell College of Law with Hamline University Law School. With both institutions experiencing significant pressures on revenues, combining would increase the student base and make available shared services but it also presented issues of identity and independence for both institutons.

The board confronted these challenges through an intentional and persistent effort to preserve and strengthen its governance and distinctive mission, which it did, through a carefully executed choreography of decision making and shared governance at its best.

Randolph College

The Randolph College board of trustees has been a board focused on its fiduciary responsibility, particularly over the last decade. At the turn of this century, the college, founded in 1891 as Randolph-Macon Woman’s College, increasingly faced difficult circumstances: declining enrollment, increasing discount rate, increasing deferred maintenance, and declining financial stability. In 2006, the board of trustees made the decision as part of a strategic planning effort to admit men for the first time in its history and change its name. This strategic plan, adopted in 2006 and revised in 2011 and 2015, has focused on fulfilling the mission of the college while ensuring its longevity by securing its financial future.

In 2006, the board of trustees voted to endorse a strategic plan that would allow the college to become coeducational the following year. What resulted was nothing short of a firestorm. The next six years were particularly rough. Despite a planning process that lasted more than two years, alumnae felt deceived and unheard. A number sued to prevent the college from becoming coeducational. News media attention and protests abounded. In the end, alumnae participation in giving dropped by two-thirds. Yet the dollars given to the annual fund remained flat thanks to the generosity of the trustees who were committed to seeing the college through its darkest hour.

The board forged ahead, picking a new name for the college and initiating a search for a new president to help oversee the transition. To complicate things, the Southern Association of Colleges and Schools placed the college on warning status at the end of 2006, citing financial concerns. The board worked with the interim and incoming presidents to reduce the discount rate, cut staff by 15 percent, and eliminate five academic programs.

In 2007, to strengthen the college’s financial position, the board reluctantly but unanimously decided to sell four paintings from its renowned American art collection and add the proceeds to the general endowment. Other challenges followed: the art market foundered, enrollment suffered, aging infrastructure necessitated the creation of a five-year deferred maintenance plan, and the board’s commitment to shared governance had to be reestablished.

In recent years, the board has renewed its efforts to become more consequential, realigning the work of its committees, refocusing its meetings, engaging in dialogue about the most critical issues facing the institution. The board is more engaged than ever and focused on strategically advancing the college. Last year, the board sent a delegation to the campuses of six other liberal-arts colleges to visit and learn. They spent time with senior administrators at the campuses (two direct competitors, two aspirational institutions in the South, and two institutions in the Midwest that had faced similar challenges to those at Randolph) learning about their values, governance, and operations.

The past decade has been an eventful one for the board at Randolph College, but it has lived up to its fiduciary responsibility, even when that meant making difficult decisions. The result is a stronger college, one that is poised to make significant gains in the coming years.

University of North Georgia Foundation

In 2011, several new initiatives designed to strengthen the University System of Georgia’s (USG) ability to serve students and meet state needs were announced. One was to review the potential for the consolidation of institutions within the system. At the January 2012 meeting of the board of regents, four consolidations among eight institutions were approved.

Two of those institutions were North Georgia College and State University (NGCSU) and Gainesville State College (GSC). These two very different schools, with different missions and cultures, are located within 30 miles of each other, but are worlds apart. NGCSU was founded in 1873 and is the second-oldest public institution of higher learning in Georgia; Gainesville State College was founded in 1966. NGCSU is one of six senior military colleges in the United States and is designated as The Senior Military College of Georgia. A comprehensive university with baccalaureate and graduate degree programs, it is also a residential campus with high academic admission standards. GSC was created as a junior college commuter campus with an access mission that had established a few baccalaureate programs. NGCSU had a loyal alumni base; GSC had loyal community support.

In January 2013, the University of North Georgia was created out of the former NGCSU and GSC. The fast-paced consolidation left a residue of distrust that strained both institutions and their foundations. Both institutions lost their beloved mascots, the Saints and the Fighting Geese, becoming the Nighthawks. Donors on both campuses were threatening to discontinue their support. The two foundation boards worked independently to decide if they even wanted to make the effort to consolidate and, if so, how?

Each foundation eventually appointed members to a consolidation steering committee. At their first meeting, the group was asked to consider making the commitment never to vote on any issue, be it bylaws, fundraising, or frequency of meetings. While this unusual concept was skeptically accepted, it ensured that every decision would be made by consensus once all members agreed. It was a trying process, but good judgment, common sense, and the willingness to set aside personal agendas and egos prevailed. The two foundations voted unanimously to consolidate, and on July 1, 2014, the University of North Georgia Foundation, Inc., was established.

Since 2011, 12 USG schools have either completed consolidation or are in the final stages of doing so. Only one consolidated foundation has emerged. The leadership, determination, and service of the members of the Gainesville State College Foundation and the North Georgia College and State University Foundation cannot be underestimated. They put aside differences and worked toward a common good, an example of sacrifice above ego and of what makes the University of North Georgia special as a designated leadership institution in the state of Georgia: service above self.

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