With Johns Hopkins and 18 other U.S. universities each seeking to add $1 billion or more to their endowments, I would like to offer a note of caution to Washington-area alumni: As former President Reagan said of his dealings with thethen-SovietUnion, “Trust, but verify.”
Not that Johns Hopkins or any other Washington-area school would engage in the questionable practices that are threatening to tarnish the reputation of my own alma mater. But university finances are big business. And the pressures to produce a good financial report can be as intense in a university trustees’ meeting as they are in a corporate boardroom.
My sisters and I have learned the hard way that anybody contemplating a major gift to a college or university needs to exercise great care. It’s important to know what you’re supporting; get it in writing; seek professional assistance from an attorney specializing in such matters; and monitor the use of your money as carefully as you would your personal finances. The same rules should apply to all charitable donations.
In 2002, the last year for which figures are available, charitable giving in America reached an all-time high in non-inflation-adjusted dollars — nearly $241 billion, according to the Center on Philanthropy at Indiana University.
Donations to U.S. colleges and universities declined, however. The estimated 1.2 percent drop, from $24.2 billion in fiscal 2001 to $23.9 billion in fiscal 2002, was the first decline in higher-education giving in more than 15 years.
What should be of greater concern to fund-raisers and college administrators than a modest dip in contributions is a recent survey commissioned by Charles Schwab & Company. The survey found that just 10 percent of affluent Americans age 45 and older plan to leave all or part of their estates to universities and other nonprofits. More than five times that number — 56 percent — plan to leave nothing to charity. This often occurs, the Association of Fundraising Professionals said, because “they don’t trust that the money would be well spent.”
My sisters and I understand such concerns.
In 1961, our parents donated $35 million worth of A&P supermarket stock to establish a new foundation at Princeton University, my father’s alma mater. The foundation’s sole mission was to support graduate studies at Princeton’s Woodrow Wilson School of Public and International Affairs in a focused effort to prepare top students for federal government careers in international relations and foreign affairs. Since the initial gift, the Robertson Foundation has dispersed some $250 million to Princeton to support the program.
But the goal of the program has been largely ignored. In addition, Princeton administrators have diverted millions of dollars from the Robertson Foundation into projects and activities that have little or nothing to do with my parents’ intent or the foundation’s mission. Our repeated inquiries and objections failed to resolve the situation. So, as a last resort, we are suing the university.
The Robertson Foundation was established for the express purpose of preparing Woodrow Wilson graduate students for careers at the State Department and other government agencies involved in international affairs. Princeton understood this whenitagreedtothe arrangement. But it has failed to fulfill — or even seriously pursue — this mission. Last year, for example, the school placed only three of 63 graduates in government jobs related to foreign affairs.
When people donate money to a nonprofit organization for a specific purpose, and the money is accepted for that purpose, that’s how it should be used. It makes no difference whether the gift is $100, $100,000, or in the millions.
The American Association of Fund Raising Counsel, the Association of Fundraising Professionals, the Council for the Advancement and Support of Education and dozens of individual colleges and universities have endorsed a code of ethics known as the Donor Bill of Rights. It states that when we give money to nonprofits, we have a right to be assured that our gifts “will be used for the purposes for which they were given.”
Remember that the next time you’re asked to give. If the organization soliciting your money has publicly endorsed the Donor Bill of Rights — as many have — you’re probably okay. If it hasn’t, remember President Reagan’s warning: Trust, but verify.
William Robertson and his sisters, Katherine Ernst and Anne Meier, are suing Princeton University to end Princeton’s control of the Robertson Foundation and its endowment.
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