The Granite Tower
FEATURECOVER STORY
Courted By Corporations—The Two Faces of University Corporatization
Kim Seung Hyun, Lee Jae Hee  |  shine950@korea.ac.kr, jaehee297@korea.ac.kr
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승인 2017.04.03  00:34:39
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Take a stroll around the Korea University (KU) campus. Chances are, one might come across a cluster of students railing against the exorbitantly high tuition fee of KU; it is even easier to stumble across a Burger King, Café Bene or other independent enterprises. Last year, one could even spot promotional posters plastered all over the campus explaining why Future (Crimson) College deserves to see the light of day. These sights point to the emerging shadow of corporatization that is engulfing modern universities. Is corporatization a tantalizingly attractive opportunity that best prepares universities for the Fourth Industrial Wave, or a beast that threatens to pervert the very essence of higher education?
 
“Universities are too important to just let them submit to the petty order of the market,” Jennifer Washburn, the author of University Inc.—The Corporate Corruption of Higher Education (2011) states. Washburn might have had the right idea when she issued the ominous warning, as this is exactly the kind of situation facing universities worldwide. The trend of corporatization has been steadily gaining momentum as an increasing number of universities are pursuing revenue like never before. Within Korea, this is epitomized by projects such as Ewha Womans University’s (EWU) Future Life University and KU’s Future (Crimson) College, despite what the administration of either school argues. 
 
Many students are quick to point out that the recent movements of Korean universities, starting from EWU’s Future Life University and Seoul National University’s (SNU) plans to develop a new campus in Siheung are, for all intents and purposes, vitiating the essential quality of universities. The student bodies question whether the ambitious but lucrative plans put forth by countless universities actually contribute to their academic performances. On the other hand, some people claim that the seemingly unnecessary projects spearheaded by university administrations are integral to raising sufficient finances to fund better in-campus facilities and lectures.
 
The proponents of these diametrically opposed contentions all have the same goal in their crosshairs; a promising future for their universities. Conflict between the two factions is an inevitable pain that universities must go through in order to head in a progressive direction, but the conflicting factions’ constant failure to find middle ground poses a severe problem going forward. If they are unable to reconcile, the altercations between the student body and the university administration are bound to escalate to an uncontrollable degree, as hinted at during last year’s Siheung Campus and EWU debacles. Now is the time to evaluate the arguments of each side of the university corporatization debate and see whether they can reach a reasonable compromise.
   
▲ Independent enterprises in KU. Photographed by Kim Seung Hyun.
 
The New Corporate Model of Universities
 
It is undeniable that universities themselves have hosted for-profit businesses in the past— businesses that continue to exist to this day; KU’s wine and bread, Yonsei University (YU)’s milk, SNU’s chocolate, and many souvenir businesses are all unabashedly aimed at maximizing profit. The Konkuk University foundation even runs its own golf course. The sheer scale and scope of corporatization nowadays that includes independent enterprises, the creation of entire colleges, and direct meddling with tuition fees, however, puts such past businesses to shame.
 
Many will agree that the most conspicuous form of university corporatization is the presence of independent enterprises on campus. The sight of large retail chains like Burger King, Starbucks, or CU convenience stores running amok across university campuses is no longer a rarity. In a most unprecedented and audacious move, Sogang University (SU) even allowed Homeplus, a large supermarket, to set root in its campus. Unsurprisingly, popular opinion has been somewhat split over this matter. Some argue that such in-campus independent enterprises contribute to students’ well-being, while others insist that they have been nothing but a blight on universities, a harbinger of consumerism and corporate interference.
 
Increasing college tuition fees also represents a form of university corporatization. During the ten years from 2001 to 2010, one could easily notice a sharp hike in tuition fee rates. According to a report published by the Ministry of Education, compared to 2001, the average university tuition fee in 2010 rose by 82.7 percent in national universities, and by 57.1 percent in private universities. The fact that the cumulative inflation rate during those years was only 31.5 percent throws into sharp relief just how much tuition fees have risen over the years. Once again, while university administrations say that this is a matter of necessity, given the high costs that newer and better university facilities and lectures entail, most students have been vehemently opposed to it.
 
The restructuring process of many universities, during which majors are combined or separated, has widely been acknowledged as part of university corporatization in the sense that restructuring strengthens the ties between universities and corporations. A common criticism that restructuring processes receive is that they seem to focus too much on increasing the number of so-called money-making departments such as Business Administration, treating students more as potential employees than actual students. However, apologists for these restructuring processes argue that universities have to satisfy the needs of the community they inhabit, which is only possible when universities pay close attention to the kind of talents corporations demand.
 
Another emerging trend in university corporatization pertains to the standing of non-regular faculty members. University administrations seem to be stubbornly refusing to allow non-regular employees into the fold as regular employees, presumably since regular employees demand higher wages. For instance, the YU administration “merely changed the names of non-regular and regular employees to operators and managers to give the appearance of a deeper change while keeping everything the same,” according to the Korean University Worker’s Union. This issue has been at the center of vociferous debates similar to those surrounding higher tuition fees.
   
▲ A comic strip satirizing university corporatization. Provided by kmib.co.kr.
 
The Why in University Corporatization
 
Although university corporatization has been subject to a staggering amount of criticism, more and more university administrations are adopting the corporate model every day. According to these administrations, a gratuitous amount of resentment has been heaped onto something that is backed by good intentions and can ultimately produce much good for the university community. “It is baffling why some label projects such as Future (Crimson) College as corporate sellouts when their emphasis on enriching higher education dwarfs that on turning out a profit,” Professor Byun Kiyong (Education) bemoaned.  
 
Initially, administrations argue that critics grossly underestimate the importance of monetary provision, which is only possible through raising tuition fees and creating non-regular positions. Not only does continuing inflation make raising tuition fees inevitable, but the gradually rising standards of university facilities and lectures also necessitate such changes, along with decreases in faculty wages. Simply put, KU students would not have been able to study in the resplendent reading rooms beneath the Central Plaza and in the Centennial Memorial SAMSUNG Hall without tuition fee hikes. To university administrations, tuition fees hikes are a necessary evil for the constructive development of the university.
 
Some claim that discussions concerning tuition fees have no place alongside those related to university corporatization. Professor Byun, for one, perceives higher tuition fees as an inevitability resulting from the growth of private universities. “When only a small percentage of the Korean population received higher education, it was possible for the government to cover a large portion of the costs incurred by universities,” Professor Byun stated. “Now, more than 50 percent of all Koreans have an undergraduate degree, which makes it necessary for students, who reap the most benefits of university education, to share the burden of paying for their education with the government,” he concluded.  
 
University administrations also claim that arguments against independent enterprises do not hold water. Contrary to popular belief, independent enterprises do not yield much revenue, which comprises only a small portion of the total revenue of universities. As such, a strong case can be made for the argument that independent enterprises serve the convenience of students more than they do the administration’s interests. It is likely that fast-food branches like Burger King, convenience stores, and cafes have largely improved the quality of life students enjoy on campus, and that most students would choose to enroll in a school with independent enterprises in it rather than one without them.
 
In fact, according to the Korea University Weekly, KU students primarily opposed the plan to decrease the number of independent enterprises for consumer cooperatives mostly out of fear for a decrease in quality products. “Making judgments based on one’s sentiment toward independent enterprises themselves misses the point,” Professor Byun said. “Rather, one should consider how the profits from independent enterprises are used and how the presence of independent enterprises benefits or detracts from students’ lives when deciding whether to host them or not,” he elaborated.
 
Most significantly, university corporatization allows universities to better realize their social responsibility by cultivating the kind of students that corporations, and by extension society, desire. Although KU’s Future (Crimson) College plans and other similar projects helmed by universities have been labeled as nothing more than cash grabs in popular media, the KU administration insists that such projects are a means to prepare students for the coming future, namely the Fourth Industrial Wave. By encouraging creativity, innovation and startups, these ventures into the practical and away from the theoretical are seen as necessary steps toward nurturing intellectuals in action instead of the armchair critics of old.
   
▲ Centennial Memorial SAMSUNG Hall. Provided by korea.ac.kr
 
 
Professor Byun stressed the importance of recognizing that universities, like societies, are subject to change. “The duty universities must fulfill has expanded over the years to include not only the production and reproduction of knowledge, but also carrying out philanthropic research, altruistic projects and the like,” he explained. Expounding upon his comments, Professor Byun stated that the growing perception of universities as a social institution has facilitated the rise of university corporatization and strengthened universities’ ties with corporations. “Universities are a part of society now more than ever,” he added.
 
Arguably the most contentious part of university corporatization thus far has been in the way it is executed, rather than its specific content. As portrayed by the popular media, EWU, KU, SNU all went through their growing pains mainly due to the dogmatism of the university administration. However, the harsh reality is that such uncommunicative behavior is also sighted in students and student bodies. Students have sometimes been criticized for unconditionally opposing any project introduced by the administration, painted by some media outlets as unreasonably resistant to change. 
   
▲ SNU posters criticizing the administration. Photographed by Kim Ji Won.
 
The Ivory Tower of Truth?
 
Most student bodies, on the other hand, have an entirely different perception of university corporatization. As evidenced by the aforementioned struggle against the Future Life College in EWU, the fight to get rid of the Siheung Campus plans in SNU and KU’s own protests condemning the Future (Crimson) College plans, corporatization is not seen in a very positive light among students. Even abroad, universities have faced similar incidents. In 2013, students from the University of Sussex engaged in a large scale protest against the university’s decision to privatize some of its services, and even as recently as 2016, students from the University of Chicago fought against the university administration for cutting undue costs such as the worker fee.
 
The reason most often cited when asked why students oppose university corporatization seems to be that it obfuscates the essence of universities, namely the academic pursuit of truth. Within those words lies the assumption that academia should be something independent from profit-making, something that is sought after regardless of whether it is profitable or not. After all, arguably the first historically documented university, the Academy of Plato, did not charge fees for enrollment; teaching at the Academy was not a job, but a responsibility. When universities become fixated on maximizing profits, argue students ranging from KU to the University of Washington, the education provided to them inevitably deteriorates in quality.
 
“University corporatization deprives students of their most basic educational rights,” SNU Occupation Committee member Lee Si Hun noted. “For instance, SNU’s plan to move hundreds of students to the Siheung Campus would undermine students’ right to quality lectures, as instructors would be exhausted from having to needlessly move across two campuses,” he added. According to him, the proper production and dissemination of knowledge to students is a social responsibility that universities must shoulder. In Lee’s own words, “The most fundamental task of universities is to provide the public with accessible knowledge, but corporatization, by subjecting universities to the burden of profit making, makes them shirk their most basic duty.”
   
▲ The Main Hall under occupation. Photographed by Kim Seung Hyun.
 
Another point of disagreement between the school administration and the student body concerning university corporatization revolves around the change in the decision-making structure that it entails. Ardent critics of corporatization say that corporations are usually bureaucratic for reasons of efficiency, which means that the most influential decisions are made not through a democratic process such as a popular vote, but via the discretion of the chief managers. As universities gradually transition into corporations, they identify a similar tendency. The management of the university is rather reluctant to communicate with the student body or the majority of the faculty when it comes to making important decisions, they claim.
 
This trend was pointedly exemplified when the Siheung Campus plans in SNU were unilaterally announced to students only after it had been carefully created and approved by the school administration, demonstrating how university corporatization begets a non-democratic decision making structure. In the case of YU, the school administration notoriously increased students’ tuition fee to cover a budget deficit, which proceeded without the administration once consulting YU’s student body.
 
University corporatization is also rife with economic problems. According to Statistics Korea (KOSTAT), the average tuition fee for private universities has continued to rise since the 1990s. The wage earned by the faculty, in contrast, has steadily decreased. Such profiteering on the part of universities naturally places much strain on the lives of students and faculty members, sometimes in unexpected ways. “The number of shuttles circulating around campus is set to decrease because of the Siheung Campus project, which forced SNU to tighten its budget,” Lee pointed out. “By indiscriminately cutting costs, the campus is sentencing not only those whose wages are slashed, but also the students who frequently use shuttle services, to discomfort,” he added.
 
The encroachment of independent enterprises onto university campuses presents a similar issue. “Independent enterprises are prone to drive prices up within campus,” Lee criticized, remarking that, “In the end, students have to bear the brunt of the burden that comes with higher prices.” Although numerous universities have defended the presence of independent enterprises in campus, claiming that their profits are necessary to fund scholarships and grants, it is uncertain whether such an incremental addition to the university budget can make enough of a difference. In the case of Konkuk University, the revenue from independent enterprises made up less than one percent of the university’s total revenue in 2009.
 
While it is often defined only in relation to profit-making projects launched by universities, some have embraced a broader definition of university corporatization. “University corporatization refers to the general willingness of universities to use the school in a way that yields profit,” Lee declared. “Any action that treats students as customers or prioritizes corporate interests over students’ educational rights is an act of corporatization,” he said. In this vein, Lee also advised against the commercialization of university research, or selling research methods and results obtained in universities to corporations, lest universities focus more on selling completed research than properly developing it.
   
▲ The Main Hall of SNU under occupation. Photographed by Kim Ji Won.
 
The Last Refuge for Corporatization
 
An ingenious means devised to prevent independent enterprises from exploiting students with impunity is the introduction of consumer cooperatives in universities. Consumer cooperatives or Co-ops for short, which have long been used to mitigate the high prices of large corporations and enterprises by charging low prices, are now being introduced in universities nationwide to fulfill a similar function. The coexistence of Co-ops and independent enterprises on campus allows students to enjoy the benefits that come from the latter, including recognizable and thus reliable products, while warding off the threat of inflation.
 
However, even Co-ops are not a perfect solution. While universities are making concerted efforts to curb the proliferation of independent enterprises, Co-ops are disappearing alongside them. In SNU’s case, Lee mentioned that the SNU Co-op is gradually being crowded out, presumably due to the low rental fee that the Co-op pays when compared to independent enterprises. Furthermore, it is uncertain whether some universities will introduce Co-ops at all. In KU, for instance, numerous attempts to establish Co-ops have been shot down due to the aforementioned reasons of convenience and reliability. Nevertheless, setting up Co-ops is an adequate starting point for a more reasonable form of university corporatization.
 
Despite the negative press university research commercialization receives, it is indisputable that this particular brand of commercialization has been greatly beneficial to universities without compromising their academic integrity. One famous example is the strong connection between Silicon Valley developers and Stanford University. During World War II, Stanford alumnus Frederick Terman launched a slew of sponsored research projects in Stanford that drew researchers and students from all over the United States (U.S.) to the university, a movement that eventually blossomed into Silicon Valley. This bond between university and technology companies helped catapult Stanford into the innovation powerhouse that it is today.
 
Even to this day, Stanford University emphasizes applying the knowledge gleaned in classrooms to the real world through startups and corporate ties. As Stanford’s example testifies, research commercialization can bolster a university’s reputation and revenue without having to rely on profits from raising tuition fees, independent enterprises and slashing faculty wages. Still, unless such commercialization is in service of incentivizing researchers and increasing the quality of research conducted at universities instead of maximizing profit, it will easily fall victim to the same criticisms that hound projects such as SNU’s Siheung Campus.
   
▲ Stanford University. Provided by Stanford.edu.
 
Research commercialization also has the added perk of directly contributing to society, unlike other forms of corporatization that mostly benefit the university administration and students. “Our success in translating research results into practice not only accelerates the beneficial aspects of our research, but also has a major positive impact on our region’s economy,” reads the University of Pittsburgh’s rationale for commercializing their research, a sentiment that is echoed by other universities. There is a prevailing sense that universities cannot remain holed up within their ivory towers and exercise a monopoly on knowledge; they have a social responsibility to use such knowledge and make contributions to the community. If research commercialization can accomplish this task and make profits on the side as well, the more the merrier.
 
Unfortunately, in spite of the extensive research commercialization conducted in South Korean universities, the results have been less than stellar. “Balance is key to a desirable form of research commercialization,” Professor Byun emphasized. “The government, the market, and the university are the three tenets on which higher education rests; each should retain their own independence while also granting the wishes of the other parties,” he added. He pointed out that so far, the research commercialization undergone in South Korean universities has been conducive only to corporations’ self interests instead of striking a balance between corporate interests and social needs.
 
   
▲ Shinhan bank funds research commercialization. Provided by news1.kr
 
Communication among students, the administration and the faculty is another virtue often overlooked when discussing any university matter. The specific details of corporatization notwithstanding, a dogmatic and uncommunicative pursuit of either corporatization or corporate independence hinders progress. The Future (Crimson) College plans, for one, were foiled in part due to the overly ambitious content of the plans, but mostly because of the communications gap between the students and the school over the plans had provoked their ire. “It was the pent up rage of students concerning the administration’s secretive and undemocratic attitude that led to the Main Hall occupation,” a document drafted by the Occupation Committee stated.
 
Finding the Middle Road
 
Healthy university corporatization, above all else, requires students’ constant vigilance. “Students must always be wary of corporatization and ready to fight against the administration when necessary,” Lee warned. “Unless the student body keeps the administration in check, universities can proceed with corporate projects that undermine their basic responsibilities,” he elaborated. While being able to recognize the limitations of corporatization is an indispensable attribute, it is as important to acknowledge that corporatization and academia are not mutually exclusive. Some universities, such as the aforementioned Stanford University, have succeeded in riding the line between corporatization and selling out, demonstrating that corporatization is not inherently malevolent.
 

For better or worse, universities are no longer castles in the cloud, separated from the world around them, and critics of corporatization must realize that universities are part of a community and inextricable from the corporations that populate each community. Yet this does not mean that universities should embrace this seemingly unstoppable trend with open arms; universities are not corporations, nor should they be. In the end, student bodies and university administrations should arrive at a middle road, a road that takes the shape of balanced research commercialization, Co-ops, and bilateral communication.  

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