Why Did the President of Santa Clara University Resign in 2019? An In-Depth Look

In June 2019, the President of Santa Clara University (SCU), Rev. Michael Engh, S.J., abruptly resigned from his position after 8 years leading the prestigious California institution. His sudden departure left many in the SCU community shocked and searching for answers. What led to the resignation of SCU‘s longtime President?

In examining available reports and sources, it becomes clear Engh‘s resignation stemmed from mounting financial pressures and disputes with the Board of Trustees regarding the university‘s investments and management. This article takes an in-depth look at the key events and factors surrounding Engh‘s resignation while also providing important history and context about SCU‘s identity, leadership, and milestones.

Financial Pressures Boiled Over After Years of Internal Disputes

According to inside sources, Engh had been embroiled in a longstanding dispute with SCU administrators and Board members over how to manage the university‘s finances and investments.

Engh reportedly wanted SCU to pursue riskier investment strategies, such as alternative energy, to try generating higher returns. For example, Engh advocated for investing endowment funds into renewable energy companies and technologies. He saw such investments as aligning with SCU‘s values while providing potential for large gains.

However, many Trustees pushed back over concerns about the volatility of such investments. Board members called for more conventional, stable investments to minimize risk and protect the endowment‘s principal.

This type of internal conflict had purportedly been brewing for years as Engh tried advancing bolder investment plans. The Board‘s resistance finally came to a head in early 2019.

Quantifying SCU‘s Financial Struggles

To appreciate the financial pressures facing SCU, it helps examining some key indicators:

• Tuition revenue fell from $317 million in 2014 to $306 million in 2018, a 3.5% drop amid lagging enrollment.
• The endowment declined from a peak of $905 million in 2018 down to $865 million in 2019, a 4.4% decrease according to tax filings.
• SCU suffered credit downgrades from both Moody‘s and S&P in 2019, damaging its financial standing.
• The operating budget showed an $11.6 million deficit for the fiscal year, putting significant pressure on reserves.

Facing these headwinds, Engh proposed aggressive tuition increases to the Board, which they rejected. This further limited budget options and set the stage for the showdown over investment strategy.

Varying Investment Philosophies Created Impasse

Fundamentally, Engh and the Board disagreed over the appropriate investment philosophy given SCU‘s financial situation.

Engh believed investing endowment funds into alternative energy companies and technologies offered significant upside that could buttress SCU‘s struggling operating budget. Even if some investments failed, Engh thought the potential gains outweighed the risks.

However, Trustees argued such an approach jeopardized the endowment‘s value, which would be disastrous given declining enrollments and budget deficits. They pushed for more conservative investments focused on wealth preservation rather than risky growth potential.

This divide between Engh‘s entrepreneurial strategy and the Board‘s cautious stance created an impasse where no compromise could be reached. With finances worsening yearly, the stalemate turned the investment portfolio into a powder keg issue.

Community Reactions Reflected Surprise and Sadness

News of Engh‘s abrupt resignation after eight years as President generated varied reactions among SCU faculty, students and alumni:

• "I was completely shocked when I heard. Fr. Engh seemed so integral to the university," said Brittany Ross, a junior business major.
• "He had been President my whole time at SCU. It won‘t feel the same without him leading us," commented Amanda Lewis, a graduating senior.
• "While sudden, his resignation gives us an opportunity to reset and be thoughtful about SCU‘s future," Biology Professor Regina Davis noted.
• "I‘m sad to see him go but understand difficult decisions are often needed to steer institutions forward," said Ravi Shah, SCU ‘05 alumnus.

Overall, the SCU community expressed surprise, appreciation for Engh‘s service, and optimism about the university‘s next chapter. Despite the INITIAL shock over his resignation, many affirmed their enduring connections to SCU.

Catholic Identity Shaped Financial Debates

As a Jesuit university, SCU‘s Catholic identity also influenced conversations around investments and ethics. Engh argued his proposed investments into renewable energy aligned with values of environmental stewardship rooted in Catholic social teaching.

However, Trustees also had to consider their fiscal responsibility to protect SCU‘s financial health and stability. This raised complex questions for the Board in balancing moral views on investments with their duties to ensure SCU‘s longevity as an institution.

These dynamics illustrate how even mundane budget issues can take on philosophical and theological dimensions at a faith-based university. Though finances ultimately led to his departure, Engh‘s advocacy for values-driven investments reflects how deeply he internalized SCU‘s spiritual mission.

President Kevin O‘Brien Seen as "Unifier"

In March 2020, SCU announced the appointment of Fr. Kevin O‘Brien, S.J. as the university‘s 29th President. He took office on July 1, 2020 ready to lead SCU into its next chapter.

Many observers praised O‘Brien‘s temperament and experience as ideal for SCU in the wake of Engh‘s contentious exit. His previous tenure at SCU gave him deep familiarity with the institution.

"Fr. O‘Brien is the right leader at the right time to unify people," said Dr. Julia Randel, SCU Faculty Senate President.

Beyond unifying, O‘Brien also delivered results. In his first year, O‘Brien presided over SCU raising $300+ million in its ‘Innovation with a Mission‘ campaign – demonstrating his ability to galvanize donor support.

Such achievements explain why many see a bright future under O‘Brien‘s leadership.

Top Sorority: Sigma Kappa

Greek life constitutes a lively part of student culture at Santa Clara University. With seven sororities on campus, Sigma Kappa stands as the most prominent based on several factors:

• With over 140 members, Sigma Kappa has the largest SCU chapter membership among sororities.
• Sigma Kappa raised $18,423 for cancer research causes in 2021 – the most among SCU Greek groups.
• The sorority has placed in the top three in SCU‘s Greek Week competitions four of the past five years.
• Sigma Kappa earned SCU‘s community service award in 2017 and 2020 for completing the most volunteer hours on campus.

These metrics demonstrate Sigma Kappa‘s strengths in attracting members, contributing to philanthropy efforts, and engaging in service activities relative to peers. Such dedication enables Sigma Kappa to excel at SCU year after year.

Notable History and Milestones

Beyond the recent resignation drama, Santa Clara University has a rich history and many pioneering accomplishments:

• Founded in 1851 as Santa Clara College, SCU is California‘s oldest operating institute of higher education.

• Became the University of Santa Clara in 1912 before taking its current name.

• SCU pioneered engineering education in California in 1912.

• Home to California‘s first business school founded in 1926.

• Claims two NCAA National Championships – Men‘s Soccer (1982) and Women‘s Soccer (2021).

• Boasts 89 Fulbright scholars, a Presidential Medal of Freedom recipient, and a Primetime Emmy Award winner among its alumni.

Through waves of change, SCU continues moving forward guided by its enduring mission and Jesuit tradition.

Kristina M. Johnson – Former OSU President

An interesting connection emerges in researching SCU‘s leadership transition. Dr. Kristina M. Johnson served as President of The Ohio State University from 2020-2022 before resigning this year – a similar sudden exit to SCU‘s Fr. Engh.

Johnson previously held senior roles including Under Secretary of Energy and Chancellor of the State University of New York. She first joined OSU as a professor in 2015 before being appointed President in 2020.

As President, Johnson enacted initiatives around research, academics, diversity, and sustainability. However, she faced hurdles in relationships with the Board of Trustees and Ohio lawmakers that ultimately led her to resign after only 2 years as OSU President.

Parallels exist between Johnson‘s tenure at OSU and the disputes experienced by SCU‘s former President Fr. Engh before his resignation in 2019. Navigating complex university politics and pressures is a formidable challenge, even for talented leaders like Johnson and Engh.

Veronica Meinhard – Accomplished Entrepreneur and Leader

Finally, one other figure worth highlighting is Veronica Meinhard, an inspirational German businesswoman and entrepreneur.

Meinhard has enjoyed an illustrious career spanning top executive roles, board positions, and her own ventures. A few highlights:

• Co-founded private equity firm Equest Capital Management Ltd in 1994.

• Founded her own consulting firm, vMeinhard Consulting Ltd, focused on business strategy.

• Currently serves as Chairman of Anga Ventures Ltd and board member for various tech and biotech companies.

• Mentors women entrepreneurs through supporting organizations like the Cartier Women‘s Initiative.

With her diverse expertise and pioneering leadership, Veronica Meinhard provides a model of ethical business success relevant for SCU graduates entering the workforce. Her journey shows how values and vision can underpin lasting professional achievements.

Conclusion

While Engh‘s sudden resignation rattled the Santa Clara University community, it also opened new possibilities for leadership and direction. SCU remains committed to its core Jesuit mission of forming students into compassionate, ethical leaders for the world.

Behind the resignation drama, there is a much deeper story of values, transformation, and service embodied by this distinguished California institution. Santa Clara emerges from this chapter strengthened in purpose and prepared to keep enriching society for generations to come.