Reflections of a Former Trustee
How the Penn State Board of Trustees Really Functions
By Ben Novak ‘65
I was elected to the Penn State Board of Trustees more than two decades ago, and served on it as an alumni Trustee for twelve years—from 1988 to 200. I came on the Board thinking that it was a deliberative body such as one reads about in civics books. It is not.
It took me years to understand what was really going on. In what follows, I hope to shed some light on the inner workings of the Board, as well as to explain both why the Board remains so secretive, and why it has offered so little public leadership to the University since this scandal erupted.
The simple truth is that it is not simply a few bad apples who have brought about the humiliating situation we face. Rather, it is the way the Board of Trustees has structured the whole governance of the University that has made this scandal not only possible but almost inevitable.
I. Who Runs the Board
To understand how the Board works, one must understand how one set of Trustees runs it. The thirty-two-member Board (actually forty-eight members when one includes the sixteen Emeritus Trustees) consists of four separate groups: the Power Group, the Praetorian Guard, the Emeritus Trustees, and the Sheep—with, however, the latter divided into two subgroups.
THE POWER GROUP
The Power Group is a self-selected group of the wealthiest and most powerful members of the Board consisting of from three to five Trustees who consider themselves the real Board. They hire and fire the president; set the salaries of the top administrators (and their retirement packages and benefits); meet or talk with the president frequently; fly around in the president’s jet; attend meetings around the country on behalf of the University; and approve of all the policies the president sets. They do this with little or no input from the majority of Trustees.
While the president of the University is a member of this group, he remains president only so long as this group considers him one of them. Indeed, there is almost no distinction between this first group and the administration itself.
Around this first group are seven or so other Trustees whom we shall call the Praetorian Guard, so-called because, like the original Praetorian Guard of the Roman Emperors, they form the cohort around the Power Group. They are often consulted by the Power Group, always support whatever the Power Group decides, and generally consider themselves to be part of the Power Group although they are not in the president’s company as much. The Praetorian Guard is mostly made up of the richest members of the Board, but some make it into this group by reason of long association wit major components of the University.
The third group consists of the Emeritus members of the Board, who usually number about a dozen, but there are presently sixteen. This is a special club of former Board members who have served at least twelve years on the Board, and are found to be “distinguished,” i.e., rich and compliant. If a member asks too many questions or wonders about following rules, one will not recieve Emeritus status, even if one serves twelve years. (Personal disclosure: although serving for twelve years, I was not offered Emeritus status, which is too bad, because Emeritus members are invited to attend all meetings of the Board even after their terms as Trustee are over—with their travel and hotel costs paid by the University.)
Emeritus members cannot vote, but they can speak at meetings, and can serve on all committees, just as though they were still on the Board. Emeritus Trustees are the cheerleaders for the Power Group and the Praetorian Guard. Their age, experience, prestige, and wealth are meant to charm or intimidate all new members to “get with the program.”
THE INFLUENTIAL ONES
These three groups together—the Power Group, Praetorian Guard, and Emeritus Trustees—constitute the Influential Ones. The Chairman of the Board appoints almost all the membership of special committees of the Board from these three groups. Members almost always nominate each other as the Board’s officers; members of the Executive Committee; and presidential selection committee. They approve or disapprove hatever policies the president chooses to implement—or formulate them with him. They are the gatekeepers of all University business.
Next come the twenty or so other Trustees who can only be called Sheep. They receive information about meeting agendas a few days before each meeting, and are expected to approve whatever is on them. The Sheep, however, can be subdivided into two subgroups.
SHEEP I—TRUSTEES WITH AN INTEREST
The first subset of Sheep are those who come onto the Board with a special interest in mind. This might be to set up a new, or expand an existing, program such as in hotel and restaurant management, or to get involved in a particular University area, such as the new colleges of Communications or Biophysics.
These Sheep are utterly dependent on the first three groups for the good will of the Power Group to get anything done. They often spend long hours in meetings with administrators and faculty members working on setting up the funding or parameters of their special interests. These Trustees tell many stories of the bureaucratic hurdles they had to overcome to get anything done. At the end, however, they often have a real feeling of accomplishment. In return for the privilege of doing all these things for Penn State, all they have to do is to unquestioningly rubber-stamp everything the Influential Ones want.
SHEEP II—POOR LITTLE SHEEP
The second group of Sheep consists of those poor naïve souls, such as I was when first elected, who believe that the Board is actually a deliberative body to guide the University in keeping to its original purposes—who believe that they are called “Trustees” because the care and welfare of the University and its thousands of students and faculty are entrusted into their hands.
This second set of Sheep is bound for nothing but heartache and disappointment. Their opinions will rarely be asked for. Since they are never told much of what is going on, except to receive the meeting agendas a week or so before the meetings, there is little for them to do but to attend the meetings and approve whatever is on the agenda. If they raise any serious question, they are told to meet with the appropriate administrators who will answer their concerns—after the meeting is over.
EXAMPLE: THE APPOINTMENT OF A PRESIDENT
The Influential Ones never tire of repeating that the appointment of the president of the University is the single most important act the Board does. If there is any doubt, therefore, that the majority of the Trustees are treated as Sheep, consider the appointment of Graham Spanier as president of the University in 1995.
The previous president, Joab Thomas, announced a year before his retirement that he would not be renewing his contract. In the ensuing year, the Board discussed at several meetings, and even had an all-day work session to discuss in generalities, the qualities that they were seeking in the next president.
But when it came time to actually consider candidates for the job, the whole process closed. A search committee of the Board, composed of Influential Ones was appointed by the Board Chairman. From that point on the rest of the Board was excluded from any involvement. Not the slightest word of whom they were considering leaked to the rest of the Board. Eventually the committee of Influential Ones selected Graham Spanier. A week or so before the meeting at which their choice was to be approved, a notice was sent to all Trustees advising them of the selection, and the next day the newspapers were profiling Penn State’s next president.
A day or so before the meeting at which the Board was to vote, I spoke with the Board secretary and asked if the rest of the Board would have any opportunity to meet the nominee before the election. She advised me that nothing like that was planned. I suggested that this was strange, and that at least we ought to be able to say we shook the next president’s hand before we voted for him.
A few hours later, I received a call from the chairman of the Board, who began by cheerfully telling me that the Board secretary had spoken to him of my call, and gee, that was a good idea. So, the chairman wanted to personally inform me that the I should be at the Nittany Lion Inn an hour early for the meeting, since a cocktail hour was now scheduled at which Graham Spanier would be present for all the Trustees to meet him.
At the cocktail hour, the entire Board, a majority of whom, like myself, had never heard of Graham Spanier until a few days before, had an average of barely two minutes each to say hello and shake his hand. Immediately after the cocktail hour, the Board filed into the next room and, as the first order of business, dutifully voted him in as the next president of The Pennsylvania State University.
II. How the Board Governs the University
As the Sandusky scandal goes on and on, many people wonder what responsibility the Board of Trustees has in all this. The answer lies in how the Board has set up the University to be governed. In a nutshell, the Influential Ones, most of whom are businesspersons, have set it up to be run as a business corporation on the model of Enron, concentrating all the power and information flow in the hands of the president.
To understand how they have done this we must delve into the documents by which they have structured the deal. While the discussion that follows may seem detailed and legalistic, it is simply a situation where the old saying applies: “the devil is in the details.” We shall be concerned here specifically with Standing Order IX entitled “Governance of the University.”
THE BOARD’S REMOVAL OF ITSELF FROM RESPONSIBILITY FOR POLICY
Section (1)(a) of Standing Order IX recognizes the Board of Trustees as the “corporate body established by the charter with complete responsibility for the government and welfare of the university.” This means that the Board is responsible for what goes on … but not really.
Section (1)(b), entitled “Guiding Policies” almost completely absolves the Board from any responsibility, because subsection (1)(b)(1) delegates not only the “day-to-day management and control of the University” to the president—which is normal—but also delegates the “establishment of policies.” Thus, the Board effectively removes itself from responsibility for policy; the formulation of policy is delegated to the president. So, if there is a policy that Emeritus Professors can use the showers, that is no longer the responsibility of the Board—the president did it.
This is why there is never any substantive discussion of policy at Board meetings; all policy-making is delegated away. Down further in Section (1)(c), the Board retains the power to determine the “major goals of the University,” but only to approve the “policies and procedures for implementation of such goals.” Thus all policies come to the Board already fully formulated by the president and the Power Group.
This delegation of policy-making to the chief executive may not seem totally unusual to business Trustees, since many boards of directors of corporations-for-profit do the same. The idea is that a board of directors hires a CEO and says, “the whole corporation is yours to lead; all we expect is that you will produce profits.” This is why CEOs command such high salaries: they are paid to produce results. For the board of a profit-making corporation this makes things easy—all it needs to judge the CEO is look at the profit and loss statement. But for a non-profit institution entrusted with the education and care of thousands of young people it is near to a dereliction of duty.
THE IMPOSSIBILITY OF OVERSIGHT
But it gets worse. Even if the president-CEO is charged with making all policy, the Board could still exercise considerable oversight. But the Influential Ones have set up the flow of information so that it is impossible for a Penn State Board member to get any independent information about how the University is being operated or how its policies are working.
Subsection (1)(b)(2) entitled “Reports and information required” says—and this is deserving of bold letter treatment—This delegation of authority requires that the Board rely on the judgment and decisions of those who operate under its authority.” In other words, those operating under the authority of the Board do not do so under the direction of the Board, but rather the Board simply hands over the whole institution to whomever they appoint, and relies on their judgment.
Now let us see how Standing Order IX forecloses any meaningful oversight. The next two sentences of Subsection (1)(b)(2) are truly Orwellian. The first says, “However, this reliance of the Board must be based on its continuing awareness of the operations of the University.” But how shall the Board members maintain “continuing awareness”? The following sentence makes this impossible, for it establishes that the president is its sole source of information. It reads, “Therefore, the Board shall receive and consider forthright reports on the affairs of the University by the president or those designated by the president.”
Thus, if the Board wants to know how the president’s policies and procedures are working, the Board has no independent way to find out. Rather, the Board’s very rules require it to ask the president to tell the Board how his policies are working. Not even profit-making corporations are this careless; they require independent verification. Not so for the Penn State Board of Trustees; like the Board of Enron, there are no independent sources of information except the very officers the Board appoints.
THE PROHIBITIONS AGAINST ANY INDEPENDENT SOURCES OF INFORMATION
Further, Standing Order IX positively prohibits Board members from getting information from any other source. Section (4) dealing with Faculty has a subsection (c) entitled “Communication with the Board” that provides: “Official faculty communication to the Board of Trustees shall be made through the president.” Section (5) dealing with Students has the same language in subsection (b): “Official student communication to the Board of Trustees shall be made through the president.” What these two provisions mean is that no one on the faculty, and no student leader, may attempt to provide information to the Trustees except by sending it through the president.
In practice this means that if any faculty member or student leader contacts a Trustee to inform them of what is going on, and that Trustee attempts to check out the information through the president’s office, that faculty member or student will be contacted by the president’s office and reprimanded for violating Standing Order IX. I know: for, early on when I dared to mention the source of my information to the president, that source received such a call. It has also been reported that several student leaders and faculty members over the years have been warned by the president’s office to avoid contacting Trustees.
The same is true if a Trustee wants to investigate anything by talking to an administrative employee. Employees are directed to report to the president’s office before giving information to a Trustee. I have several times walked into administrative offices to request an appointment and watched the frantic calls reporting my presence to the president’s office.
Nor is this prohibition on information gathering placed solely on the sources of information. Standing Order IX actually prohibits individual Trustees themselves from independently gathering information. Section (1)(f) entitled “Expectations of Members (referring not to what the members of the Board expect, but what is expected of them) specifically provides in subsection (12) that individual Board members shall “Respect established channels to acquire information.” Since the only established channel is through the president’s office…well, you get the point.
Thus in summary, although Subsection (1)(b)(2) majestically proclaims the need for each Board member to maintain “continuing awareness of the operations of the University,” these other sections and subsections quite insidiously make that impossible.
III. Why We Hear Nothing from the Trustees:
The Silence of the Lambs
Ever since the Sandusky scandal erupted, members of both the University community and the public have been puzzled by the silence of the Trustees. Many find it hard to believe that all thirty-two of the individual Trustees were in favor of firing Joe Paterno, and they naturally wonder why none of them has spoken out. When any other type of governing body is called to deal with a problem, individual members usually offer their ideas as to how it should best be handled. But there has been not one peep from Penn State Board of Trustees members. Why is that?
The answer lies in the rules of the Board, specifically Standing Order IX, which contains without doubt some of the most amazing rules you will ever read governing the conduct of democratically elected representatives.
Section (1)(f)((5), for example, requires that members are expected to: “Speak openly within the Board and publicly support decisions reached by the Board.” While the first part of this sentence—“Speak openly within the Board”—is laudable, the second part—“and support decisions reached by the Board”—is not. What the second part means is that no member of the Board may publicly speak against a decision of the Board once it is adopted. Thus, the silence of the individual members on the Board is guaranteed by the rules of the Board.
To get an idea of how ridiculous this is, imagine that the US Congress had a rule that once Congress adopted Obamacare, no member of Congress could thereafter speak publicly against it or urge its repeal. Yet, that is exactly what the rule governing individual members of the Penn State Board of Trustees states. One of the constant mantras that I heard repeatedly while on the Board was that the “Board acts as a Board, not as individuals.” What this was meant to enforce is that any dissent from a vote of the majority of the Board is considered speaking against the Board itself.
This rule is further buttressed by two others. Subsection (1)(f)(10) requires the individual Trustee to: “Maintain confidentiality without exception.” Thus individual Trustees are enjoined from ever reciting the arguments he or she disagrees with. Think of the scene of the entire Board sitting as silent as stones behind John Surma as he announced the firing of Joe Paterno—and you will have some idea what this rule means in practice This rule is further used to get Trustees to agree to unanimity after-the-fact, because even if they oppose an action before its adoption, they are bound to support it after it passes.
Subsection (1)(f)(11) requires that each Trustee shall “Advocate the University’s interests, but shall speak for the Board only when authorized to do so by the Board or the Chair.” This could be interpreted reasonably, but it is not. How the Influential Ones interpret it is that no Trustee may publicly give his or her idea of what is in the University’s best interest unless he or she first gets the permission of the Board or the chairperson of the Board. Of course, no permission will be given to speak against any action the Board has already taken. Thus, once the Board acts, every individual Trustee is required by the rules to remain silent—which is exactly what the public has seen since the Sandusky scandal erupted.
IV. The Root of the Problem:
Centralization of All Power in the President
The root problem with the Penn State Board of Trustees arises from the centralization of all the powers of the University into the hands of the President. This occurred in July 1970.
Prior to this, the academic side of the University was governed by a whole plethora of largely independent parts. These consisted of departments, loosely presided over by department heads, who were in turn loosely overseen by deans of the colleges, as well as a variety of relatively independent programs such as Agricultural Extension Services, all largely working independently, though in concert. All of these in turn were very loosely brought together in the Faculty Senate.
This was theoretically only one part of the University—the Faculty. The second part consisted of the student body, roughly organized as the Student Government Association, or the All-University Cabinet, or the Undergraduate Student Government, as it was called at various times. Believe it or not, in many respects and at various times the student government through its chartering powers had slightly more control over its organizations—such as the fifty-six independent fraternity houses, its thirty-three independent sororities, the house governments in the dorms, and the multitude of independent student organizations that existed on and off campus—than the Faculty Senate. Indeed, back then the student body organized more university-wide activities than the faculty did.
The last loosely organized third of the University was the administration, which was supposed to be directly, but was actually only loosely, under the control of the president of the University. I say “supposed to be directly but was actually only loosely” for two reasons. First, because there were often conflicting lines of authority. For example, before 1970, the chief administrator in charge of student affairs was the Special Assistant to the President for Student Affairs. But he had no authority to promulgate policy regarding student affairs—that was vested in the Faculty Senate. Thus neither the president of the University or the chief administrative officer had direct control over student affairs. The same lack of direst control held true for many other sectors of the University.
The second reason that the president of the University had only loose control over even his own administration was that nearly all employees in administration could exercise a large degree of discretion in how they handled their responsibilities. For example, Agricultural Extension and most research activities on campus looked primarily to their sources of funding and the communities they served, rather than to the central administration for guidance.
Over most of these multifarious arms of the university, therefore, the president had little real power, although he had a lot of authority. The difference is this: that while power is exercised from above, authority is given by those below. Thus the president of the university could rarely order what he wanted done from on high, but his prestige was such that Deans, department heads, program directors, and student leaders tried mightily from below to get together in order to accommodate whatever policies or other changes the president desired, though they still exercised a whole lot of discretion in how they did it.
The president’s real prestige and authority came from the general understanding that we were all united in working for the good of the whole institution. This is what held us together and made Penn State so dynamic. It was the source of our great Penn State pride. We did things, not because we were ordered to, but because we wanted to. We were tremendously proud that we all had a part in determining where Penn State was going and what it was aiming to become.
Also, before the centralization, there were hundreds of checks and balances throughout the university system—nobody could get away with much for very long, because there were too many people watching. Everything was everybody else’s business because we were all in this together. Everyone kept one eye open for what was best for the University as a whole—and the other eye open for what was not….
At that time, too, there were a lot of men and women who, although they had no power that you could see on an organization chart, were nevertheless so highly respected that their opinions carried a lot of weight far beyond their job description. Penn State was not an organization of mechanical parts back then, but was an organic whole, where the slightest pain in one limb was instantly communicated through the whole body.
But in 1970, all this began to change. Not suddenly but gradually an entirely new mentality began working itself through the Penn State body. It said: all that matters is who has the power—and this was determined by organization charts. Whole new positions and offices grew up to make regulations and tell everybody how to do their jobs. Turfs were no longer decided by what was best for the University, but by who had the power. Respected professors found themselves of no more account than a brand new administrator or a newly minted instructor. Countless rules were made that made no sense to those who had to enforce them, but were ordered from on high.
Before 1970, a Jerry Sandusky would have been out on his ear at the first whisper of improprieties. This would have happened at the lowest level and few above would need to know about it. The problem simply would have been gone before anyone had to think about it—and the kids would be—and indeed were—infinitely safer than they are today.
EXAMPLE: A VERITABLE EPIDEMIC
In the 1990s while I was serving on the Board, several nurses from Ritenour Health Center were upset, they told me, because there was a veritable epidemic of venereal disease—herpes, gonorrhea, chlamydia, syphilis, AIDS, etc.—on campus. They came to me because tall their attempts to get administrators at Ritenour or higher to do something about it had been fruitless.
The problem that I faced was that the nurses were afraid to allow their names to be used because they were afraid of losing their jobs. Therefore, I could not name anyone that administrators could go to in order to confirm what I told them. Nevertheless, I talked about the issue without naming any names with administrators who shrugged their shoulders; and with other Trustees who listened politely and said, “this is the president’s problem, he’s in charge;” or “We can’t talk about this kind of thing at the Board of Trustees level.”
By the 1990s, no one below the president had the power to institute, or even investigate anything, no matter how serious it was, unless his or her immediate superiors knew that the president approved. This, of course, was during the administration of a president who had done his doctoral research on the virtues of wife-swapping, a fact of which everyone was keenly aware.
The problem was the same with the media; they wouldn’t touch the story. I talked about it to Collegian and Centre Daily Times reporters as a story worth investigating. But they completely ignored it. They needed blessings from on high to venture into a story like that. So, no word ever went out to the students about what some nurses thought at Ritenour was a major health problem.
(Personal confession: Perhaps I should have done more. I don’t know how many students now go through their lives bearing the scars of venereal disease. Maybe I am the Joe Paterno and Mike McQueary of a similar issue in an earlier age; if so, I know exactly how they feel. But I also know that even if I had stood on the rooftops shouting it, it would not have made any difference to the administrators or been covered in the media—I would only have been shouting into the void.)
My point in all this is to show how the 1970 decision of the Board to vest all power in the president has played out. In the type of atmosphere that centralization creates, it is no wonder that a Jerry Sandusky could haunt the showers for years with no one taking action. Joe Paterno was the only one who took action—he kicked him out of the football program thirteen years ago. That should have been the end of it; for, when Joe disavowed Sandusky as his successor, that would have set off alarm bells. But no, in a world where only presidential power matters, Sandusky could worm his way into wherever he wanted by bureaucratic manipulation. So, he continued to haunt the showers, and neither the head of Athletics nor the head of Police Services could really act on their own. Nothing happens anymore at Penn State unless and until the president says so.
This is the system of governance that the Board of Trustees set in place since 1970, and it is the key to how the whole place functions. It is why a scandal such as the Sandusky affair was not only possible but darn near inevitable—and there may be many more out there that have not surfaced yet.