Mega-Foundations Do Not Negotiate With Universities – Here’s How
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A donor, let’s call him Steve, recently tried to support a faculty member’s work at his alma mater. Months of negotiation came down to one clause, quietly inserted, letting the dean redirect the funds if circumstances changed. Steve struck it. The university put it back. Several more months of wrangling followed, the grant nearly died, until the university conceded on the last day of the fiscal year.
Who can blame a university for trying to maximize its options? That is simply what any rational economic actor does. The interesting question is how some funders skip the process entirely. Foundations can hand the university a form, say “take it or leave it,” and the university signs it. The difference is not, as one might assume, the size of the funder. Rather, it appears to be routing and frequency.
Three funders, zero negotiations
Public disclosures and public records requests have revealed how three large funders—the Gates Foundation, the Andrew W. Mellon Foundation and the Charles Koch Foundation—approach grant contracting with universities. The striking thing is not what any of them ask for. It is that, on paper at least, none of what they asked for was contested, period.
Several features jump out, beginning with the fact that the terms are fully standardized. Gates bluntly says key clauses “are non-negotiable.” Across the three, the recurring provisions are unilateral termination, clawback of unspent funds or redirection to another grantee of the funder’s choice and ongoing audit or monitoring rights. Universities do not disclose to would-be funders that they routinely concede to such conditions—because universities want to maximize their flexibility
