Nearing the end of the fall semester of my final year as chancellor, I am struck by the marvelous symmetry of continuity and change, the twin constants that govern the life of this great university.

Last July, as you know, I announced that I would step down as chancellor by the end of June 1997. It has been a wonderful privilege and a high honor to serve as chancellor. But, after seven years, I felt that the moment was right for change ã for me as well as for the institution.

While I made my decision with very mixed emotions, events since then have confirmed my conviction that I could leave with the campus riding a high and rising tide. As you will see by perusing the pages of this annual report to the campus, there is much evidence that this is the case. Let me point to just a few highlights.

The quality of our faculty remains second to none. The National Research Council confirmed the excellence of Berkeley last fall, and over the past year we continued to build on that strength.

But excellence is something we can never be satisfied simply to maintain.

One way to raise the bar of excellence is to recruit the best and brightest young professors. Another is to attract a stream of established scholars. This year's new faculty are outstanding. Joining our ranks are 64 new faculty members, 90 percent of whom were our first choices for faculty appointments.

Thanks to California's economic recovery, we were able to get substantial raises for our employees, and faculty salaries were increased as part of an ambitious three-year plan to restore faculty pay to competitive levels. We have begun to close the gap with comparison institutions, but we will not be satisfied until it is eliminated entirely.

As for our students, the quality just keeps getting better and better. The class of 2000 is the most competitive ever admitted to Cal. They are energetic, inquisitive, hard working and public spirited.

Our student body remains, I am proud to say, among the most diverse in the nation. Maintaining that diversity is crucial if we are to continue to raise the bar of excellence.

Earlier this month, the people of California voted for a major change in course when they approved the California Civil Rights Initiative.

The measure will have a significant affect on this campus and will no doubt require us to alter current policies in some program areas. But it will not change, in any way, our fundamental commitment to diversity. As a public university, we are duty bound to ensure that the benefits of Berkeley accrue to all the people of this state regardless of race, gender, ethnicity or economic status.

Diversity adds vitality to our campus. It brings greater breadth and depth to our teaching, research, and public service, and it better prepares our students for life outside the Ivory Tower.

During the election campaign, there was much debate about the value of affirmative action. And there are legitimate differences of opinion on this subject. But in my mind, there is little to debate about the value of diversity. It is the essence of Cal's excellence.

"To fulfill its mission of uplifting the state to continuously higher levels," observed the historian Frederick Jackson Turner, "the university must serve the time without yielding to it."

To serve the time without yielding to it, we created the Berkeley Pledge to assure that students from diverse backgrounds will have the tools and the training they need to get into Berkeley whatever their economic situation may be.

Alumni and friends are another constant at Cal. They have been exceedingly generous to usãespecially during the past five years. At the start of this school year, we launched the most ambitious fund raising drive in the history of public higher education. We have committed ourselves to raise $1.1 billion by the end of the year 2000. Already, we are nearing the halfway mark toward that goal.

These funds will underwrite important new programs for our faculty and students. For example, 14 distinguished faculty were recently named to our newly established Chancellor's Professorships, one of our Bridge Initiatives specifically designed to enrich faculty resources. Another initiative was to provide $1.6 million last year to help our faculty, including those in the arts and humanities, acquire needed computer hardware and software.

The ability to take advantage of technology that is transforming everything we do is crucial. We are embracing new technologies in our libraries, our classrooms, and our laboratories.

Programs such as these illustrate the importance of private funding and the strength of our commitment to make faculty and students the heart of this capital campaign. People are the most important constant at Cal. That is why, no matter what the political climate, no matter what technological change may bring, and no matter who is lucky enough to next lead this great institution, the University of California, Berkeley will continue to be a great university.

In four years and a few months, we will find ourselves at the turn of the century. Great changes, no doubt, await us. But the continuing underlying strengths of this campus will, I am confidant, enable this community to deal effectively with whatever comes. I am certain that, at the dawn of the new millennium, Berkeley's place at the forefront of higher education will be secure.

Berkeley has been called "the great experiment in diversity." As with all great experiments, we cannot anticipate fully what the outcome will be. We must trust in the wisdom, the good will, and the commitment of those of us who are fortunate to be participants in this great experiment. So I want to thank each of you for all you do for Cal, and thank you for helping make my tenure as chancellor so enjoyable, so rewarding, and so productive.