The origins of this ethical dilemma in college admissions have been evident for some time; they just weren’t apparent to everyone. Thanks to a few celebrities and the Entertainment Tonight program, they’ve come to the forefront. For colleges and universities, this is more than just a crisis of confidence; it’s a case for improving risk management.
At least 25% of private colleges are now running deficits. Even in a good economy, public college expenses generally outpace tuition revenue. But demographics are beginning to work against traditional colleges as the pool of 18-year-olds continues to decline.
Reduced revenues give rise to staff consolidations and staff reductions. Less training happens. Less process is followed. Less oversight occurs. Yet the pressure to raise money and fulfill enrollment quotas remains. This is where the crisis of confidence begins, and risk escalates.
Public disillusionment
Colleges and universities have been known to give preference to legacy students. In these challenging times, it is difficult for an institution to say no to a seven-figure gift, even if it is tied to the unspoken promise of an education for the offspring of the philanthropist.
Colleges and universities, historically revered, have become a target of public disillusionment over decisions made with finances in mind.
Should we just accept this diminished image of higher education? Most colleges and universities would say that their admissions policies are fair and that their approval processes are followed. But now that the lurid details of the admissions scandal have made it to grocery-aisle tabloids, a skeptical public says otherwise.
Risk management
To establish greater trust in the admissions process, leaders must recommit to managing risk in these key areas:
- Better process: Conducting an audit of current admissions policies and procedures that includes staff interviews can help identify opportunities to improve current processes and locate gaps. Having a documented third-party review is also something credible that leaders can point to when prospective students, parents, the community and the board ask questions about admissions processes. It will not only provide peace of mind, but also mitigate risk.
- Adherence to training: A recurring review of training curriculum can ensure that staff development tools are up to date. It is also important to review the training and continuing education credentials of staff, including new hires. Sometimes, between new hires, staff transfers and staffing reductions, training cycles are missed. Also, leaders must make sure that the requirements for ethics training are in place. Some institutions are moving to annual ethics certification for all employees.
Colleges and universities, historically revered, have become a target of public disillusionment over decisions made with finances in mind.
- More oversight and accountability: Decision-makers in the admissions and fund development offices should be required to complete conflict of interest statements. In addition, every higher
ed institution should have a whistleblower policy. Some institutions even have a hotline that encourages internal feedback. - Enhanced transparency: Institutions should be open about their efforts to reduce exposure to fraud in their admissions processes. Given the notoriety of the current scandals and the high-profile nature of the institutions involved, having responsible and ethical admissions practices is expected. Efforts should be documented on school websites and in annual reports, brochures and marketing materials.
Regardless of what happens with the scandal, colleges and universities should see this as an opportunity to be proactive. It’s a chance to put the right controls in place so leaders can stand up and say: “This is what we do to maintain integrity in our admissions process.” That way, they’ll be able to answer the most important question before it’s asked.
Jean Close is a partner in The Bonadio Group’s Healthcare/Tax Exempt Division, specializing in providing financial audit, benchmarking, finance and risk management consulting services to higher ed institutions.
