For Succession Planning, Insiders Generally Fair Better
When the time comes to choose a new executive for an organization, insiders have many advantages, the most important of which is their familiarity with the organization. As Academic Impressions reports, hiring an executive internally can save a year or more of productivity. Among the findings: In the corporate sector, 4 out of 5 new CEOs are hired from inside the organization, and in terms of their tenure, “inside” CEOs usually outlast outsider CEOs. What’s most interesting is why: “It takes a long time to really get to understand how a company works,” one of the consultants remarked. Lapovsky, who has written. Read More.
CEO Expense Accounts Under New Scrutiny
Scandals over CEO Expense Accounts, like the recent University of Texas Southwest Medical center investigation, can bring large damage to an organization’s reputation over relatively small amounts of cash. As ECFA reports, keeping organizational and personal expenses separate is crucial to avoiding scandal, maintaining reputation and carrying on in accomplishing the organization’s mission. The board chair, the chief executive, and the general counsel should sit down together to figure out the best way to ensure that the CEO has the discretionary-expense guidelines he or she needs, and the board gets the accountability it deserves. The first task is to craft workable guidelines. Read More.
Lawmakers Consider Making Nonprofit Universities Pay More Taxes
As 2011 comes to a close, large universities are looking back on a very good year for their endowment funds. As The Fiscal Times reports, Harvard University, which holds the largest endowment fund in the nation, showed a 21.4 percent return on investments, growing by $4.4 billion to a total of $32 billion. Cash-starved government entities are paying more attention than ever to the discrepancy between these profits and the extensive tax relief offered to these institutions. “At some point, a nonprofit gets so rich that it seems kind of obscene to let wealthy universities get out of paying taxes,” said James Miller, an. Read More.
10 Challenges for College Presidents This Year
College presidents have the unique task of balancing interests of all groups present on a campus. Faculty, staff, students, alumni and investors all look to that person to provide guidance and make the final decision. The Washington Post recently asked L. Randolph Lowry, President of Lipscomb University in Nashville, to highlight the 10 challenges he anticipates facing in the 2011-2012 school year. 1. The “new normal” may be permanent. In a conversation with our state’s newly elected governor, Bill Haslam of Tennessee, together we concluded: “You and I may never serve through ‘good times.’” We cannot count on the economic factors that. Read More.
Colleges Making Smarter, More Targeted Spending Decisions in Downturn
The face of university spending has changed dramatically in the past three years, and the Delta Project has been covering that shift. Collecting and organizing data on spending, revenues and several other measures, the Delta Project shows that, while the gap between private and public revues is widening, most institutions have handled the recession very well, even increasing spending in instruction.
Surveys Show University CFOs Maintain Cautious Outlook
Two studies by separate institutions recently took a reading of the current outlook of hundreds of college and university CFOs. One study by the Chronicle of Higher Education of 500 college CFOs shows those institutions maintaining current spending levels for the foreseeable future. While 60 percent of the CFOs said it was “very unlikely” that their institutions would make layoffs in the coming year—and an additional 18 percent said layoffs were “somewhat unlikely”—nearly 39 percent said it was still very or somewhat likely that their institution would freeze hiring for nonfaculty positions. As they begin the 2012 academic year, CFOs of community colleges and. Read More.