If You Ignore Where the Money Comes From, did the $11 Million Make a Difference?

Koch Foundation donation to Ciocca Center remains a debate three years later

An $11 million donation funded the creation of the Ciocca Center for Innovation and Entrepreneurship at Santa Clara in 2019. The center supports a wide variety of programs aimed at "expanding the entrepreneurial mindset," with everything from faculty research grants to mentoring opportunities for students as they develop innovative ways to approach business. Alumna Carlyse Franzia Ciocca ‘77 and her husband, Art Ciocca, donated $7 million, contingent upon an additional $4 million from the Koch Foundation.

Opposition to the acceptance of the Koch Foundation’s donation was swift, as some argued that the Koch family’s political agenda and history of environmental infractions were at odds with the university’s Jesuit values. More than 1000 students, faculty and alumni signed a letter to the incoming president, Father O’Brien, denouncing the donation. Students held demonstrations in a plea not to take the money. Furthermore, the Faculty Senate voted 30-0-2 to request that the administration reject the grant.

However, proponents believed the opportunity to fund programs designed to bolster critical skills for students was too good to pass up.

Still, many faculty members remain concerned about the standard set by accepting this donation. Hersh Shefrin, a professor in the finance department, who served on the Ciocca-Koch Gift Oversight & Accountability Committee, explains the environmental damage caused by the Kochs’ actions.

“Fifty percent of anthropogenic greenhouse gas emissions have occurred since the Koch Brothers began their campaign,” he said.

Furthermore, they worked to prevent the passage of cap and trade legislation in the 1990s and early 2000s that would have harmed the profitability of their energy industry assets.

“Specifically, the value of their energy company, one of the largest private corporations in the world, would have declined with the imposition of a carbon tax and national cap and trade system,” said Shefrin. “So, for me, the Koch Foundation component of the gift with the Cioccas to the University, was tainted by ‘blood money.’”

Petra Glenn, a member of Fossil Free SCU, also believes the impact of Koch Industries cannot be overlooked.

“Santa Clara uses buzzwords like ‘sustainability’ to attract new students and adhere to our societies' shifting expectations regarding the environment, all while accepting donations from a foundation that exists to spread climate denial in order to profit from the climate crisis,” Glenn said.

The Koch Foundation states that it is “committed to partnering with social entrepreneurs to remove barriers that prevent people from reaching their potential.” As such, Christopher Norris, executive director of the Ciocca Center, asserts that the Koch Foundation and the university are both committed to the positive global impacts of social entrepreneurship. 

“If you talk about the mission of the Koch Foundation, it is to help social entrepreneurs make the world a better place,” Norris said. “So that’s why a gift to a school like Santa Clara is in scope for them. Because that’s pretty much our mission too, right?”

Norris also believes that objections to the Koch Foundation’s donation are often premised on criticisms of Koch Industries, a separate entity. In this way, he holds that those opposed to the foundation’s involvement because of environmental concerns are unfairly conflating two entities that are not directly related.

“There are many different entities here: Charles and David Koch, Koch Industries and then there's the Koch Foundation,” Norris said. “I think that the objection to the Koch Foundation isn't really about the mission of the Koch Foundation as much as it is about the impact of the Koch Industries.”

Glenn believes the semantics of differentiating between Koch Industries and the Koch Foundation is meaningless.

“No foundation can donate enough to erase the harm that was done to acquire their fortune,” said Glenn. “Santa Clara wouldn't need to teach the next generation of climate scientists and activists if the climate crisis didn't exist in the first place, so why would the Koch Foundation's donation make up for the crisis they have helped to perpetuate?”

Glenn feels that accepting the Koch Foundation’s contribution stands in opposition to the university’s key tenets of cura personalis.

“Accepting a donation from the Koch Foundation is in no way ‘competent, conscience or compassionate,’ so how does Santa Clara expect to prepare its students to be?” said Glenn.

The Koch family has supported initiatives that discourage public policy that addresses climate change. As such, many faculty members worried about a tainted donation source. Academic coercion was additionally foundational to their concern, as a large sum of money could put pressure on the university. However, as the years have passed, this issue may be subsiding.

“There is transparency and there is no evidence of the Koch Foundation exerting, or even attempting to influence decisions within the university,” Shefrin said. “I should add that the issues of political influence and transparency are different from the issue of blood money.”

Regardless of the oversight board, Ed Maurer, a professor of engineering, remains concerned that the Koch Foundation may exert some influence over Santa Clara’s usage of funds.

“The oversight committee was set up solely to ensure that the specific limits in the agreement are not violated. This sets an unfortunate trap – as long as the donor does not violate the limited details in the agreement, the committee is obliged to issue a thumbs-up, granting a perception of institutional approval of the funds themselves,” Maurer said.

The consternation regarding the donation may lead to the question of whether Santa Clara should introduce strict purity tests for donors.

Paul Semenza, the dean’s executive professor of engineering management and leadership, believes that implementing a purity test would be impractical, but maintains that Santa Clara should prevent donors from restricting academic freedom.

“I do believe it is important to guard against any interference or bias on the part of donors,” Semenza said. “Once the purpose of a donation is agreed upon, it is the responsibility of the university to ensure that the donors are not able to influence grants, hiring, program design or research.”

Santa Clara found itself in a difficult position at the time of the donation. A struggling Center for Innovation and Entrepreneurship in 2018 required funding from a trusted source, but the funding could not be completed without an additional grant.

Hersh Shefrin contends that Santa Clara did not use its platform as a Jesuit leader in cultivating student empathy and awareness of critical issues.

“I think the university leadership missed a great opportunity to call attention to the damage caused by the Koch Brothers campaign to fight sensible climate policy, and I think it was a mistake,” Shefrin said.

Today, the Ciocca Center is able to fund impactful academic and research projects, develop internship opportunities for students and support the campus’s entrepreneurial ecosystem. The donation, however, remains a point of contention.

“We have a bunch of programs that are only here because of that funding package. If you just ignore where the money came from, did that $11 million make a difference, and is it still making a difference?” said Norris. “I think it’s a pretty resounding yes.”

Santa Clara community members can obtain additional information about the Ciocca Center and donation on the university marketing and communications website.