We also talked about the dizzying climb of tuition at Penn State, and what “managing cost” really means.  With voting closing tomorrow morning at 9 am, I suspect most Penn ...]]> I had a great discussion last week with the guys from Radio Free Penn State (The Lion 90.7 FM — you can hear the interview at www.radiofreepennstate.org).  We covered the challenges of governance in a University, discussed the important differences between governance and management, and talked about what one Board member could do to drive change.

We also talked about the dizzying climb of tuition at Penn State, and what “managing cost” really means.  With voting closing tomorrow morning at 9 am, I suspect most Penn Staters have made up their mind and cast their ballot.  So my last post is really not about chasing a few more votes.  It’s about what I hope every single one of our Trustees will consider as they execute their responsibilities.

Penn State was, is, and always will be, at its heart, an educational institution.  Every program we have – from Agricultural Extension to the Football program, to the new Hockey program, the Hershey Medical Center, THON, student government, and every academic course and offering – is about teaching.  This is not “teaching” in the simple sense of distributing information.  We wouldn’t need a world-class University to do that.  No, it’s about teaching young people how to prepare themselves for life beyond Penn State.  It’s about teaching those young people not just the content of their learning, but how they learn, because they’ll need to do it every day of their lives.  At Penn State, we teach that life is more than what happens inside the classroom . . . it’s about the experiences we build, the service we do for others, the positive impact we can have on our community, and the relationships with which we surround ourselves.  It’s about the obligation we share as Penn Staters to make things better.

I’ve had the privilege through this process of talking to many Penn Staters over the last few months.  Without fail, each one says something along the lines of, “Penn State made me who I am,” or “I had the time of my life at Penn State.”  Penn State made its contribution to each of us in different ways, but we all had one thing in common:  we could access that experience.  Whether we had to borrow, work, or defer the price, whether we relied on scholarships, an athletic program or a wealthy benefactor for help — we all could access that experience.  We owe it to the next generation to ensure they can do the same thing.  Costs are rising – salaries, health benefits, energy — and as a result, tuition will continue to rise.  But we must slow the pace, and ensure that when our students emerge with their degree and their debt, that the value of the Penn State education delivers the promised return.  That’s a long-term view, and requires sensible investments in plant, property and programs while ensuring that we attract world-class faculty and sustain our reputation for ground-breaking research.

We’ve talked about a lot of important issues facing Penn State, and we have challenges that will continue to require our attention, our compassion and our integrity over the coming months.  As we navigate through these challenges, we also need to retain that sense of pride we all have in what we know Penn State is really all about — the things that make us say, “it changed our lives,” or “made us who we are.”  The things that inspire us to stop at the intersection and waive the canners over to offer a donation. . . only to drive a mile down the road and do it again.  The things that bring us back and make us ask everyone who tells us their son or daughter is considering colleges if they have visited Penn State.  It is a unique place, full of not just remarkable facilities but remarkable people.  With a focus on our future, and a commitment to sustaining accessibility of a Penn State education, this election can mark the beginning of the next great chapter in Penn State’s history.

For the Glory!

So, if structural change is unlikely what about the practices, policies and procedures of our Board?

The good news?  In my view. we ...]]> So in my last post, we discussed at some length the governance structure of the Board and what steps, if any, might be taken to modify that structure.  But I emphasized a key point that I think bears repeating:  all paths for governance reform lead through Harrisburg.  And I believe it is very unlikely that Harrisburg will do anything that would diminish its voice or reduce the political value of its involvement with Penn State.

So, if structural change is unlikely what about the practices, policies and procedures of our Board?

The good news?  In my view. we do have the authority to make the changes necessary to ensure that we never again find ourselves in circumstances like those under which we’ve labored this last year.  No legislative act is required.

Governance:  Delegation and Authority

Governance is not just about structure.  It’s not just about the Board.  It is about the delegation of authority and the tone with which leadership sets that authority.  Strong governance enables an organization, it does not constrain it.  Good governance creates clarity for organizations, to help them make better decisions and better pursue their Mission.

Setting authority means setting the tone and driving true accountability and transparency (words we’ve thrown around a lot in the last few months).  In my experience, the most important thing a Board can do is set the tone . . . demonstrating by example what is acceptable behavior, what the organizational values are, and clarifying for every member of the organization what is expected in their behaviors.  This means rewarding the right behaviors, and rooting out the wrong ones — tirelessly, relentlessly . . . every day.  No one gets a pass.  Everyone signs on to the same values built on shared expectations.

“That should be considered long which can be decided but once.”   - Publilius Syrus

Tone setting is only one step.  Making sure everyone in the Board Room feels not only the weight of their responsibility, but the enabling power of it as well — the ability to speak up, to disagree, to challenge a proposal, to ask for more data, to slow things down when more careful judgements are in order.  That is a function of leadership, but it’s also a function of the way the Board executes its business — the Standing Orders, bylaws, and day-to-day practices that make the Board operate.  In these areas, there are some clear and compelling changes to be made.

(1) Start by strengthening our conflict of interest policy.  The limits are too high on disclosures.  Any financial interest, regardless of its materiality or size, should be disclosed so that other Board members can make a judgement as to whether that disclosure warrants a conflict.  There’s no reason Penn State should not have one of the strongest, most clear and most compelling conflict of interest policies in the country.

(2) Next, strengthen the attendance policy.  At the moment the Standing Order says only that if a Trustee can’t attend four of the six meetings each year, they’ll have a discussion with the President of the Board about their ability to continue.  I’ve never seen anything quite like it.  If someone can’t attend at least four of the six meetings, they should be considered to have resigned their seat. I suspect this is a nod to our “ex officio” members from Pennsylvania, but you already know how I feel about those seats.  If you are going to have a voice in this institution, the first thing you’re going to have to do is show up.

(3) Reduce the privileges of the Emeritus Trustees.  I have enormous respect for those that have served the University with distinction.  But my recommendation is about the function of Boards, not about those that currently hold the title of Emeritus.  There appears to be a very high degree of involvement outlined in the Standing Orders for the Emeritus Trustees.  They’re included in the selection group on Board membership, for example.  Emeritus Trustee should generally be a position of honor.  They should be invited to attend one meeting (perhaps two) per year so that we continue to benefit from their experience.  But their deep inclusion in the regular function and discussions of the Board, despite their lack of a vote or the ability to make a motion, blurs the lines and undermines the clarity of authority necessary for a Board to function effectively.  They have influence, but no true accountability nor responsibility.  (Not to mention one other practical consideration — they make a big group bigger.)

(4) Establish a strong Internal Audit & Control function at the University, with the leader of this function reporting administratively to the Vice Provost or a similarly senior member of the Executive team, but functionally to the Chair of the Audit Subcommittee of the Audit, Risk, Legal & Compliance Committee that the Board established in the March 2012 meeting.  A similar process should be considered for the University’s General Counsel to brief members of the Committee on potential legal matters (not just active, filed cases, but all non-routine matters that could result in significant reputational or financial exposure or the University.)  Routine matters should be tracked and reported in summary and at least once a year the entire Board should be taken through a detailed assessment of the University’s legal exposure.  A similar process should be adopted for the review of items raised through “whistleblower” hotline calls and/or emails.

(6) Clear the room periodically.  The discussion around Open Records Laws and the Sunshine Act complicate life in a non-profit Board like Penn State’s.  But subject to compliance with the law, a best practice among Boards is to conduct executive sessions periodically with individual members of Senior Management, Internal Auditors, and External Auditors during which other staff, press, and attendees (such as Emeritus Trustees) are not present.  The idea is to facilitate an open, candid exchange of issues and ideas without the external pressures often present in the Board room.  This may not be a viable option at Penn State given our structure, but the conceptual intent should be pursued.

(7) Lighten the load and focus the firepower.  Consider other functions that should be delegated to Senior Management in order to provide more time in meetings to deal with the strategic and reputational issues the University faces.  With the right policies in place, agenda items such as naming of buildings, establishment of endowment and scholarship funds, and other actions can be taken in “consent form” which will free up important time in the meeting to focus on more substantive matters that warrant perspective and debate.  Any matter coming before the Board for action should have been communicated to Board members well in advance if action is expected.  (Surprise is not a welcome element in the Board Room).  In addition to the background materials, staff recommendations should be provided along with the basis for those recommendations.  Any member of the Board should have the authority and ability to table any matter for which they feel unprepared to act, abstain from such a vote, or request additional information prior to casting their vote.

Driving the Right Conversation

I have counseled organizations many times that they should not underestimate the transformative power of driving the right conversation, one that equips people with the courage to confront problems, challenge assumptions and constructively disrupt bad habits. This tone-setting starts in the boardroom itself.

This is also incredibly important in establishing the function of the Board relative to the CEO (in our case, the President of the University).  If the Board doesn’t make clear the authority they have to hire, evaluate,and (when necessary) fire the CEO, then authority will vest in the wrong seat and the Board’s ability to set the tone will be dramatically diminished.  Perhaps no other single relationship better drives the organizational tone than that between the CEO and the Board (and more specifically the Board Chair).  If that is a relationship built on mutual respect, with clear authority vesting in the Board, and the dialogue reflecting a commitment to collaborative problem solving and confrontation of the most pressing problems, then the rest of the organization will follow in kind.  If, instead, it is a status reporting relationship built on packaging rather than content and lacking timely transparency around substantive issues. . . problems will follow.

I have found over the years that it is much easier to critique than it is to construct.  Modifying the practices of a Board with a deep history like that of Penn State will not be a rapid task, and despite all the calls for change, it should not be one we undertake lightly.  Reckless, ill-advised governance changes can have catastrophic, unintended consequences.  In my career advising Boards, I’ve often helped them navigate through the complexity of these issues by encouraging them to focus on the key principles upon which they want to build their governance functions.  For Penn State, the key principles must be rooted in restoring our reputation of integrity, restoring trust among our faculty, staff, students and alumni, ensuring our long-term financial viability and our ability to meet our Land Grant mission, sustaining a world-class educational and research institution, and driving innovation and economic growth for Pennsylvania and beyond. These principles, coupled with leading practices in Board governance as outlined above, can help Penn State’s Board function more effectively, even if other structural changes go unmade.

Next up?  Closing the Gap: Restoring accessibility of a Penn State education

That anger has many roots, but perhaps the most common among the alumni with whom I’ve talked is a general feeling that the Board acted in haste and that actions were taken without adequate consideration of their impact. They acted too quickly, without all the facts.

I’ve served on non-profit Boards and I’ve advised Boards of some of the ...]]> Every Penn Stater I talk to about the events leading up to November of 2011 shares a common emotion.  Many are hurt, some feel betrayed, but all are angry.

That anger has many roots, but perhaps the most common among the alumni with whom I’ve talked is a general feeling that the Board acted in haste and that actions were taken without adequate consideration of their impact. They acted too quickly, without all the facts.

I’ve served on non-profit Boards and I’ve advised Boards of some of the most complex enterprises in the world.  In my experience, Board members make decisions all the time without access to all the facts.  Organizational leaders and executives do it all the time, too.  It is the rare decision that comes packaged with all the relevant facts that are necessary to make a fully informed decision.  This isn’t a failing of leadership . . . it is, instead, an expectation. But the key point here is not that decisions get made without all the facts.  It’s that decisions should only get made that way when the facts aren’t available and circumstances call for leaders’ best judgement.  If the facts are available, management and the Board have an obligation to put them on the table and make sure they’re well understood when making decisions.  I think it will be some time in these difficult events at Penn State before any of us have all the facts.

I think Sue Paterno captured the feelings many of us had when she reportedly said, “after 61 years he deserved better.”  But if we believe that all of the mistakes were made that November night, then we are fooling ourselves about the complexity of the problems faced by Penn State and we are deluding ourselves with regard to the decision-making capability of any Board.  The uncomfortable and inconvenient reality is that the Board should have never found themselves assembled that November night equipped only with the lousy set of choices they faced.  Inaction long before November created the environment that brought us to those dark circumstances.

Regardless of how you feel about how the Board ultimately executed those decisions, their actions that night opened up a debate about the governance structure at Penn State and ignited calls for reform from thousands of alumni.  These underlying issues are the ones that need attention if we want to act on more than our anger.

Penn State’s Board Structure

By now, many of us are familiar with the make-up of our Board.

First, we have our “Ex Officio” members, including the Governor, the Secretary of Education, the Secretary of Agriculture, the Secretary of Environmental Resources and the President of Penn State.  The Governor also appoints six additional Trustees.

We have six trustees elected in connection with the State’s agricultural societies.  We have the nine trustees elected by the Alumni.  And finally we have six Trustees that are appointed to represent “business and industry,” selected by the other Trustees.

Our governance structure and our Board are a function of the original act incorporating the “Farmers High School” and subsequent Acts of the Legislature as well as various decisions in Centre County Courts.  While The Pennsylvania State University may be a corporation by way of legal structure, it does not enjoy the same flexibility nor degree of self-determination with regard to its governance as other organizations.  We are at the mercy of the State Legislature and the Governor.  Perhaps some legal remedy could be sought in connection with privatization, or legislative act encouraged as part of such an effort, but in the absence of those steps, all roads to structural governance reform lead through Harrisburg.

Some of the other candidates for the Board have suggested that our governance structure should be dismantled, and more Internet postings that I can count have called for “the whole Board to be fired.”  The simple reality is that the Board could resign, but they can’t be fired except, perhaps, by Legislative Act.  Similarly, since our Board was created by the Pennsylvania legislature and the structure they put in place has been reinforced through the last century by a series of Court rulings, even “simple” restructuring of our governance would require the same — a legislative Act.

Is there anything about the history of our relationship with the State of Pennsylvania that suggests we’re going to be able to persuade that body to legislate away their voice at Penn State?

Insights from our Peer Universities

We might be tempted to bemoan this terrible fact, but I think it bears mentioning that some of our peers in the Big 10 are living with governance structures that are in some ways even less appealing than ours.

Ohio State University enjoys a Board that sounds a little less cumbersome than our 32 member Board — they have 17 members.  But each and every one of their members are appointed by the Governor with the advice and consent of the State Senate for nine year terms.  Two of their Trustee seats are reserved for students of Ohio State. . . which sounds very progressive until you get to the next paragraph, which strips these students of voting authority.  As if that’s not bad enough, the paragraph further ensures that no sensible person would mistake these students for actual Trustees, clarifying that they should not be considered for purposes of quorum.  In the world of governance and Robert’s Rules, that’s sort of like saying they’re never actually present, even if they are.

Off to Michigan State.  These folks have embraced two seemingly incompatible ideas:  a small, strong Board built on populism.  How have they accomplished this magical fusion?  The Board is made up of only eight people — a small Board by most governance standards.  Small Boards can be good in some instances, because they tend to eliminate factions on a Board and the small size allows for easier consensus-building, clarity of authority, and rapid decision-making.  But these eight Trustees are elected by popular election with votes cast by the citizens of Michigan.  Essentially, these are eight state-wide officeholders.  Should they die, resign, or for some other reason be unable to serve their term, their replacements will be appointed by the Governor.

Ok, how about Wisconsin?  Well, 18 members, all appointed by the Governor for seven year terms.  But at least Wisconsin reserves two of those seats for students, and other than a sensible two year term for these students, there does not appear to be the gutting of authority and voice to which the good people of Ohio subjected their student Trustees.

One more . . . Indiana.  Those Hoosiers are practical people.  Nine Trustees for three year terms, of which six are appointed by the Governor, and three are elected by the alumni (one every year for staggered three year terms). In 1975 the State Legislature empowered the Governor to appoint a student member of the nine person Board, and there has been a student representative ever since.

So following this comparison to some of our peers, you’ve probably noticed a few interesting things, as I have.  We are more complicated.  We are larger.  We have no designated student representative (though we have had student representation by tradition).  We have multiple constituencies electing varying factions on our Board.  Our Board has the unique authority among the small group of peers to appoint a portion of its own membership.  And we are the only one of this peer group that seats our Governor on the Board and gives him a vote.

It suggests to me that structural changes are in order.

So what will it take?

I’ll re-emphasize the point that I don’t think change in the governance structure is likely to move through the PA Legislature, and even if it did, I doubt the Governor would sign it.  And even if those things would both happen, they would likely take a while.

But if we could overcome those barriers, there are changes that should be considered.  In my view, there are a few important steps that could be taken to strengthen and streamline our governance:

(1) Eliminate the Ex Officio seats on the Board except for the President of the University.  The Governor has plenty of voice as do others in the State government by virtue of the purse strings they hold and the regulatory oversight they maintain over many aspects of our University.  Does anyone really think if the Governor or the Secretary of Education calls with a point of view, we’re not going to at least hear them out?  They don’t need seats on the Board.  This step takes four seats away, leaving us at 28.

(2) Let the governor keep his six appointments, but designate specifically that at least one of these shall be reserved for a student at the University for a shorter term (two years).  And no gutting their voice . . . full voting authority with the same powers and duties as any other Trustee.  This has been tradition, I think it should be formalized.

(3) Eliminate or reduce the election of Trustees from the Agricultural societies.  I know some may cry foul given the importance of agriculture in the legacy of our University and in the economy of our State.  But as Ag Extension as a function of our University has continued to decline in importance relative to all of the other operations of Penn State, designating such a large block of representation to these societies is an outdated nod to another time.  The Governor could always appoint representatives from this constituency if he saw the need.  Cut this representation, taking away four and keeping just two . . . and that leaves us at 24.

(4) Maintain the alumni representation at nine.  With a smaller Board, this representation will naturally have a stronger voice.  But while I obviously see the importance of alumni representation, I disagree with those that are calling for a Board made up exclusively of alumni.  We are not the only stakeholders nor is an election process the best way to ensure that we have the compliment of skills, perspectives and capabilities necessary to lead an organization as complex as Penn State.

(5) This may be an unpopular view, but I believe the Board should retain its current ability to self-appoint trustees.  I see no need to designate these as “representing business and industry,” instead, these should be appointed by the Trustees in order to bring diversity of viewpoints to the table.  It’s also an opportunity to ensure that the skills and experience necessary to address our challenges are in the room. . . compliance or governance expertise, land development and architecture, research, medicine, etc.  I would propose in a smaller Board this representation be reduced as well, from six to four, leaving the Board at 22.

In order to provide for continuity with the two year student Trustee, terms should be shifted for all members from three years to four years.  In addition, term limits should be imposed.  No individual Trustee should be able to serve more than two consecutive terms, with the terms of the various contingents of the Board appropriately staggered to provide for continuity.

I’m an optimist at heart, but even I’m not optimistic that those changes could be pushed through the legislature.

So if we can’t change structure, we need to focus on the practices, policies and procedures adopted by the Board in its execution of its oversight and governance function.

So next up . . . Let’s talk Standing Orders, and why Process will trump Politics.

One of the questions that was presented to me by several alumni during Saturday’s “Meet n’ Greet” was the question of Penn State’s future — in the face of declining state support, can we remain state-related, or should we instead be pursuing privatization?

This is a pretty complicated question, and this post will likely be one of my longest.  But let me offer a quick executive summary:  even though some would say the Cornell model provides an ...]]> Is it time to take the “State” out of Penn State?

One of the questions that was presented to me by several alumni during Saturday’s “Meet n’ Greet” was the question of Penn State’s future — in the face of declining state support, can we remain state-related, or should we instead be pursuing privatization?

This is a pretty complicated question, and this post will likely be one of my longest.  But let me offer a quick executive summary:  even though some would say the Cornell model provides an easy answer, it does not.  This issue is intertwined with continued state funding and the decision has deep implications for our Commonwealth campuses.  If we’re going to keep the campuses, and sustain our Mission, our current model as a “state related” organization should not be dismissed too easily in favor of privatization.  If I haven’t lost you yet, keep reading . . .

Understanding the Problem

Privatization of a Land Grant institution like Penn State is not without precedent.  Cornell University, the Land Grant institution for the state of New York, is a private institution that operates in partnership with the state of New York.

As a practical matter, that arrangement is based on the fact that four of Cornell University’s Colleges:  the NY State College of Veterinary Medicine, the NY State College of Labor Relations, the NY State College of Life Sciences, and the NY State College of Human Ecology.  – are statutory colleges operated by Cornell under the State University of NY system.  Cornell is essentially authorized to operate those colleges as delegates of the SUNY Board.

But this complex structure led to questions as to whether Cornell’s statutory colleges (not the whole of the Cornell system) was a state entity or a private institution.  There was no question of its private charter, but what about in its contracts with the state?   In 2005, then Attorney General of the State of NY Elliot Spitzer issued a legal opinion declaring that, while the University received state funding, statutory colleges should be considered private organizations, not state operations for purposes of contracting with the state.  The opinion was based on both the law and historic precedent.  In one precedent used in the opinion,  the Court of Appeals acknowledged in 1999 the unique nature of Cornell’s statutory colleges, noting its “hybrid statutory character,” further describing it as “public in some respects, private in others.”

The result of this complexity?  If you thought Penn State’s 32 Trustees is cumbersome, get ready . . . Cornell’s Board has 64 voting members, plus four “ex officio” members with voting privileges, including the President of the University, the Governor of New York, the President of the State Senate and the Speaker of the State House.  Sounds familiar, but sort of worse.

So if you were thinking Cornell University had figured out some magical, simple structure to operate a Land Grant College as a private institution, that’s probably optimistic thinking.

There may be other models that warrant investigation, but even if we can get the structure figured out, there are other practical problems.  As a private organization, with presumably zero direct subsidy from the state, would we continue to operate the Commonwealth campus system as we do today?  Does any other private research institution have the same network of campuses across their state?  (Not that I’m aware of.)

The other practical problem?  How do you separate the hundreds of millions of dollars across Penn State’s history that WAS provided by the State to build facilities, maintain our programs or acquire the property on which those facilities were built?  No, not all of our land and facilities can be traced to public funds.  Some of them can be traced to restricted endowments from generous donors who provided very specific instruction on how these endowments would be used.  If privatization resulted in the closing of campuses which were built with some restricted funds, what exactly do we do with the endowment?  If we close and sell the facilities, what do we do with the proceeds of those sales?  These aren’t just interesting theoretical questions . . . these questions are potentially the ingredients for years . . . no, decades . . . of complicated legal and financial challenges.

I am a fan of the Commonwealth system and I believe we have an obligation to sustain it.  I attended University Park, but I know from my many discussions with parents and families that these campus environments provide an important alternative to University Park and make a Penn State education more accessible across our state, particularly for students from middle and lower income families.  The average family income for students at our campuses is significantly lower than that at University Park.  If we really mean what we say – that we want to make good on our Land Grant promise to keep an education accessible for all regardless of financial need — then I think we need to acknowledge the important role the campus system plays in fulfilling that promise.

I don’t know whether privatization is a good answer or a bad one, but I do know it’s not a simple one.  It warrants thoughtful exploration and we need to ensure we don’t rush into anything.  I also don’t know — because I don’t have the information necessary to make the judgement — whether all of the campuses are viable as continuing components of our system.  If they’re not fulfilling our mission in a way that extends a Penn State education and increases accessibility — if they’re losing money and making it more costly to provide a Penn State education, even if students in some communities would have to travel further without them — then I believe we need to evaluate their continued viability.  I also believe strongly that without continued state funding, more of our campuses would be at risk for failing any viability test we might apply.  Viability isn’t only about funding, it’s about reach of our Mission – but without “margin,” there is no Mission.  In other words, even non profit institutions like Penn State can’t lose money without impacting their ability to provide the services they promise.

So what will it take?

First, we need clarity from the State on their intentions.  Are they committed?  As you may have read in my last post, I think they should be — there’s more at stake than the price of Penn State tuition. In my view, funding of our state system of higher education and investments in education generally are critical components of the Commonwealth’s economic vitality.  The best solution to ensure the continued viability is recognition from the State of the important role the campus system plays not just for Penn State, but for the State of Pennsylvania — recognition accompanied by sufficient funding.

Secondly, let’s really understand what we’re getting into.  Many people are advocating privatization because they want the state out of Penn State’s business.  But I don’t think that’s likely to ever happen.  We’re the namesake of our Commonwealth, and most sensible elected officials won’t be eager to disconnect from our future.  Even without a direct state subsidy, we provide healthcare at the Hershey Medical Center, Agricultural extension across the state, research centers that are integral to our state’s future.  Our campuses drive economic impact in every community they serve.  Privatization alone, even if possible, won’t take the “state” out of Penn State.

In the end, this decision is really about the financial viability of our current system.  So the third step is to look carefully at our Mission: where are we hitting the mark?  Where are we missing it? In my previous role as Chair of a Nonprofit undergoing transformational change, we had to close programs that were losing money because sustaining them was simply impossible.  These were good programs doing good work, but we couldn’t afford them without jeopardizing the rest of our services.  Ultimately, we were able to transition those programs to other organizations — had we not, I doubt our doors would have remained open to the thousands of others who need us.

We need a fully funded Penn State, with focused programs that provide educational and research outcomes that make a difference and provide a social return on our investment.  We need committed alumni and continued engagement with the philanthropic community.  With these pieces in place, I believe we can ensure a Penn State education is accessible to all without regard to financial need.  But I don’t believe anyone should be putting a stake in the ground and declaring privatization as our way forward until we’ve thoughtfully explored the question and fully understand the implications of our strategy.

Next up?  Understanding that governance is evolution, not revolution.

During my Penn State visit last week, I had the opportunity to tour the Millennium Science Complex, one of the newest additions to the University Park campus.  An imposing architectural wonder, its 297,000 square feet houses two of our University’s premiere research organizations, the Material Research Institute and the Huck Institute of Life Sciences.  If you ever wanted to see evidence of the power of Penn State to change the world, take the time to visit ...]]> Another Great Thing You Probably Didn’t Know about Penn State

During my Penn State visit last week, I had the opportunity to tour the Millennium Science Complex, one of the newest additions to the University Park campus.  An imposing architectural wonder, its 297,000 square feet houses two of our University’s premiere research organizations, the Material Research Institute and the Huck Institute of Life Sciences.  If you ever wanted to see evidence of the power of Penn State to change the world, take the time to visit this incredible facility.

The building fuses two important disciplines, serving as a catalyst for faculty, staff and students engaged in both the Material Sciences and Life Sciences arenas.  Within its walls teams are working, researching and envisioning the future, including the latest innovations in “biophotonics.”  Biophotonics brings together biology and the study of photons — quantum units of light.  That’s about as deep as I go. . . but thankfully there’s a whole lab full of people at Penn State that know more about it than I do.

Researchers, faculty, labs and equipment in Material Sciences and Life Sciences used to be spread across campus, without the opportunity proximity provides to bounce around an idea, inquire about ongoing projects, or spark new collaborations.  No more.

This building is pursuing LEED certification, with green roofs that reduce cooling and heating expenses by up to 30%.  Innovation is at every turn, but perhaps the most remarkable thing we saw during our tour were the “quiet labs” housed under the gardens where the two wings meet in their cantilever.  They are inside the basement complex of the building, but structurally separated from the exterior in order to minimize sound.  And like virtually every day I’ve spent at Penn State, I learned something on this tour. . . not that sound creates vibrations (knew that), but when you’re looking through an advanced microscope at nano-sized units, the slightest vibration (like someone walking two floors above or construction a mile away) can blur the image.  A blurry image delays the advancement of an idea, clouds our insight, and slows our progress.  The quiet labs in the basement of the Millennium Complex exceed the highest standards for facilities of its kind.  In other words, clearer insights and accelerated innovation, here at Penn State.

One project being advanced in the building is the development of a “lab in a chip.”  Picture routine medical testing (like blood screening) being done not in laboratory facility (expensive to build and maintain), but in devices that are embedded in credit card-sized “machines.”  The “lab in a chip” becomes a “hospital in a briefcase,” bringing opportunities not only to mobilize healthcare to corners of the world previously unreachable by modern medicine, but also to help us control the ever-rising cost of healthcare in developed nations, including our own.  This facility is an asset not just to the students and faculty of Penn State who can participate in the research and whose classroom experiences will be informed by the discoveries and progress made there, but also to every resident of Pennsylvania and indeed the world.

These are the wonders and promise of Penn State, another example of what makes Penn State great and why our vision and our commitment must be to ensure this promise is kept for generations to come.

Pennsylvania’s funding for higher education, and Penn State specifically, has been a target of significant state budget cuts.  Last year, a proposed 50 percent reduction in funding was ultimately reduced to a 20 percent cut, and this year, Penn State faces a proposed 30 percent reduction in state funding.  Current trends indicate Penn State’s funding is on a crash course toward zero.

Governor Corbett asserts that this funding represents only a small part of Penn State’s operating budget, 1.8 percent.  But that ...]]> To me, it’s very simple.

Pennsylvania’s funding for higher education, and Penn State specifically, has been a target of significant state budget cuts.  Last year, a proposed 50 percent reduction in funding was ultimately reduced to a 20 percent cut, and this year, Penn State faces a proposed 30 percent reduction in state funding.  Current trends indicate Penn State’s funding is on a crash course toward zero.

Governor Corbett asserts that this funding represents only a small part of Penn State’s operating budget, 1.8 percent.  But that figure includes all operations, including the University’s research programs and the Hershey Medical Center.  The impact to the funding of core educational programs would be much more significant, driving the cost of a Penn State education even higher.  The average in-state student already leaves Penn State with more than $28,000 in debt.  My wife and I both funded are own educations through a combination of part-time work, scholarships, loans and grants.  But the gap today for students is much larger, and the proposed budget cuts will increase the pressure.  We must slow the growth of the accessibility gap, and ultimately reverse its course.

Recent events at Penn State have highlighted the role the Governor and his appointees play in our system of governance and the Board of Trustees.  But if the Commonwealth wants to continue to have such a voice in the decision-making of this institution, isn’t it reasonable in return to ask them to sustain a level of funding that is commensurate with the positive economic impact driven by our University?

What will it take? 

It will take a comprehensive (and collaborative) vision as to how this University will partner with the Commonwealth going forward. Pennsylvania benefits tremendously from the economic impact, research, innovation, and talent development that takes place across all of our campuses.  If Pennsylvania wants to continue to reap those benefits, they need to commit to our shared success.  That means sustaining funding, and abandoning the assault on state support of Penn State (and other institutions of higher education) that has been the hallmark of the last few years.  I fully recognize the fiscal challenges our state faces.  But cutting current funding will take future, long-term benefits off the table.  I believe abandoning the State’s commitment to its Land Grant University is short-sighted, and in the long run will cause more problems than it solves.

So what’s so simple about such a complex problem?  In short, if Pennsylvania wants a strong voice, it can speak up with a stronger commitment to sustainable funding.  In return, Penn State needs to do all it can to evaluate educational and research outcomes and ensure the returns are commensurate with the investments.

The common vision is a successful Penn State, producing talent that can compete in a global economy, and innovations that will drive future advances (and economic growth) in the industries that matter most to our country, including energy, pharmaceuticals, technology, agriculture and healthcare.  Not only do the students of Penn State deserve that commitment, but so do the citizens of Pennsylvania and those across the US whose lives are positively impacted by the important work done by the talented faculty and staff across our University.

Next up?  My views on the promise and perils of privatization.

It was a privilege to talk to alumni, members of the faculty, and friends of the University on campus this morning.  They shared their relentless optimism for Penn State, but they also acknowledged nagging concerns about some of the issues we face.  While the implications of the Sandusky scandal and the actions of the Board in November were on the minds of ...]]> What will it take to address the concerns that were shared with me and nearly 60 other candidates during the “Meet ‘n’ Greet” today?

It was a privilege to talk to alumni, members of the faculty, and friends of the University on campus this morning.  They shared their relentless optimism for Penn State, but they also acknowledged nagging concerns about some of the issues we face.  While the implications of the Sandusky scandal and the actions of the Board in November were on the minds of nearly everyone, most of the  people I talked to today highlighted other challenges facing Penn State that they felt warranted even more attention.

Over the next few days you’ll hear what I think it will take to address these other concerns, issues I believe need to be front and center if we are to sustain Penn State for the future.

First up . . . What kind of relationship should we expect with the Commonwealth of Pennsylvania?

My schedule on campus began with a meeting of the Information Sciences & Technology Advisory Board, and a brief Q&A with President Erickson, including a discussion on the future of funding for our University, the role of the State, and the continued need for the University to properly manage costs to remain competitive and affordable.

While that dialogue is critically important, ...]]> Spent the day on campus at Penn State and it gave me a great opportunity to spend time with students, faculty, and members of the administration.

My schedule on campus began with a meeting of the Information Sciences & Technology Advisory Board, and a brief Q&A with President Erickson, including a discussion on the future of funding for our University, the role of the State, and the continued need for the University to properly manage costs to remain competitive and affordable.

While that dialogue is critically important, it remains unfinished.  We have much more to do as we work to ensure that “For the Future” is not just a beloved line from our Alma Mater but also a constant reminder of the obligation we have to ensure Penn State remains accessible to all regardless of their financial need.

This is an obligation that’s important because it’s about the promise made by our Commonwealth and the promise made by our University. I think it’s important to keep our promises.  But it’s also important for other reasons, and those reasons are about education and research as an engine for economic growth and opportunity.  They’re about the “Great Things” we have to offer, the incredible assets of this University that make its whole represent so much more than the sum of its parts.

And speaking of those incredible assets . . . my day wrapped up with a celebration.  Over 150 students from across the University came together to celebrate their new careers at PwC, as interns and full time hires in our offices across the country.  They are the students of today and the business leaders, philanthropists, entrepreneurs and public servants of tomorrow.  They are brighter, more tech savvy, more community-minded and better connected than I ever hoped to be, and they inspire confidence that our future is in very good hands.  Congratulations to all of them.

I first met Toni Pergolin in 2004, when I was serving as the newly installed Chairman of the Finance Committee at Bancroft.  At the time, we were facing a significant range of financial and operational challenges, and we had undertaken a turnaround.  Toni came to us from ...]]> Toni Pergolin, (’85) is doing great things with great people.  Toni is the CEO at Bancroft in Haddonfield, NJ.  Bancroft is a non-profit that serves more than 1500 children and adults with intellectual disabilities, acquired brain injuries and autism.

I first met Toni Pergolin in 2004, when I was serving as the newly installed Chairman of the Finance Committee at Bancroft.  At the time, we were facing a significant range of financial and operational challenges, and we had undertaken a turnaround.  Toni came to us from her previous post at the University of Pennsylvania, and, as our new CFO, was tasked with driving the change that would secure Bancroft’s future.

With an undergraduate degree in accounting from Penn State, and a Masters in Health Administration from St. Joseph’s University, Toni was exactly the kind of leadership Bancroft needed at a critical time in its history.  For 125 years, Bancroft has helped thousands of individuals and families build lives of dignity under the most trying of circumstance, acting in a tradition of respect and compassion that people of all walks of life, regardless of their intellectual disabilities, deserve. Toni embodies this remarkable tradition.

Under her leadership, Bancroft began to communicate its vision for the future with a simple statement:  One World.  For Everyone.  Toni lives that vision every day, and the lives of thousands of individuals (including my daughter’s) are made better by her commitment to service.

Graduating with a degree in accounting from Penn State gave Toni many options for her future.  Universities can produce future titans of industry, poets, or business people.  Some, perhaps, focus on how they can enrich themselves.  Penn Staters like Toni Pergolin graduate with a desire to make the world a better place, to serve others and make a mark that’s not about them, but about the legacy they leave for others.  For all of us as Penn Staters, it’s a story with a familiar ring to it.  She is one example of thousands, and the positive impact she has had on my family and a community I care deeply about is immeasurable.

We’ve been through a lot recently as a Penn State community, but it’s easy for us (and even easier for others) to lose sight of what we’re really all about.  Toni is a true Penn Stater, demonstrating our values through her actions every day, like thousands of her fellow alums.  She is a great reminder to every Penn Stater that We are . . . Great Things!

Have a story about another remarkable Penn Stater?  Send me a note and I’m happy to share it.  You can reach me on joeatkinsonpsu@comcast.net.