Higher education institutions across the country are struggling to remain true to their mission as their traditional business model becomes increasingly untenable. At the National Association of College and University Business Officers (NACUBO) 2026 Annual Meeting, industry leaders gathered to address the growing convergence of financial pressures, policy shifts, technological disruption, workforce challenges and declining public confidence that challenge their usual operating playbook.

While the challenges facing the sector are significant, the conference theme, Mission Meets Moment, underscored an important reality: disruption has become the norm and the institutions best positioned for long-term success are not merely reacting to it, they are building resilience through aligned leadership, disciplined governance, financial transparency, operational excellence and strategic adaptation. How leaders respond to these challenges will distinguish the institutions that will emerge stronger from those that will merely endure or even fold.

Strong governance requires broad alignment

One of the most consistent themes across sessions was the growing importance of alignment among chief academic officers, chief business officers (CBOs), presidents, governing boards and foundation leaders. The traditional separation between academic planning and financial planning is becoming increasingly difficult to maintain as decisions regarding academic programs, enrollment strategies, staffing models, student success initiatives and capital investments all carry financial implications that require shared ownership and collective decision making. CBOs should adopt a more integrated planning approach that brings multiple stakeholders together to develop a holistic strategy that accounts for the current climate's impact on academic programs, staffing and facility maintenance.

With these planning processes in place, and the right leaders at the table, organizations are better positioned to make proactive plans, rather than reactive decisions. Consider whether your current governance structures support collaboration across key stakeholder groups and if all the necessary decision makers are at the table.

Questions worth evaluating include:

  • Are academic priorities, financial plans and advancement strategies informed by a shared understanding of institutional goals, evolving business models and financial realities?
  • Do our key stakeholders understand our financial reality and how our business model is evolving or being challenged?
  • Who needs to be at the decision-making table when financial and operational decisions are made?
  • Are our trustees, administrators and foundation leaders aligned around long-term strategic priorities?
  • Have we utilized financial modeling and scenario planning to support decision making?

As institutions face increasing external pressure, governance models that encourage transparency, collaboration and accountability become a significant competitive advantage.

Financial literacy and storytelling are strategic imperatives

The role of the chief financial officer continues to evolve beyond financial stewardship. The most effective finance leaders also serve as educators and strategic communicators who can translate complex financial information into practical insights for a broad range of stakeholders.

As business officers look for alternative revenue streams to fill the gaps left by industry-wide enrollment declines, they must ensure there is understanding across the spectrum of stakeholders regarding the impact of financial pressure on their budget and programs. Similarly, it is important for leaders across the institution to understand how various revenue sources function. Tuition revenue, endowment distributions, grants, auxiliary enterprises and restricted donations often carry different levels of flexibility, and helping stakeholders understand those distinctions can lead to more productive conversations about resource allocation, strategic priorities and long-term sustainability.

It’s imperative that all advocates for an organization are able to articulate their organization’s impact, especially to donors seeking reassurance that their contributions will make a meaningful difference. Financial storytelling is a tool able to elevate the message in a way that moves from just transmitting data and metrics to creating meaning and inspiring action.

Leaders should ask:

  • Do key stakeholders understand the institution's financial picture?
  • Are financial challenges and tradeoffs being communicated clearly?
  • Can trustees and donors easily connect financial decisions to mission outcomes?

Ultimately, financial transparency is not simply a reporting exercise. When faculty, staff, trustees, donors and even students understand the financial realities that shape institutional decision making, they can make more informed decisions and are more likely to align behind a coordinated strategy.

Operational excellence has become a strategic differentiator

Operational effectiveness emerged as another key theme of the meeting. As institutions continue to face challenges related to workforce shortages, deferred maintenance and rising costs, they are rethinking organizational design, talent strategies and service delivery models.

For example, rather than viewing vacancies as positions that must automatically be filled, CBOs are evaluating more strategic and impactful investments in organizational needs and alternative strategies to pay for them. In some cases, this has involved investments in data analytics, process improvement and outsourced solutions that are utilized to improve operations and reduce costs.

The broader leadership question is whether institutions are designing operations for current financial realities and future needs rather than maintaining established practices.

CBOs should regularly evaluate:

  • Which activities are core to mission delivery?
  • Where can technology, external partnerships and outsourced services improve efficiency and effectiveness?
  • Do we have the information and processes necessary to effectively evaluate our current operational approach?
  • Do we have enough liquidity to address unexpected costs?

Institutions that approach operational excellence strategically are often better positioned to adapt as conditions change.

Risk management is a leadership imperative

Perhaps the timeliest discussions focused on organizational resilience and risk management. Policy changes, market volatility, cyber threats and operational disruptions require decision-making frameworks be in place before a crisis occurs — resilience is built before it is needed. These planning processes should involve stress-testing assumptions, understanding liquidity needs, establishing reserve funds, clarifying governance responsibilities and preparing leaders to respond quickly when conditions change.

Leaders should consider the following:

  • Have we stress-tested our financial and operational assumptions?
  • Does the institution understand its financial and operational vulnerabilities? Is there a risk management plan in place for these areas?
  • Is the chain of command clear, including which leaders have decision-making authority in key areas?
  • Is there a communication plan in place if any of these issues occur?
  • Do we have liquidity or reserve funds to address unexpected expenses?
  • If we faced a major enrollment decline, cyberattack, policy shift or market disruption tomorrow, are the right people already aligned to respond?

Revenue diversification must support mission

With continued enrollment pressures affecting many institutions, revenue diversification remains a significant area of focus. Leaders discussed a variety of approaches, including workforce development programs, continuing education offerings, auxiliary enterprises, community partnerships, facility utilization strategies and other mission-aligned initiatives. Successful examples generally shared a common characteristic: they complemented institutional strengths rather than distracting from them.

As institutions evaluate diversification opportunities, leaders may want to ask:

  • Does the opportunity align with institutional mission and strategic priorities?
  • Can it generate sustainable revenue growth?
  • Will it strengthen student, community or workforce outcomes?
  • What additional liabilities could this opportunity incur? (Insurance, deferred maintenance, staffing needs, mission creep, etc.)

The most effective diversification strategies are not simply new revenue streams. They create greater financial flexibility while reinforcing institutional purpose and value.

Foundations and donors are strategic partners

Foundations and advancement teams play an increasingly important role in raising additional low risk-, high return-on-investment funding for critical university needs. However, for this partnership to be effective, CBOs must treat philanthropy as a strategic capital lever and their foundation leaders as important partners. As such, foundation leaders should be included in financial planning sessions to encourage alignment around key priorities.

Consistent donor communication, clearly articulated funding priorities and strong engagement with trustees and volunteers can increase funding for valuable yet often under-funded line items such as unrestricted and reserve funds. However, donor relations managers cannot effectively raise funds if they cannot effectively articulate how these tools are essential to advancing mission outcomes.

For leadership teams, the central question may be whether advancement efforts are fully integrated into broader strategic planning conversations. When institutional leaders, boards and foundations operate from a shared vision, fundraising can become a more effective driver of long-term sustainability.

Business officers should discuss the following with foundation leadership:

  • Are we raising funds to support programs and expenses aligned with current goals and needs?
  • Are we effectively appealing to donors about our need for unrestricted dollars and funds that support sustainability initiatives such as reserves?
  • Is the finance office regularly coordinating with the foundation and providing them with the information they need to speak with donors about financial needs? Our solutions can be tailored to meet your unique needs.

Looking Ahead

Many of the challenges facing higher education are not cyclical. Demographic shifts, evolving workforce expectations, technological disruption, growing public scrutiny, enrollment pressures and rising operating costs are likely to remain defining features of the landscape for years to come. Waiting for conditions to stabilize or for historical operating models to regain their effectiveness is becoming an increasingly risky strategy. Institutions that continue to rely on assumptions that no longer reflect today's environment may find their strategic options narrowing over time.

The institutions most likely to thrive will be those willing to confront difficult realities early, make intentional tradeoffs and align resources around their highest priorities. Resilience will not come from a single initiative or strategic plan. It will be built through strong governance, integrated leadership, transparent communication, disciplined financial management, thoughtful risk-taking and a clear commitment to institutional mission. In an environment where disruption has become the norm, success will belong not to the institutions that resist change, but to those that use it as an opportunity to strengthen their relevance, deepen their impact, and position themselves for long-term sustainability.

Nonprofit Strategy & Solutions Group

PNC’s Nonprofit Strategy & Solutions group serves as a dedicated partner committed to empowering nonprofit organizations to achieve their missions. By combining national expertise with local knowledge, we provide comprehensive education and advice on governance, philanthropy and financial sustainability — going beyond asset management to deliver actionable insights that address the most pressing challenges nonprofits face. With our deep community ties, practical nonprofit leadership experience and strong local market presence, we provide meaningful solutions that optimize resources and deliver a sustainable impact.

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