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The Tufts Daily
Where you read it first | Tuesday, May 28, 2024

New committee to give advice to trustees on Tufts' endowment

Tufts students are working to form a committee that would give them input on how the university handles its $1.2 billion endowment. And they hope to have it assembled by the middle of next month.

Concerned about the failing grade that the university received last winter in transparency from the Sustainable Endowments Institute and unsettled by the chance that some university funds might be used to support abusive governments, the students have long wanted to know exactly where the endowment is invested.

To that end, members of the Tufts Coalition for Endowment Transparency and Democracy (TCETD) obtained approval last year from the Board of Trustees to form a committee to increase student knowledge about the endowment.

While the coalition became somewhat defunct after this, sophomore Gabe Frumkin and juniors Liz Gross and Nicole Zeller have continued to work on organizing the committee. Earlier this month, they brought their plans before the Tufts Community Union (TCU) Senate.

Tufts currently does not make any information about its holdings available to the public, a practice that, according to university officials, is common at other institutions and is designed to protect the university's investments and potential returns.

"The Board of Trustees has adopted a policy of confidentiality in order to maintain the integrity of the university's proprietary investment choices and strategies," Patricia Campbell, Tufts' executive vice president, said in an e-mail.

In many cases, the university puts money into commingled funds along with a number of other organizations, so Tufts officials do not control the investments and are contractually prohibited from disclosing certain statistics.

"Rather than risk violating [a non-disclosure agreement] or diminishing a source of attractive return by sharing a proprietary strategy with the marketplace, we do not disclose specific investments," Campbell said.

University President Lawrence Bacow said that while he appreciates the interest in the subject, students are beneficiaries rather than directors of the endowment.

"The responsibility that the university has is to the donors that have entrusted the funds to us," he said.

As such, he said that donors must be the ones to determine where the money is invested and that the trustees are the ones that need to speak for the donors.

"They're a great proxy for the donors because they are all major donors themselves," he said.

But students involved in the transparency effort said that their goal is not to decrease the profitability of the endowment.

"We want it to be prosperous, but to do so with a social conscience," Zeller said.

And Frumkin said the group would be fine with only examining, at least at first, investments of which the university has direct control. He said that the committee might eventually look into commingled funds, though.

The endowment transparency effort gained steam last year as a way of extending Tufts' general appreciation of active citizenship.

The soon-to-be-formed committee will be the result of this concern and is expected to include five students, three faculty or staff members, one alumnus and one administrator.

Frumkin, Gross and Zeller will be three of the students, and Neva Goodwin, the co-director of Tufts' Global Development and Environment Institute (GDAE), is on board as well.

According to Frumkin, student interest so far has been high, but "we've not been having as much success with faculty, alumni and the administration."

When formed, the group would like to have a say in the proxy voting that Tufts does on some of its investments. Information would therefore be made available to them by the Board of Trustees and they would be subject to a non-disclosure agreement.

Frumkin said this would go a long way in increasing students' knowledge about the university's holdings.

"Endowment democracy is more people having more say in how the endowment is managed in terms of socially-responsible ownership," he said.

As a result, according to students involved in its planning stages, the advisory committee will aim to ensure that the university makes socially-conscientious decisions about how it invests.

"At its very root, this whole idea functions off the idea that Tufts ... has some responsibilities as a civics-minded institution," Frumkin said.

In order to become members of the planned advisory committee, students will have to participate in an application process run by the TCU Senate, a stipulation created by the Board of Trustees.

According to TCU President Neil DiBiase, the Senate will be working with Campbell and the trustees to decide on a formal process.

"We're all anxious to get started on this," he said.

Sophomore Adam Kornetsky, a TCU Senate liaison to the Board of Trustees, shared DiBiase's excitement.

"I'd like to definitely see the committee [formulated] by the end of the semester," he said.

Kornetsky hopes that the committee will be able to keep the student body informed of its actions, possibly through reports to the Senate.

Apart from its role as social-activism force, the committee would also serve as a learning experience for those involved.

"The trustees believe this will be a valuable educational channel for students," Campbell said.

Frumkin said that the committee's educational factor should allay any concerns over it becoming overly-politicized, and that members of the committee should address all sides of any controversial issues that arise.

"We have to remember that Tufts is an educational institution," he said. "What we want to do with this committee is an immensely educational opportunity."

Ultimately, though, the committee would aim to guarantee that the university does not ignore what its supporters consider to be its social obligations.

"What do you want your endowment to say other than that you make money?" Gross asked. "To not have the endowment reflect [social issues] at all ... could be really hypocritical."

Rob Silverblatt contributed reporting to this article.