Each month, The Michigan Daily sits down with the University of Michigan President Mark Schlissel to discuss important questions about University policy, commitments and challenges. Topics discussed in this month’s interview included the endowment, Provost Martin Philbert, sexual misconduct policy, GEO bargaining and health services at U-M Flint and Dearborn.
This interview has been edited and condensed for clarity.
The Michigan Daily: At the Regents meeting on Thursday, after many student protests, the board announced they were freezing all fossil fuel investments while they study the current investment policy. Would you like to comment on this?
Mark Schlissel: Well, they didn’t announce they were freezing, they said they weren’t bringing forward new, direct investments in fossil fuels. And they just want some time and space to study the question of whether our investment policies are correct or not. So, I think there is a shoutout due to student advocacy. I think the board hears the advocacy and wants the time to discuss what the smart way is to move forward. … But, you know, the board is responsible for this almost $12 billion endowment, and it’s a very serious fiduciary responsibility, and we have to live up to our commitment to the donors that gave us the funds that became the endowment to consider the potential yield, and then how much risk we’re willing to accept as the main factors in deciding about investments. So, the board has to really look carefully at its responsibilities.
TMD: In late September, the Public Accountability Initiative released a report showing that $26 million of the University endowment was invested in private equity fund Lime Rock Partners as of October 2018. The fund finances oil driver Tim Dunn and Empower Texans, a conservative group that has a major role in supporting far-right rhetoric and legislation, such as opposition to same-sex marriage, in Texas politics. In our interview last month, you told The Daily ideology does not play a large role in the endowment. Do you believe the University should work to incorporate the beliefs of the student body in its investments?
MS: No. So, what I said last month is still the same. Imagine if we start making, as a filter for our investments, the perceived political beliefs of the people that own or manage the firm that’s doing the investing. Who gets to decide what political beliefs are allowed? And why should we make decisions about investment opportunities, not based on the risk and the reward of the investment, but based on our perception of whether we like the beliefs or not of the person who owns the business? I think that’s both inappropriate and very risky. You know, in a world where we value free speech and we value diversity, I think I can disagree with the owner of a business but still do business with the business. So, I don’t think those things should enter into investment decisions at all. … So, the student voice is important, but it doesn’t have a big input into the endowment.
TMD: I guess I want to push you a little on that, because some of these organizations oppose same-sex marriage or gender-neutral bathrooms. Does the University not have an obligation to not invest in organizations that directly or indirectly might cause harm to others?
MS: My understanding is it’s not the organization that’s causing the harm, it’s an individual who is one of the owners of an organization who gets paid a profit because he’s running a business and that he decides or she decides what they want to do with that profit. Can you imagine how difficult it would be to make investment decisions at all if what we had to do was not just look carefully at the company we’re investing in and what they do but look at the people who benefit from those investments and what they do with the money they’re benefiting (from). I think that’d be almost an impossible task.
TMD: Last interview, you said, and I quote, “We make a commitment to the donor to be a good steward of their money.” In the past, when the Regents have divested from apartheid South Africa and the tobacco industry, was there a financial indication that divestment from these industries was the best way to steward these donors’ money? Do you think they made the right call?
MS: You know, it’s really tough to use hindsight to make these decisions. When it comes to the tobacco industry, it’s still a thriving, money-making business. So, it’s not clear that divestment affected the tobacco business, but way fewer people in your generation smoke than in my generation in college. So, I think there has been a movement away from cigarettes, which is a good thing. So, I think it’s complicated to assess whether divestment played a role in decreasing the popularity of smoking as compared to lots of research and then some good public interest campaigns and advertising. When it comes to apartheid, it’s also very hard. I think it’s unarguable that, in its day, apartheid was the most obvious and visible manifestation of evil in the world, affecting tens of millions of people. The fact that it was dismantled speaks to the consistency and bravery of many freedom fighters within South Africa, Mandela, the most famous of them. It speaks to a global pressure campaign that eventually influenced the government of that country. And I could imagine that the symbolism of people changing their investment patterns may also have influenced the eventual outcome. It’s hard to say what had the biggest responsibility for the very good change that occurred.
TMD: Do you think the symbolism of universities around the country divesting from fossil fuels could have the same impact?
MS: That’s a good question. I don’t know. Personally, I don’t think so. And the reason I don’t think so is, where I’d be spending my energy is working on demand for fossil fuels. So, what the divestment movement is working on is the supply of resources that that industry has to meet the demand. But, if the demand for fossil fuels goes up, there’ll always be entities that invest in fossil fuels, and the degradation of the environment will continue whether Michigan’s heavily invested in it or not. The symbolism I think is important to many people, and I see why. What I would be focusing on is putting pressure on our elected leaders to develop rules that hasten the transition to a low carbon economy.
TMD: At the Regents meeting, a public commenter called on the University to make all endowment investments and records public. Is this something the University would consider?
MS: No. The reason why is we try to do research and hire smart people to help us invest our endowment to generate more money than the average investor. Over the last 20 years, we’ve averaged nearly 10 percent a year, and that’s with all the ups and downs of the economy over this very long period of time. It’s important to the University that we have a competitive advantage when it comes to our investment decisions. If we were to simply tell everyone what we’re going to do before we do it, we give up our competitive advantage.
Provost Martin Philbert and Robert Anderson
TMD: The Detroit Free Press recently released an article claiming the University administration knew about Provost Philbert’s alleged misconduct. One example was a lawsuit the University settled in 2005 alleging Philbert engaged in inappropriate conduct with a female researcher in his toxicology lab. Another example is when former Provost Phil Hanson received multiple emails to investigate Philbert’s behavior. Do you have a response to these allegations?
MS: The things you mentioned are being investigated by the outside firm we’ve brought in to help us address allegations made against Provost Philbert. While those things are being investigated, I’m not going to talk about the details of the investigation, other than to say we have asked the investigators to address questions dating from the very beginning, so when the Provost worked for the University. … This case from the mid-2000s was when Provost Philbert was running a research lab, and it was an employment case brought by a male researcher that he let go. Nowhere in that lengthy lawsuit is sexual misconduct claimed against the Provost, and then during the adjudication case, there’s a discovery period where witnesses get deposed under oath, and nowhere was there a witness that said they observed sexual impropriety.
TMD: Recent allegations against the late Dr. Anderson, former UHS Director and team physician, came out. What steps is the University taking to ensure that this pattern of sexual misconduct among high ranking University officials — and claims that the University was aware of them — stops now? Instead of providing support after the fact, how is the University working to proactively stop this before it happens?
MS: I think the most important thing in the short term is to understand as many facts as we can. We can look backwards and say, “What are the things that we might have done differently that would have prevented this inappropriate behavior from going on as long as it did?” That’s part of the goal of the investigation, to learn what those things are. But in general, we need to develop a culture, and every time I talk about this topic I say the same thing, where people feel comfortable coming forward when they either believe they’ve been mistreated, sexual misconduct or any other kind of misconduct or harassment or if they witness or hear about somebody else being treated mistreated. Then on our end, the promise is to take every one of these things seriously and investigate them thoroughly. … In the case of Dr. Anderson, who passed away more than a decade ago, it’s a little bit harder to investigate so far backwards. But our police did a very thorough job. The prosecutor, probably because Dr. Anderson had passed away, decided there weren’t criminal violations to be brought, but we’re continuing to investigate. We have a law firm helping us with that investigation.
TMD: During the public comment portion of the Regents meeting last Thursday, speakers claimed University Human Resources threatened not to negotiate over salary and benefits until the subjects of climate, housing and protections against sexual misconduct were dropped entirely from the coalition’s platform. If this is true, why is the University removing certain issues from the negotiating table completely?
MS: I have read — although I’m not involved in the bargaining — that GEO wants to include issues about carbon neutrality and issues about things that don’t just affect them but affect everybody. And you can imagine it might be difficult to have a negotiation with one particular subset of our community, or an issue that affects everybody in the community that we’re dealing with separately.
TMD: Both GEO and the University have agreed to reach a tentative agreement by March 1. What can you tell us about how this process is going so far and how the University is working to support its graduate student employees?
MS: I know that the clock is ticking as we’re heading towards March, so I would share a sense of anxiousness that we actually make serious progress, so we don’t bump up against the deadline. The graduate students are the lifeblood of the University, and we’re the biggest public research university in the country, if not the world. Most of that research is done by our graduate students. They’re our partners in scholarship, they’re our successors very often in the academy; they’ll be tomorrow’s professors and leaders in society. So, we’re invested in their success.
Health Services at U-M Flint and Dearborn
TMD: The University of Michigan offers UHS care to all students at the Ann Arbor campus. While the median income on the Flint and Dearborn campuses is significantly lower than on the Ann Arbor campus, they have no access to campus health services. Why is this?
MS: Although you can walk in to the health service here, it’s not free — you’re paying for it. So, there’s a student fee charged in Ann Arbor that’s specifically dedicated to the health service that pays for their budget, so you are paying for the health service. Flint and Dearborn in the past have each had on-campus health services that turned out to be used very rarely, and we think the reason why is most of the students in Flint and Dearborn come from the communities that surround Flint and Dearborn; in other words, they’re very often still living at home or living with their families in a community where they’ve already been functioning as adults, so they have their own health care. … In Flint and Dearborn, however, in both cases, the University makes arrangements for students that don’t have health care to get convenient health care. … So, rather than maintain their own and charge students to maintain it when it’s rarely used, they have relationships with local health centers.
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