A Freep article came out this morning alleging conflict of interest by the UM endowment fund.
While I am 100% in favor of open dialogue, when an article makes obviously misleading statements, we should hold them responsible to this same level of journalistic responsibility that they are attempting to hold the university to.
The article heading and first paragraph (what most people read and remember) indicates that:
University of Michigan alumnus Donald C. Graham helped pay for the university's football team trip to France. His contribution came after U-M invested $102 million in his son's private equity funds.
Ok, that definitely sounds like quid pro quo and that the University is likely making poor choices.
However if you read further it becomes less clear:
Graham and his family foundation have donated more than $60 million to Michigan, including paying for half of the estimated $800,000 cost of the Wolverines' trip to France last spring, organized by coach Jim Harbaugh.
While it may be true that the endowment fund has invested $102 million in either Inverness Graham or Graham Partners, this article does not appear to have asked, or care, frankly, whether the endowment fund actually did any due diligence. These are by all accounts solid investment vehicles and is the university really supposed to overlook a dedicated and generous donor because of the appearance of conflict of interest? This author clearly has no understanding of business. You actually assess a value to partnerships, working with people and groups that you trust and that have a vested interest in you and yours. It is much less likely that Graham, a donor of $60 million to the university, is out to swindle the university, than some OSU alumni who likewise runs a private equity firm.
If you think Graham got the better end of this stick in giving $60 million to be able to invest $102 million, that's sad.