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The Corporation’s New Era

Harvard’s governing body seeks specialists while increasing transparency

Meddling with the structure of a nearly four-century-old institution would be enough to make most people a bit nervous. For University President Drew G. Faust, it gave her shivers.

Harvard’s historian president announced late last year that she would significantly reform the Harvard Corporation, the University’s highest governing body. The decision to change an organization that has essentially remained static in form since its founding in 1650 resonated strongly with a woman steeped in American history.

“Changing the Corporation gave us shivers,” Faust said. “I have never felt more a part of a tradition and that we were intervening in ways that were preparing Harvard for its next century and perhaps the century beyond.”

The reforms, which overhauled the oldest corporate body in the Western hemisphere, include nearly doubling its membership from 7 to 13, the introduction of six-year term limits for members, and the creation of new subcommittees.

Though the reforms sound bureaucratic, their tremors may be felt far down the organizational chart.

But shivers or not, it remains unclear how the historic expansion, announced in December, will impact how the Corporation carries out its work, increases accountability in the aftermath of the financial crisis, and responds to calls for more transparency.

In large part, the Corporation’s new direction will be shaped by the individuals who join in the coming years. But the short list is a tightly guarded secret that no one close to the Corporation is willing to disclose.

And until the new members are announced and the subcommittees’ work is underway, the impact of the Corporation’s restructuring cannot be measured, and its success as a modernized governing body remains to be seen.

WHY NOW?

After 350 years of fairly smooth sailing, a structural overhaul of the Corporation might seem unexpected. While the Corporation underwent a review in the 1970s, it did not result in any significant changes, according to Henry Rosovsky, a former member of the Corporation and a former dean of the Faculty of Arts and Sciences.

Pressure to reform had been building for several years and had both internal and external origins before culminating in 2008.

The economic crisis of that year rocked global markets and resulted in a precipitous drop in the value of Harvard’s endowment and led the entire University “to take a hard look at its role and operations. The Corporation thought it should not be an exception,” according to a report issued by the Governance Review Committee.

Reform at Harvard has mirrored a broader concern within higher education to more critically assess universities’ exposure to risk.

Former University President Lawrence H. Summers’ rocky departure from Harvard also contributed to soul-searching within the Corporation, the body that was responsible for hiring and firing Summers.

All this took place against a backdrop of reform within governing bodies in the private sector that followed the Enron and WorldCom scandals, according to Graduate School of Education professor Richard P. Chait.

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