UPDATED: May 2, 2012, at 6:47 a.m.
A full house of faculty members nearly forced a motion to delay the elimination of the Financial Planning Group—announced in an email to faculty by Provost Alan M. Garber ’76 on Friday—by six months at Tuesday’s Faculty Meeting of the Faculty of Arts and Sciences.
They also unanimously approved the passage of new concentrations in Electrical Engineering and Mechanical Engineering, both to be offered by the School of Engineering and Applied Sciences.
The meeting, which is the last of the semester, also saw the approval of courses of instruction for 2012-2013 across the University and at the University Extension School. It concluded with an update by Garber and Senior Associate Provost for the Harvard Library Mary Lee Kennedy on the restructuring of the Harvard Library.
Although the motion to delay the closing of the FPG, which required a four-fifths vote from the 167 faculty present to pass, was not approved, many faculty members were visibly upset that the office will be shut down effective June 30 of this year.
Four faculty members sent questions about the issue to University President Drew G. Faust in advance of the meeting, and four others raised new concerns at the meeting itself—in excess of the normal two extemporaneous questions allowed by the Faculty Meeting rules during Question Period.
Professors cited the critical role the FPG has played in helping faculty manage retirement funds and plan major investment decisions.
Jeffrey F. Hamburger, professor of German art and culture, added that the services offered by the FPG—which have, in the past, been explicitly offered to ladder faculty in their contracts—are often a critical recruiting tool when attracting new faculty to the University.
“I know many faculty who would not have been able to contemplate a move to this expensive part of the country without financial advice,” he said.
Faculty called for an explanation of how the University would maintain the services offered by the FPG—or provide alternatives.
“This is not a cost issue; it’s a liability issue,” Garber said. By paying for the service of financial advice to faculty members, he said, Harvard could be held accountable for investment mistakes made by faculty. “It’s a very exposed position for the University to be in,” he continued, adding that no other University in the Ivy Plus consortium has a similar service.
According to David I. Laibson, professor of economics, the University has negotiated with multiple retirement providers, including Vanguard, Fidelity, and TIAA–CREF to provide personalized services to faculty.
But some faculty expressed concern that advisors at these companies would be operating under conflicts of interest to maximize their sales, an issue that both Garber and Laibson agreed should be addressed.
As evidenced by German professor Peter J. Burgard’s motion to delay FPG’s end and establish a committee, including faculty, to discuss alternatives, faculty members were largely unsatisfied by the solutions proposed by Garber and Laibson. They also expressed frustration that the announcement was made so late in the year.