Dear Senator Grassley,
Although it is unfortunate that events at American University have initiated your involvement, the Student Government wishes to thank you for the attention and interest you've given our institution and the governance challenges it faces. As you are aware, on May 31, 2006, the American University Board of Trustees responded to your letter expressing your concerns on governance reforms. We would like to take this opportunity to provide our own perspective on the letter that the Board provided you.
By early November 2005, the AU Student Government provided the Board of Trustees with a Comprehensive Action Plan of almost thirty pages that described in detail the governance changes necessary to transform the Board of Trustees into a more transparent and responsible body. Despite numerous requests for a progress report throughout the first half of 2006, it was not until a week prior to the Board of Trustees' May 2006 meeting that the Governance Committee actually contacted Student Government leaders and updated us on the status of governance reform. This short notice gave both former Student Government President Kyle Taylor and I little time to negotiate with the Governance Committee and alter the inadequacies we saw in the reforms they proposed.
By the time the Board of Trustees meeting rolled around, both leaders from the
Student Bar Association, the Graduate Leadership Council, and I knew that the chances of seeing most of our suggestions as presented in the Comprehensive Action Plan realized were slim to none. On the second day of the Board meeting, however, we were pleased to find out that the trustees decided to add a recent graduate of the university to the body as a voting member after we consistently demanded that one nonvoting student trustee was not acceptable. This new position was received very positively, yet its addition did not change the fact that many provisions within the Comprehensive Action Plan were ignored. The students of American University still hold legitimate concerns regarding the Board of Trustees' reforms. They are as follows:
1. Though the student body welcomed the addition of seven new trustees to the Board, the thirteen trustees who awarded former University President Ben Ladner an almost 4 million dollar severance package are still Board members. They voted to award Ladner the package after it was discovered that he improperly used university funds. Despite already breeching their fiduciary duty to the university, they have refused to resign from the Board of Trustees.
2. Our Comprehensive Action Plan's suggestion that three voting student trustees be added to the Board was rejected. In the Board's letter to you on May 31st, Chairman Abramson remarks that student leaders expressed overall pleasure with the reforms adopted by the Board except for the fact that they "would prefer more than one student trustee." The Chairman's understanding of our suggestion is incorrect - we would prefer voting status on the Board of Trustees before multiple nonvoting student trustees. The Chairman also cites the fact that 85% of private colleges and universities do not have faculty and student trustees as support for the Board's decision on this matter. The AU Student Government however believes that universities who do have student representation on Boards are cutting-edge progressive institutions consistent with American University's values; such institutions include public and private universities such as Cornell University, Rutgers University, the State University of New York, Syracuse University, and Duke University.
3. There is a general perception that many of our suggestions were not taken as thoroughly as we would have liked them to be. Though the Board stripped the President of voting power and a seat on the Executive Committee, the new bylaws presented by the Board make what should be an independent, transparent Compensation Committee a subcommittee of the Executive Committee. Though the Board touted the addition of a student trustee, this trustee lacks the ability to participate in decisionmaking through voting. Though the Board did incorporate our suggestion that there be four meetings a year, there is no attendance requirement placed on trustees to maintain their membership. Full participation in Board operations enhances the legitimacy of decision-making.
The Student Government shares the same commitment to the values the Board has said they have pursued in their reforms, such as accountability, transparency, and responsiveness. We do agree that the changes enacted thus far represent substantial effort and major improvements. However, we believe our Comprehensive Action Plan's original suggestions represent the complete version of a truly responsible governing body that our Board of Trustees has yet to become. Full student and faculty membership on the Board is something that the Student Government will continue to strive for at American University. Regardless of changes enacted by the Board, there is still substantial distrust of trustees in the student community. Governance reforms may set up an infrastructure for a Board of Trustees to perform duties sufficiently, but its actual members must display a commitment to the best interests of the university. The thirteen members of the Board of Trustees who chose to reward dishonesty with our tuition dollars have not at all displayed this commitment. The Student Government again thanks you for your interest in American University and the manner in which Boards function at the non-profit level. It is your interest that has legitimized the student voice of AU. At the corporate level, a Board of Trustees as a fiduciary body is fundamentally accountable to the stockholders of the company. American University is a non-profit institution, has a Board of Trustees, and yet is accountable to no one. The students and their parents are the investors in American University and we call for accountability and transparency on our Board of Trustees. We ask for your support in passing legislation designed to place voting student and faculty to the Board of Trustees and remove all Board members who voted in favor of the Ladner severance package. Furthermore, we thank you for your overall efforts to improve the way that non-profit institutions are governed.
Sincerely,
Ashley Mushnick
