Did a business ethics scholarship result in unethical behavior?

For this post I am going to protect the innocent (and perhaps the guilty) as I want to simply share the experience- I'll leave out the bad actors.

The development officer for the college approached me for a donation. His pitch fascinated me....there had never been a fully endowed business scholarship in the history of the school. It was shortly after my father had passed away from cancer and I was trying to think of a way to remember him. The development officer suggested I endow a scholarship in my father's name. I liked the idea.

At the same time I was thinking about a scholarship, the news was all about bad actors like Enron, Tyco and Andersen. The headlines screamed about unethical and illegal behavior. Eureka, I'll make the scholarship about business ethics and require students to do a case study where they were put in an ethical dilemma. I told the development officer I would fund the scholarship individually for three years. If all went well I would endow the scholarship with a lump sum.

This was lining up as a very impactful giving opportunity. The scholarship was "full tuition" and I knew that college tuition typically outpaces inflation- by a lot. So it was a very attractive opportunity. I funded the scholarship for three years and decided to endow it with $100,000. A few years went by and each year I would get a letter from the school and or recipient thanking me for the scholarship. Then one day I got a letter from the school but this time the letter was different. Instead of a m"scholarship" in my father name, it was now an "award".

Award I thought, that's interesting, what changed and when. Well it seems at some point the school concluded that a cash award was better for their foundation then a scholarship. Suddenly the first time "full scholarship" had become a cash award of $5,000. Wow, how disappointing. They changed it and never even bothered to let me know.

The fact that the change from a full scholarship to a cash award was done quietly and without my knowledge or consent seemed, well, unethical. That point of view was not lost on me but was apparently not shared by the school. After numerous emails, letters and phone calls with the school I gave up. It was obvious they were not going to honor the donor intent.

The scholarship remains an award today. Did I sue? No. Did I contact the dean or college President? No. What I did do is decide the school would never get another dime from me or my family. It is unfortunate that well meaning people and good institutions are so capable of bad behavior. When non profits make these short term decisions they are missing the bigger picture. I believe it was a Goldman Sachs parter who coined the phrase "long term greedy". More non profits should try and think long term with donor relations. And donors should beware that promises made are not always promised kept.

If you like this article or think it would be interesting to someone you know, please forward.