Gifts to Wharton fall amid campus tensions after Hamas attack on Israel

Gifts to one of the most prestigious US business schools have fallen since Hamas’s attack on Israel sparked tensions between donors and universities over antisemitism and freedom of speech on campuses.

Erika James, dean of the Wharton School at the University of Pennsylvania, told the Financial Times that contributions from new funders had dropped in recent months, while being offset by extra revenues from tuition and income from the school’s other activities.

She would not give precise figures ahead of the university’s financial year which ends in June, but said: “There has been a dip in donations. In any year, one [income source] will underperform. Now philanthropy is coming back. We weathered the storm.”

She has also launched a fresh round of discussions with donors, stressing Wharton’s commitment to “creating knowledge useful to society” and redoubling courses on conflict management, productive engagement and civil discourse.

The University of Pennsylvania, where Wharton is based, was at the centre of criticism over claims of antisemitism faced by students even ahead of October 7, with concerns raised by some donors about a Palestinian literature festival affiliated with Penn that invited speakers critical of Israel.

The business school, which has a strong reputation in finance, has many wealthy and powerful alumni who built careers in investment banks on Wall Street or in private equity and hedge funds, and have since October 7 threatened to withdraw funding to their alma mater.

Outspoken critics included Marc Rowan of Apollo Global, businessmen Ron Lauder and Jonathon Jacobson, former Utah Republican governor Jon Huntsman and venture capitalist David Magerman.

The Wharton Board of Advisors, an alumni body chaired by Rowan, in December proposed a code of conduct that sought to further regulate speech at Penn. Faculty groups have since pushed back against what they described as inappropriate interference by a small group of wealthy benefactors.

Alumni pressure helped trigger a shake-up leading to the resignation of Scott Bok as chair of the board of trustees, and the departure of Liz Magill as president after she struggled at a congressional hearing in December to muster a clear response when asked whether calling for the genocide of Jews violated the campus codes of conduct.

Claudine Gay, Harvard’s president, has since also resigned following criticism of her performance at the committee, as well as questions about academic plagiarism. Both universities are among those which have been sued for allegedly failing to protect against antisemitism on campus.

In another potential sign of the fallout from October 7, Harvard reported a small drop in undergraduate student applications for the coming academic year. However, demand rose to record levels at the University of Pennsylvania.

James said that existing donors who had already made commitments to Wharton had not stopped providing funding, mirroring the views of a longtime university trustee who told the FT that most existing large funding pledges were multiyear commitments so cash collections in the current year would be unlikely to be affected.

The University of Pennsylvania declined to comment.