Colleges question ethics of keeping `walls of shame'

Namesake: Halls named after their wealthy benefactors are embarrassments when the donors land in prison.

August 06, 2005|By BLOOMBERG NEWS

Seton Hall University senior Sheena Collum wonders why students at a Catholic institution that is named after a saint are studying business ethics in a building named after a convicted felon.

The existence of Kozlowski Hall troubled students and faculty at the school of 10,000 in South Orange, N.J., even before donor L. Dennis Kozlowski was convicted in June of grand larceny. The former Tyco International Ltd. chief executive officer, a 1968 Seton Hall graduate, could face as much as 30 years in prison when he is sentenced this year for looting the company.

"Seton Hall puts a great deal of emphasis on ethics in society, and I don't think Mr. Kozlowski is an example to follow," says Collum, 21, the student government president. "It bothers me to keep his name on one of our buildings."

At one point, the school - named for Elizabeth Ann Seton, the first U.S.-born saint - actually had three buildings bearing the names of indicted or convicted felons.

And the school is not alone. There's also the Rigas Family Theater at St. Bonaventure University in New York state, named after the convicted founder of Adelphia Communications Corp. Harvard, Brown and the University of Michigan all have buildings named after A. Alfred Taubman, the former Sotheby's Holdings Inc. chairman who went to prison after being convicted of illegal price fixing. And the University of Missouri has an endowed chair in business named after former Enron Corp. Chairman Kenneth L. Lay.

Diane Swanson, chairwoman of the business ethics education initiative at Kansas State University, says schools and donors should agree that if a benefactor faces criminal charges, his name will be taken down and not restored until he is cleared. She says this would force schools to think harder about naming arrangements.

"It would also signal to the corporate world that business reputations cannot simply be bought," says Swanson.

Harvard, Brown and the University of Michigan all decided against removing Taubman's name from buildings he donated. He was sentenced to a year in prison in April 2002 on charges of conspiring to fix fees paid by sellers of art and antiques.

Kozlowski, 58, who gave Seton Hall $3 million toward the building, was found guilty by a New York jury on June 17 of stealing more than $150 million and selling inflated shares in Bermuda-based Tyco, the world's biggest maker of electronic connectors, industrial valves and security systems. Kozlowski was indicted in September 2002.

His lawyer, Stephen Kaufman, said last month that he would appeal the verdict. Kaufman didn't return four phone calls seeking comment.

Seton Hall spokesman Thomas White says the board of regents won't publicly discuss the naming issue until its next scheduled meeting Sept. 23.

At one point, the school also had a gym named after convicted money launderer Robert E. Brennan and a library named for Frank Walsh Jr., a former Tyco board member who pleaded guilty to securities fraud in 2002. The board of regents voted in 2002 to remove Brennan's name.

"We were really getting tired of being called the `walls of shame,'" says communications Professor Robert Allen. "Not only should a Catholic university be as ethically oriented and morally sensitive as a secular university, it should be more so."

Allen says he spent four years urging the administration to remove Brennan's name from the recreation center donated by the penny-stock promoter. Brennan, a 1965 Seton Hall alumnus, served on the university's board of regents from 1984 to 1987.

Brennan founded First Jersey Securities Inc. He is serving a nine-year prison term for fraud and money laundering and was sentenced to three additional years in June 2003 for contempt of court after violating a judge's order freezing his assets.

Kozlowski's case came to symbolize corporate greed and corruption, with tales of lavish company spending, including a $2 million birthday party for his wife in Sardinia and a $6,000 shower curtain for his New York apartment.

Kozlowski Hall opened in 1997 and houses the Stillman School of Business and the College of Education and Human Services, along with an auditorium that seats 390, where the Tyco chief delivered a lecture in 2001 on the importance of integrity.

Seton Hall has no plans to remove former Tyco board member Walsh's name from the library, spokesman White says.

Walsh resigned as chairman of Seton Hall's board of regents in December 2002, the same month he agreed to pay $22.5 million to settle criminal and civil charges in connection with Tyco's acquisition of CIT Group Inc., a New York-based financial services company.

Walsh remained co-chairman of the school's $150 million capital fundraising campaign before stepping down for personal reasons last year.

Before he resigned, a March 2004 editorial in the campus newspaper, the Setonian, criticized the school, where ethics instruction is required for all students.

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