Skip to content

Whose University?: Corporate Governance and Democracy at USC, by Max

August 28, 2011

You think you can do whatever you want just because your corporation is a university?” -Cartman from South Park

At USC there’s a disconnect between the democracy as publicly enshrined in the values of our administration and the democracy which is to be studiously avoided in practice. The structure of USC more closely resembles the top-down organization of corporations where a CEO and board of directors make all important decisions while the thousands of other employees and stakeholders have very limited official channels of influence. The prestige of being an elite university does a lot to mask what might otherwise be considered unjust and anti-democratic.

One way the value of democracy is held as a virtue at USC is in the pronounced values of our highest administrators. President Max Nikias’s official bio on USC’s website (1) proclaims “he enjoys teaching freshmen about ancient Athenian democracy …” USC Provost and law Professor Elizabeth Garret’s scholarly interests include “direct democracy” and “democratic institutions,” according to her official USC profile (2). Despite this wealth of knowledge of democracy bunched up among the top officials at USC, I think a closer analysis of USC will show that the idea of a general “power of the people”—from the Greek demos meaning people and Kratos meaning power—is scarce.

In order to understand—and be able to ultimately change—any institution, it’s necessary to look at the structures of governance, decision-making, and political power. In examining USC’s official policies and rules, I hope to show how USC’s governing structure is administered purely from the top down.

The Board of Trustees

USC’s Board of Trustees is a body that is rarely mentioned or discussed but whose influence at our school is vast. USC’s “University Governance” section within its SCampus booklet states that:

NOW, THEREFORE, BE IT RESOLVED, that the Board of Trustees, acting through its officers, has both the right and responsibility to and hereby does affirm its final authority over the on-going institution, and nothing in the Statement of Student Rights and Responsibilities or any other policy pertaining to any subject promulgated by this board shall be construed as in any way abridging the basic powers, rights and responsibilities of this board” (3).

It appears USC is governed in an absolute manner from above, starting from the Board of Trustees, which “is a self-perpetuating body, electing one-fifth of its members each year for a five-year term of office” (6). The University Governance packet goes on for two and a half pages describing all the rights that students have, but as the excerpt claims, these rights can’t “abridge” what Board chooses to do.

I recommend every USC student look over the full list of the roughly 55 Trustees online to learn about who makes the final decisions at our school (4). They are nearly all CEOs or other executive officers of large corporations. The corporations represented include weapons manufacturers that have won billions in defense contracts from US wars abroad (Northrop Grumman), oil companies with atrocious human rights records (Occidental Petroleum), and banks that have helped devastate the global economy (Goldman Sachs) (see later articles in this guide for more in-depth articles on each of these and others). The make-up of the board and the history of its members makes it hard to imagine that it has much respect for human well-being and dignity when governing USC.

The President

In general though, the Board of Trustees is not the face of the university and very few students, faculty, or staff pay any attention to the Board or, sometimes, even know it exists. It’s really the university president and the administration that are the face of the USC and their institutional roles are thus: “The president is the chief administrative officer of USC. He or she carries out policies established by the trustees and, in doing so, has the power to delegate this authority to the officers of the university” (3). In so many words, the president is an adept middle-man that does and tells others to do what the trustees want.

Another point of similarity between for-profit corporate structure and many private universities is that the Board of Trustees often looks upon the head of the institution as deserving immense compensation for his or her work. In the latest statistics available, the USC Board of Trustees gave $1.9 million in total compensation in 2008 to then-president Steven Sample, making him perhaps the most highly paid University official in the country (the Washington Post article listed all the highest salaries and Sample’s was the higher than the rest), which by default probably means the highest-paid university official in the world (5). This might not be as much of a problem if there weren’t thousands of USC students struggling everyday to pay rent and tuition and USC workers weren’t struggling for livable wages.

Private universities are also integrated into the corporate sector not only by having a board composed of corporate executives, but the university presidents themselves also often serve on the board of directors at multi-million and -billion dollar corporations. In a New York Times piece titled “The Academic-Industrial Complex,” President Sample was one of the university executives singled out as being a particularly blatant example of corporation-university intertwining having served on the boards of 12 corporations over the last 30 years, 19 of which he was USC’s president (6). According to the NY Times, this dynamic has started to raise concerns:

Some analysts worry that academics are possibly imperiling or compromising the independence of their universities when they venture onto boards. Others question whether scholars have the time — and financial sophistication — needed to police the country’s biggest corporations while simultaneously juggling the demands of running a large university” (6).

As the article argues, university presidents have a lot of public prestige attached to them that can make a company look good when sitting on its board directors. The university president in turn gets a nice annual payment for doing what amounts to little work as a corporate board member.

And Nikias is not one to fall behind his predecessor’s corporate appeal and savvy. Recently on July 14th, current president Max Nikias was elected to sit on his first board of a large corporation, Synopsys, which chose him because he “will be valuable in helping us shape our corporate strategy for the benefit of our customers, investors, partners and employees” (7). Reflecting his apparent mindset in an interview given in earlier this year Nikias said, “we live in a business world” (8).

I can think of two broad conclusions that this evidence points two: 1) university presidents like Nikias and Sample are respected in the corporate world and chosen to sit on their boards because of the corporate-like nature of running a university and/or 2) these presidents are paid as a public relations ploy to make their company look respectable. In any case, this synergy between the for-profit corporate world and the university further blurs the lines that supposedly distinguish both (more on this below).

Student Government

If the president of our university has relatively limited power in the university, one can’t expect to find much meaningful decision-making influence in a lower-level body like the student government. USC’s “University Governance” section states that:

The Undergraduate Student Government and the Graduate and Professional Student Senate are the official representative student governments of the University of Southern California with power to make studies, reports and recommendations to the President of the university in any and all matters pertaining to the well-being of the student body. The role of the student government within the areas of its jurisdiction shall be reviewed by the university administration only through orderly procedures and channels” (3).

The student government can make studies and reports, but the most it can do in terms of having relevant influence on school policy is to make recommendations to the president. In the face of the trustee’s “final authority” and the president’s subservience to that end, the student government would seem poorly situated to give student voices meaningful and democratic weight in the running of the university.

Student Media

Ideally, the media acts as a sort of watchdog over the actions of sectors of power in society that gives ordinary people a probing perspective of what’s going on. On why this is not the case for the student newspaper, the Daily Trojan, at USC, see the article later in this guide titled “The Daily Trojan, Free Expression, and What It Means to Be a ‘Student’ Newspaper.”

Faculty Department Autonomy

Traditionally, faculty in higher education have had a significant amount of control over their departments at universities. The primary purpose this served was that it gave professors the academic freedom to study what they wanted and do research in areas of their choosing without fear of being reprimanded or fired by a university president with an opposing opinion. This was also seen as fair because the faculty themselves are in a much better position, professionally, to judge the academic work of candidates for jobs in their department than, say, a university administrator with no experience in that particular discipline.

At USC over the last decade and with alarming intensity over the last year, administrators have been systematically intruding on faculty department self-governance. In a number of cases, administration officials and the deans of colleges, who are not a part of the individual faculty departments, have been denying tenure to professors even after the faculty departments democratically voted to give them tenure. And perhaps most alarmingly, this has been happening overwhelmingly to women professors of color whose research could be perceived as politically against the grain.

For instance, this happened when last year the Department of American Studies and Ethnicity the Department of Religious Studies both recommended Prof. Jane Iwamura for tenure because of her outstanding contribution to these fields (9). The dean of the College of Arts, Letters, and Sciences then vetoed this recommendation and in doing so, robbed the faculty of their long-respected right to choose their professional colleagues.

Another part of this department autonomy has been democratic control over who the chair of their department. Last year, the Department of American Studies nominated Prof. Laura Pulido and Prof. Judith (Jack) Halberstam to chair the department. Again, the dean of the College denied both nominations, which constitutes a virtually unprecedented intrusion on the formerly robust self-determination of academic departments at USC.

As a consequence of these actions as well as general harassment of professors who are critical of the USC administration, many of USC’s most highly respected and most-loved professors are leaving for jobs at other universities. As professors spend their lives studying and teaching, doing so in a hostile environment can seriously inhibit their ability and duty to do their jobs well.

USC as a Non-Profit

Although technically USC is a non-profit, the policies it pursues and how it uses its money make it in many ways indistinguishable from a typical, large for-profit corporation. One advantage to this status is that USC is exempt from paying almost any taxes and therefore can accrue wealth at a faster rate (and give more money to its top administrators).

In many areas, USC seems to be acting identically to those notorious for-profit companies like Wal-Mart who seek to maximize profits for shareholders. For instance, USC’s actions against unions are particularly harsh. To mention one recent conflict (though the full history is long and troubling) in 2009, USC bought the USC University Hospital from the Tenet Corporation, a private, for profit company. Under their contract with Tenet, the union at the hospital had a generally workable relationship with the hospital administration. Despite being legally bound to respect the existing union contract upon purchase, after USC acquired the hospital, management and administration—with the hired help of The Weissman Group, an expensive union-busting consulting firm based in Ohio—waged an aggressive campaign to oust the union. USC engaged in illegal activities like firing workers without just cause because of their vocal support for the union and arresting union organizers without signing, and thus not taking legal responsibility for, necessary arrest forms. The healthcare workers’ initial excitement over being able to work for a famous school like USC quickly subsided as it became clear that the supposedly “not-for-profit” USC sought to vastly reduce union rights and subcontract their jobs to cheaper outside companies to cut costs.

A glance at USC’s Board of Trustees gives the impression that they collectively are very skilled at making profits for private corporations, but their credentials mostly have little to do with higher educational and non-profit institutions. It seems likely that such a board would act as its members are accustomed to act (to make money for shareholders), not in manner to which they are inexperienced and unqualified for (running a university to ensure quality education).


USC’s concentration of decision-making at the top and the resulting policies that disempower students, workers, and professors gives USC no incentive to be transparent. Likewise, how and where USC spends student tuition money is virtually unknowable beyond the extremely vague financial reports that are released each year and which consist of aggregates of general expenditures and revenues (10). Pertinent questions, like how much does USC spend on security? On executive and board member salaries? How much profit does USC make off of the mandatory freshman meal plan, where every breakfast, lunch, and dinner at EVK costs more than $10? Where does USC invest its $2.9 billion endowment? If it’s in oil companies, weapons manufactures, and hedge funds, like the companies whose CEOs sit on our board of trustees, is that cause for concern? These questions are central to understanding our role in our education as well as USC’s role in society at large. Yet no amount of asking USC officials or pouring over official USC documents will give more than hint as to where our money goes.

All of these factors coalesce to make USC a profoundly undemocratic place for students, faculty, and staff and an excessively democratic place for wealthy CEOs of private corporations who sit on our Board of Trustees. Although few major universities come close to a democratic ideal of higher education governance, USC, on all of the above-mentioned issues, ranks among the worst. As universities increase their enrollments, tuition, and global influence, it’s worth reflecting on what kinds of governments they most resemble as top-down structures. More importantly, it’s worth imagining what a democratic school could be like and working to realize it.

Sources Cited











3 Comments leave one →
  1. David permalink
    August 30, 2011 2:53 am

    This is a great article and a topic that needs to be widely discussed and understood within the university. Thanks for shedding light on it.

    I was just doing some research on the Trustees for a community organization near USC (I’m also a student at USC) and I came across your article. I was beginning to wonder who these people are and why they’re all CEOs (and not just any CEOs, but chiefs of some of the biggest companies in the US and around the world…Northrup Gruman, Tata Motors, etc.). Your article has made things a lot more clear, thank you. Now it’s just a matter of spreading the word. It would also be interesting to interview some trustees for another piece (I’m guessing they wouldn’t be too accessible, but you never know…).

  2. David Bennett permalink
    August 30, 2011 3:04 am

    P.S. I just realized that I, like you, had written my comment with only my first name.

    Maybe I missed your last name elsewhere – but if you want to speak truth to power, then why sit down in the back of the classroom?


  1. Table of Contents « Uscundercurrent's Blog

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: