Trusteeship - March/April 2021 - 44

THE 2021 JOHN NASON AWARD WINNERS

(The university, not the foundation, does the fundraising.)
Martell credits the arrival of
O'Neill in 2018 as providing an
impetus for changing the shape
of the board and the way it did
business, including new term
limits. " Cherí was the person who
went out and found those new
directors. It's been an outstanding
opportunity for us, " he said.
A veteran foundation and
advancement leader, O'Neill
came to Colorado State from Ball
State University, her alma mater,
where she was also the foundation president and CEO. " This
board really leaned in to make the
Colorado State University students
change. Not every board wants
to give up power and bring other
people to the table, " she said. " But even when they hired me there
was talk about the need for diversity. "
Now 3 of the 11 directors are women and 2 are persons of color.
Moreover, the board added expertise on both higher education and
board governance as well as another attorney. It also has three ex
officio members from the university (including President McConnell) and two independent audit committee members. It did all
of its own volition before the entire nation faced a groundswell of
calls for equity and social justice that welled up in 2020.
O'Neill said participating in the Association of Governing
Board's Council of Presidents and its Council of Foundation Leaders had provided valuable insights on how to make these changes.
The board took a methodical approach to its transformation. In
year one, it accomplished the following:
Q Designed and conducted a diversity gap analysis;
Q Identified and vetted potential new members to match needs;
Q Revised the bylaws to accommodate more directors;
Q Added committees, created their charters, developed new member orientation, and created a first-ever board evaluation tool.
Then it implemented the changes in year two by:
Q Adding four new directors and one committee member;
Q Creating two new committees (governance and compensation);
Q Establishing the term limits; and
Q Employing a new orientation program and using a self-evaluation tool.
Not only were more diverse directors welcomed to the board,
" but we elected them to positions of importance, " including the
governance committee, said Martell, who becomes past chair this
spring. " We have incorporated them in a very meaningful way. "
44 TRUSTEESHIP MAR. APR. 2021

Simultaneously the board took a new direction in how it discharged its fiduciary responsibilities. For decades it had directed
the investment practices via its investment committee and an
investment consultant. But it perceived a need to provide more
timely oversight of the endowment, act more nimbly, and take
advantage of different kinds of investment opportunities. As
McConnell and O'Neill phrased it, " The board wanted to transform its role from tactical, in-the-weeds manager selection and
oversight to one that was more about setting investment strategy
and policy. " It outsourced the role of chief investment officer and
took a hard look at how much risk it could prudently accept to
improve returns. It created separate pools for the endowment and
for current use with distinct and different investment policies,
asset allocations, and return objectives.
" It was Jim who pushed through the outsourced chief investment officer model. We brought it up at one meeting. Jim said,
'Shouldn't we just do that?' and the board said yes, " said O'Neill. " I
was like, 'Oh, my gosh.' This group really is ready for change. "
That served the foundation well when the pandemic struck and
the university faced uncertainty over whether enrollment would
hold up. Within weeks the foundation recalculated the annual payout to CSU, switching from a year-by-year payout to one based on
a three-year rolling average. At a time of extreme market volatility,
the foundation transferred to the university the second largest
amount in its history.
" When other people think it has to take massive amounts of
time to do a transformation like this, it doesn't. If there's a sense of
urgency and a real will and desire to do it, you can actually make that
change rapidly, " said O'Neill. " That's what we're a case study for. "

PHOTO COURTESY UNIVERSITY OF COLORADO

Trusteeship - March/April 2021

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