AGB President & CEO Update: Fiduciary Duty

You are viewing the Institution and Systems version of this CEO Update. An Institutionally Related Foundation version is also available.

In these turbulent and uncertain times for higher education, we recognize the immense challenges that boards and presidents face in guiding their institutions forward. The evolving landscape demands adaptive leadership, informed decision-making, and strong governance to ensure stability and progress. AGB is committed to equipping our members with the essential resources and insights to navigate this complexity—helping you not only to understand your roles but also to harness the power of effective governance to secure and advance your institutions, systems, and foundations.

Understanding Fiduciary Duty in a Complex Environment

In today’s unprecedented landscape, many board members are struggling to reconcile federal directives with existing state laws and institutional policies. This complex governance environment demands a nuanced understanding of legal obligations, a commitment to institutional autonomy, and a strategic approach to balancing diverse stakeholder interests.

At the heart of effective governance lies fiduciary duty—a core responsibility that board members must uphold to ensure institutional integrity and success. Board members have a duty of care, loyalty, and obedience to the institutions they serve. This means:

Making well-informed, good-faith decisions aligned with the institution’s mission and best interests.
Acting independently and avoiding undue influences.
Upholding governance principles as outlined in institutional bylaws, board policies, and codes of ethics.
Recognizing that for public institutions, state law may further define fiduciary duties, particularly for regents and public bodies.

Regardless of institution type, adherence to these best practices is essential for strong governance and institutional integrity.

Key Questions for Boards to Consider

How does our board ensure that it understands and upholds fiduciary duties?
How does our board evaluate what kind of influence would qualify as contrary to its fiduciary standards?
How do we balance institutional autonomy with compliance obligations under federal and state laws?
Are our decision-making processes transparent, mission-aligned, and free from undue external influence?
How are we equipping board members to navigate governance challenges effectively?

Go Deeper

Explore these key resources to deepen your understanding of fiduciary duty:

AGB Board Statement: Fiduciary Duties of Governing Board Members
Book: Higher Education Governing Boards: An Introductory Guide for Members of College, University, and System Boards
Trusteeship magazine article: “Fiduciary Duty Is the Law”
Video: “What Is a Fiduciary?”
FAQs: Fiduciary Duties for Institutional Board Members
Additional support: AGB-Facilitated Board Workshops and Retreats

In Case You Missed It—Implications of the Executive Order on the U.S. Department of Education for Governing Boards

A new Executive Order proposing the dismantling of the U.S. Department of Education—while unlikely to be fully enacted—signals significant potential disruptions to federal support for higher education. In our latest AGB Policy Alert, we outline key risks for board leaders, including risks to student protections, financial aid, accreditation, and research funding, and offer strategic guidance to help boards prepare and respond.

AGB Receives Mellon Foundation Grant Supporting Academic Freedom and Free Speech

I am proud to share that AGB is partnering with the Mellon Foundation on a new initiative designed to strengthen trustees’ understanding of academic freedom and free speech. Trustees play a crucial role in ensuring that institutions remain centers of open inquiry and critical thought. Over the next 18 months, we will develop educational resources, host convenings, commission research, and create a practical governance guide to support institutions in protecting these fundamental values.

As this initiative progresses, we invite additional partners and funders to join us in expanding this work. We also invite you to participate in a short, anonymous survey to help inform our efforts. Your input on issues related to free expression and academic freedom in higher education is invaluable. Take the brief, anonymous survey.

Promoting the Value of Higher Education

Higher education has long been a catalyst for progress, fueling innovation, economic prosperity, and democratic stability throughout American history. AGB is championing the value of higher education through two major initiatives:

Why College Matters—We’re a proud sponsor of a new public service campaign that highlights the value of college and the far-reaching impact of higher education. Learn about the campaign and join AGB in endorsing it.
Higher Education as a Strategic Asset (HESA)—As the incubator of HESA, AGB continues to provide strategic support and guidance to this commission dedicated to reshaping policy, funding, and collaboration of higher education to strengthen U.S. innovation and competitiveness. HESA recently released its report outlining key strategies to drive U.S. prosperity and security. Learn about HESA and read the report.

2025 AGB Board Professionals Conference and National Conference on Trusteeship

I was delighted to meet with so many of our members at the Board Professionals Conference and the National Conference on Trusteeship in Chicago last week. With all the uncertainty facing higher education, it was inspiring to come together and share in thought-provoking sessions with expert panels and walk away with actionable strategies to guide institutions forward.

Throughout the conferences, the importance of fiduciary duty was a recurring theme, both in sessions and in informal conversations. With growing state and federal challenges and confusion about the role of trustees, discussions focused on how board members can keep fiduciary responsibility front and center—ensuring that governance remains mission-driven, principled, and resilient in an increasingly complex landscape.

This year’s sessions were especially timely, and included:

The Future of Higher Education Leadership—Addressed shifts in leadership models and the evolving expectations of trustees and presidents.
Public Trust and Higher Education’s Value Proposition—Provided strategies for rebuilding confidence in higher education amid public skepticism and declining enrollment.
Free Speech, Academic Freedom, and Governance—Explored the intersection of governance and free expression, including insights from AGB’s partnership with the Mellon Foundation.
Institutional Neutrality—Provided a deep dive into the complexities of institutional neutrality, exploring how boards can craft thoughtful policies that balance mission alignment, community impact, and the need for open dialogue.

Please remember that AGB is here to connect you with the experts, tools, insights, and peers you need to lead in this changing and challenging environment. Thank you for your continued leadership and engagement. I look forward to the work we will accomplish together.

Ross Mugler
AGB Board Chair and Acting President and CEO