Wall Street titans help to fuel Ivy League donor revolt
- Billionaire Marc Rowan has been in touch with what one finance executive quipped was "half of Wall Street" about halting donations to some of the country's most prestigious universities.
- Angry donors are using Zoom calls and text chains to vent frustrations with how the schools have responded to the Israel-Hamas war.
Billionaire Marc Rowan has been in touch with what one finance executive quipped was "half of Wall Street" about halting donations to some of the country's most prestigious universities, to protest the schools' responses to the Israel-Hamas war.
The CEO of private equity giant Apollo Global Management belongs to a growing group of Wall Street executives speaking privately with fellow financiers about how to use their influence as major donors to pressure schools into making leadership changes.
Rowan took part in a Zoom call Oct. 23 with dozens of wealthy donors to other Ivy League schools, including Yale University and Harvard University, according to those familiar with the call. One of the things they discussed was pausing their financial support for the schools, these people explained.
At least 400 Penn alumni and donors joined a recent call hosted by former class presidents and several speakers said they were frustrated with the university's current leadership, according to a person familiar. Rowan was one of the final speakers on the call, where he raised his own issues about the school, this person explained.
Beyond the calls with donors and alumni, Rowan and other finance executives critical of the universities have been in contact through text messages about their concerns with the schools. One of the people on these text message chains with Rowan is Bill Ackman, CEO of hedge fund Pershing Square, according to a person briefed on the matter.
The individuals were granted anonymity in order to speak freely about private conversations.
Rowan and Ackman are not alone. Investors David Magerman and Leon Cooperman have also said they plan to stop donating to their preferred universities to protest how the schools have responded to the war.
A spokesman for Ackman said the Pershing Square CEO declined to comment. Rowan did not return requests for comment. A spokesperson for Apollo did not respond, either.
Since co-founding Apollo Global over 30 years ago, Rowan has built relationships with business and political leaders, making him a key influential voice encouraging wealthy donors to withhold donations to schools that depend in part on these contributions to operate.
Rowan's 2018 gift of $50 million to Penn's Wharton School was considered the largest donation the business school had ever received. Rowan currently chairs the Wharton board of advisors.
"The funders are a critical constituency of the governance structure, and if they see a failure of management oversight, then they'll demand management accountability, if not a change of command," Jeffrey Sonnenfeld, a senior associate dean at the Yale School of Management, told CNBC. Sonnenfeld is currently keeping a list of companies that have publicly condemned Hamas' attacks on Israel.
Already, there are signs that Rowan's efforts are having an impact.
On Thursday longtime investor Steve Eisman said he had asked Penn to remove his family's name from a scholarship after he heard Rowan criticizing the school in an Oct. 12 interview on CNBC.
"Your interview with Marc Rowan woke me up a bit," "The Big Short" investor told CNBC's Squawk Box.
"I do not want my family's name associated with the University of Pennsylvania, ever," Eisman said he told officials at his alma mater.
Specifically, Rowan says he is frustrated by Penn's response to an event held on campus in September, two weeks before Hamas launched a deadly surprise attack on Israel that killed at least 1,400 people.
The Palestine Writes Literature Festival featured several speakers who had made antisemitic remarks in the past.
But it's not the festival itself that Rowan says he is angry about. It's the fact that Penn did not publicly condemn the festival, including in the days following the Hamas attacks.
"That condemnation should not be so hard. Unfortunately, if you lack moral courage, it is hard," Rowan told CNBC Oct.12, during the interview that Eisman watched. Rowan has called on fellow Penn donors and alumni to close their checkbooks until the university's president, Elizabeth Magill, and the institution's chairman, Scott Bok, both resign.
Magill and Bok have not resigned. Instead, Penn's president has since announced a university wide plan to combat antisemitism. A key part of this is a new task force on antisemitism, which will hold its first meetings later this month. Penn's leaders also condemned Hamas' attacks on Israel days after Rowan spoke.
Rowan's calls to halt donations to Penn have even reached Washington, where Senate Minority Leader Mitch McConnell, R-Ky., praised Rowan without naming him Tuesday, during a speech on the Senate floor.
"At Penn, one alumnus' call to boycott the school has spread like wildfire, precipitating a crisis that by one account could put a billion-dollar hole in the University's books," said McConnell.