By Kara D. Freeman
Over the last decade, enterprise risk management has become an increasingly important priority for business officers in higher education. From physical and financial threats to reputational risks and rising leadership turnover, assessing and managing risk on campus has become a continuous and multifaceted effort.
In the last five years, this job has become more important than ever. Between uncertainty in policy and revenue streams, the COVID-19 pandemic, inflationary pressures, and other economic headwinds, the risks facing our colleges and universities are accumulating.
To take a closer look at the challenges that business officers navigate, the National Association of College and University Business Officers (NACUBO) surveyed more than 600 members on their top concerns this year. We analyzed their responses and compiled the Top 5 Higher Education Business Issues of 2025.1 The list can serve as a roadmap for enterprise risk managers as they evaluate current risks and equip leaders with strategies on how they can strengthen institutional resilience.
While we have no shortage of challenges, it is also essential to acknowledge the opportunities. We are seeing our members strategically shift, where possible, to meet this moment of uncertainty. Chief business officers are working collaboratively across their campuses, and with one another, to develop innovative solutions that balance cost efficiency with strategic investment.
Here are the top five business issues, along with strategies for addressing them:
Managing Unreliable Funding Sources: With the many changes in federal policies since January and the confusion about the Department of Education’s future, it is no surprise this was the most significant issue our members cited. Amid the uncertainty, we are seeing members review their strategic plans, examine the cost of instruction, cut back on expenses where they can (without impacting the mission), and consider sharing services to increase efficiency.
Amplifying the Value of Higher Education: The misperceptions about higher education, from what college really costs (and whether it’s worth it) to how endowments are used, threaten higher education enrollments, persistence, and funding. Collectively, we must promote the true cost of college, showcase the economic value to students who complete degrees, and use data more effectively to make the case for the many benefits that higher education institutions provide to students, communities, and society at large. NACUBO’s “More Is Possible With Higher Education” project has data and graphics to help you get started.
Political and Policy Disruptions: Higher education institutions are dealing with uncertainty in funding from federal programs—like Federal Work-Study and TRIO—which will directly impact students and institutions, and many are navigating state-level funding challenges. Leadership and government relations staff at both public and private institutions should maintain regular communication with federal, state, and local policymakers to ensure they are aware of campus needs and understand how policies affect students.
"Together, through collective action, we can help mitigate risk, thrive amid volatility, and emerge as stronger, more resilient institutions."
Supporting and Maintaining the Workforce: Our people are our biggest asset. As colleges and universities face growing challenges in attracting and retaining staff amid rising salary and benefits costs, it is essential to identify strategies to offer competitive pay, invest in training and professional development, and strengthen employee morale and campus workplace culture.
Meeting Rising Operational Costs: Costs are increasing on everything from deferred maintenance of facilities to cybersecurity and IT infrastructure upgrades, putting pressure on the financial plans and budgets our members create. Institutions can take proactive steps to remain on a path to sustainability and can engage in budget reviews to uncover inefficiencies and identify opportunities for reallocation. Some institutions are also centralizing administrative services to increase efficiency and reduce operational costs.
As we continue to manage and mitigate growing risks, I have been inspired by the resilience and dedication of our members. As one CFO shared, “I have honestly never been more excited to be a CFO. Navigating these issues are of paramount importance, and it takes leaders to calm the waters and focus the organization on the problems at hand.”
Together, through collective action, we can help mitigate risk, thrive amid volatility, and emerge as stronger, more resilient institutions.
https://www.nacubo.org/Research/2025-Top-Business-Issues
