Clarence Hall University and the Donation

9 Pages Posted: 30 May 2017

See all articles by Bidhan L. Parmar

Bidhan L. Parmar

University of Virginia - Darden School of Business

Jenny Mead

University of Virginia - Darden School of Business

Mallory Combemale

University of Virginia - Darden School of Business

Lauren Purnell

University of Virginia - Darden School of Business

Abstract

Annalisa McGann, chair of London's prestigious Clarence Hall University, together with the university's board, must make a decision about whether to return a large monetary donation from the Natour Charitable Foundation, which was founded and run by a recent graduate who was also the son of the leader of a corrupt, authoritarian regime in an oil-rich region. Almost two-thirds of the money had already been invested in an innovative leukemia drug that could significantly increase patients' chances of survival; the remainder had been earmarked for an endowment fund for low-income students. Each course of action—keeping the money, giving back the entire sum, or returning the unspent money—had complex consequences, particularly in the current environment in which all British universities were suffering financially and there was nationwide student unrest over rising university costs. The British press, by uncovering the connection between Natour and Clarence Hall, had forced the administration's hand, and McGann and the board needed to make a quick decision after considering a number of complicating factors.

Excerpt

UVA-E-0382

Rev. Mar. 14, 2013

CLARENCE HALL UNIVERSITY AND THE DONATION

Annalisa McGann, chair of London's prestigious Clarence Hall University, sat at her desk and pondered the familiar English adage, “a bad penny always turns up.” Two years earlier, in 2009, Clarence Hall had accepted a pledged donation of a total of (British pounds) GBP8 million (equivalent to [U.S. dollars] USD13 million) from the Natour Charitable Foundation. The foundation's chairman and founder was Ibn Jarrah Natour, a 2008 Clarence Hall doctoral program graduate and the son of General Natour, the leader of a corrupt, authoritarian regime in an oil-rich region. Ibn Jarrah had recently issued an outspoken defense of his father's brutal crushing of a democratic uprising in an incendiary speech claiming that attempts to oppose his father's authority would result in the streets' turning to “rivers of blood.”

Within the past week, the British press had managed to uncover the financial dealings between Clarence Hall and the Natour family, and the university now faced a public relations disaster over its 2009 decision to accept the funds and a quandary over what to do with them. Of the initial sum, GBP5 million (USD8 million) had already been invested in research into a new leukemia drug that could significantly increase patients' chances of survival. The remainder—GBP3 million (USD5 million)—was pledged to start an endowment fund for low-income students for the following academic year.

As she prepared for an emergency meeting with the Clarence Hall University board, McGann had to sort through the complexities of the situation in which the school now found itself and come up with a proposed course of action. Returning the money to the Natour foundation was a possibility, but that option presented its own complications. She sighed and reached for her cup of tea.

. . .

Keywords: Business ethics, ethics, ethical situations, university administration, Great Britain, leadership, stakeholder management, public relations, nonprofits, Middle East, strategy, crisis management

Suggested Citation

Parmar, Bidhan L. and Mead, Jenny and Combemale, Mallory and Purnell, Lauren, Clarence Hall University and the Donation. Darden Case No. UVA-E-0382. Available at SSRN: https://ssrn.com/abstract=2974181

Bidhan L. Parmar (Contact Author)

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

Jenny Mead

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

Mallory Combemale

University of Virginia - Darden School of Business

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

Lauren Purnell

University of Virginia - Darden School of Business

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

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