With federal grants in the crosshairs and scrutiny intensifying around who funds American higher education, college and university advancement teams are being pushed to reexamine how they raise money—and who they accept gifts from.
The U.S. government is stepping up oversight on foreign funding after releasing data showing Qatar, China and “countries involved in activities that threaten America’s national security” gift billions of dollars to U.S. colleges and universities.
Heightened geopolitical tension and regulatory oversight are unfolding against a backdrop of shrinking federal research dollars, leading to budget cuts at many of the country’s most preeminent universities.
Depleted national funding has led colleges to court private donors more aggressively. Some wealthy benefactors, including Bill Gates and Mackenzie Scott, have stepped up with transformative gift-giving.
However, large gifts from private groups or individuals come with heightened public visibility—and potential fallout.
Bard College in New York has initiated an independent investigation into President Leon Botstein’s relationship with disgraced financier Jeffrey Epstein, The New York Times reports. The review began following disclosures that Botstein sought a major donation from Epstein and subsequently formed a friendly connection with him.
Listen more here: Navigating the new age of higher ed philanthropy
Moreover, Florida A&M University’s former president resigned in 2024 after promoting a $237 million donation that later proved invalid.
“Universities—and Rice is no exception—have been rather naive in accepting donations, foreign and domestic,” says Caroline Levander, vice president for Global Strategy at Rice University in Texas. “It’s not just that there are bad actors out there. The whole climate around funding is changing.”
Research faculty are now caught in an enduring tension, she explains. On one hand, they must protect their own reputation and that of their institution. On the other, they must aggressively pursue funding to keep research teams running.
Similarly, institutions want to preserve faculty autonomy in seeking grants, but ultimately, a faculty member’s actions reflect the brand of the institution.
The rise of donor vetting
At many institutions, assessing potential donations has historically focused more on mission alignment than risk. Colleges and universities must now assess donors by their reputation before accepting cash.
Advancement teams risk giving “brand legitimacy to donors” who might not align to the institution, Levander says.
Universities need systems that evaluate funding sources more thoroughly and more quickly. Existing auditing processes—designed primarily to monitor how funding is used after the fact—often move slowly.
If donor vetting operated at the pace of current auditing systems, colleges would risk watching donor interest evaporate, Levander says.
Rice is piloting one emerging solution. The university recently acquired coaches who can gently guide research faculty when evaluating a potential donor. This creates a more responsive vetting process, unrestrained by official bureaucratic oversight that’s involved in auditing funding expenditures.
