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Investment Luminary Highlights Academic Gifting Trend

Tom Burroughes, Group Editor , October 9, 2018

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The trend of investment big-hitters giving large gifts to academic institutions continues.

A recent record-breaking gift to Wharton’s business school – one of the few institutions around the world with a wealth management course – is another reminder of how ultra-high net worth individuals are using some of their assets.

Last week it was reported (Bloomberg, Oct 2, others) that Marc Rowan, a co-founder of Apollo Global Management LLC, gave $50 million to the Wharton School at the University of Pennsylvania, the largest single gift in Wharton’s history. The money will help to recruit three Rowan Distinguished Professors, appoint Rowan Fellows and support the Penn Wharton Budget Model, which analyzes government spending and revenue. Bloomberg said the gift is greater than the $40 million given by Jon Huntsman Sr and family in 1998.

Rowan chairs Wharton’s Board of Overseers and co-chairs the More Than Ever campaign. He made the gift with his wife Carolyn. After receiving undergraduate and MBA degrees from UPenn, he worked at Drexel Burnham Lambert before joining Apollo.

There have been a number of high-profile bequests to US universities in recent months, and in one case, it has led to controversy. Last year, for example, Ken Griffin, founder and chief executive officer of investment firm Citadel, donated $125 million to the University of Chicago's Department of Economics. (See other examples of such donations here and here.)

As reported on March 8, a $100 million charitable bequest to finance conflict-resolution research via the University of Chicago turned into a bust-up of its own. The case may raise questions over the understandings entered into by the creators and operators of such organizations - a key issue amid recent major bequests by ultra-high net worth individuals.

In 2015, Thomas L Pearson and Timothy R Pearson donated the money to the university to create a research institute bearing their name to push the cause of world peace. But the Pearson Family Members Foundation wants to reclaim the $22.9 million it has paid so far, alleging in a lawsuit that the school breached its obligations under the grant agreement. A trial is reportedly scheduled for the summer of next year.

Wharton
The business school, with the Institute for Private Investors, offers a private wealth management program, designed to educate high net worth families in working with advisors. Additionally, the business school runs a set of course focusing on areas such as investment management, venture capital, hedge funds, private equity, impact investing and corporate finance topics.

This publication carries a list of courses around the world that have some relevance for wealth management. 

Susan Winer, chief operating officer and a founder of Strategic Philanthropy, has written about the issues of major gifts here.

 




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