The [Your Name Here] School of Business
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Adding a new moniker in exchange for a big-time donation has become the norm among B-schools. Out of the Top 30 Business Schools ranked by BusinessWeek, only five—the University of Chicago, Stanford, Harvard, Columbia, and Yale—don't bear secondary names. And for schools aching to move up in the B-school standings, the serious infusion of cash that a naming donation brings can beef up programs, pay for some new professors, and fund expanded recruiting efforts.
In this arena, B-schools are in the mainstream of American business, where selling naming rights for sports arenas and theaters, among other things, has become a major revenue stream. And with spiraling costs and shrinking state support, business schools are increasingly relying more on private donors to fill in the gaps. "Every institution—whether you're at the top or the bottom—is looking to secure funding to enhance its overall initiatives," says Arthur Kraft, chair of the Assn. to Advance Collegiate Schools of Business (AACSB), the B-schools' accrediting board. And naming rights are one of the strongest incentives B-school development directors have to offer.
For most "unnamed" schools, it will probably only be a matter of time before the right big-pocketed donor comes along. Though identifying a specific dollar amount is always a delicate proposition, deans and development directors from the as-yet-unnamed business schools at the University of Connecticut, University of Tennessee, and University of Wisconsin say they would be happy to give up their naming rights for gifts in the neighborhood of $50 million. The dean of Howard University's B-school says a gift of $15 million to $20 million would do the trick. Dean John Thomas of the University at Buffalo says the school is "aggressively seeking a naming gift"—he predicts a donation of $30 million to $50 million in the next three years.
Officials at both Yale and Chicago also say they're open to the idea of naming their business schools after a donor, though benefactors looking to make their mark on an already top-ranked school should expect to tender a top-ranked donation—perhaps $100 million or more. Chicago Dean Edward Snyder says a named gift would bring "clear advantages—a shorthand name and the additional endowment," which could "fuel yet greater momentum for Chicago." Snyder adds that a key consideration in accepting a naming gift is the character and integrity of the donor.
Another, of course, is the gift's size. While Snyder wouldn't speculate on what that size would have to be, "It would be considerably greater than the largest gifts to business schools to date," he says.
How great, exactly? Well, so far, the record for the largest gift is the $105 million Stanford Graduate School of Business received this year from Nike (NKE) founder Philip Knight, most of which will go to the construction of a new campus that will bear his name (see BusinessWeek.com, 8/1/06, "Nike Founder Gives $105M to Stanford"). Previously, the largest gift to a business school was developer Stephen Ross's $100 million gift to the University of Michigan, which announced in 2004 that the B-school would be renamed in Ross's honor (see BusinessWeek.com , 9/9/04, "A $100 Million Thanks for Michigan").
HOW MUCH IS PRICELESS?
Big-pocketed donors with their hearts set on naming Stanford, Harvard, or Columbia business schools might be disappointed, though. All three schools say that naming rights—for their schools, anyway—aren't up for grabs.
Stanford Dean Robert Joss says naming "is just not something I envision at the moment." David Lampe, executive director of marketing and communications at Harvard Business School, says the school's reputation is closely tied to the Harvard name. "This brand equity…is of incalculable value, and we have no intention of abandoning it." Columbia, which declined to comment for this story, has made statements of a similar nature.
But is there really such a thing as a "priceless brand"? Los Angeles-based branding expert Ron Frankel doesn't think so. "When you dangle a billion-dollar check in front of people, they start doing really weird things," he says. "Watch what happens if Bill Gates writes a $5-billion check to Harvard. It would give them fits and starts, but they'd do it."
Slide Show: Just who were Tuck, Fuqua, and Goizueta? Click here to see the faces behind the names of some of the nation's B-schools