The president of the University of Minnesota should not be moonlighting for Securian
University of Minnesota President Joan Gabel. Courtesy photo.
The decision by the University Board of Regents last week to approve President Joan Gabel’s $130,000 annual moonlighting arrangement as a member of the Board of Directors of Securian Financial couldn’t be more tone deaf. Tuition is rising, faculty and staff salaries are being squeezed, and the institution is about to ask the Legislature for ever more funding.
Apart from those considerations, the dubious deal is rife with other improprieties. The University does some $1 billion of business with Securian and its affiliates, which exposes both the financial firm and the U to a myriad of conflicts of interest. The regents explicitly recognized that the relationship breeds conflicts in directing Gabel to agree to some type of “conflict management plan.” But that belatedly comes after the fact, equivalent to developing a snow removal plan after a snowstorm.
A supportive regent said that serving on Securian’s board will help improve Gabel’s leadership skills. She ought to enroll in a management training program at the U’s Carlson School of Management. Maybe they would even waive tuition for her.
At a minimum, the conflict plan ought to require Gabel to assiduously track the time she spends on Securian business — including the quarterly day-long meetings — and then subtract that apportioned amount from her University pay. Or, she should contribute her Securian compensation to one or more worthwhile University-related charitable causes.
The Gabel gambit was not the first time the regents have encountered a conflicting interest issue this year and opted to proceed despite those concerns.
This summer, regents appointed one of their own— retired Duluth business executive David McMillan — to serve as chancellor at the U’s branch in his hometown. Despite his absence of academic background, he’s well qualified, but his appointment raised the hackles of some regents and concerned Minnesotans as being rife with conflicts of interest — real or perceived.
Working for Securian while Gabel maintains her day job at the U also sets a bad precedent for other high-level and well-paid public sector personnel. It’s reminiscent of Jesse Ventura dabbling with a professional wrestling enterprise that paid him while he was governor.
The regents were remiss in not grappling harder with Gabel’s arrangement before insouciantly authorizing it by a 9-3 vote.
The Securian scheme raises some obvious questions, and let’s hope Minnesota’s intrepid journalists will get them answered: Who initiated the deal? How did the negotiations proceed? Who knew about it, what did they know, when did they know, and what did they do about it before presenting the deal as a fait accompli?
As head of the institution, Gabel is well-compensated: $1 million annually, including salary, retirement contributions, bonus and other benefits, following a controversial wage boost earlier this year. Although the sum is not outlandish among similarly-situated academic chieftains, it certainly is more than a living wage that hardly needs supplementing with a second job.
The regents did, at least, wrestle with another presidential-related economic issue. It began considering selling off Eastcliff. That’s the century-old 20-room residence overlooking the Mississippi River in St. Paul, which the U owns and furnishes to the president rent-free, adding to the value of Gabel’s compensation package.
But Gabel need not worry about becoming homeless. If the mansion is sold, her compensation from Securian ought to help her find comfortable alternative housing.
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