AGB President & CEO Update: The Board’s Role in Governing Institutional Transformation

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Governing boards are being challenged to think differently about how they continue to deliver on their mission in a higher education environment shaped by demographic change, technological disruption, artificial intelligence (AI), evolving learner expectations, financial pressures, and an increasingly dynamic public policy landscape.

Preserving what makes an institution distinctive while adapting to the realities of today’s environment requires boards to view business model innovation as a strategic governance responsibility.

Below are fundamental questions that governing boards should be asking.

• Are we serving the learners and communities who need us most?
• How do our institution’s academic programs align with the needs of a future workforce?
• Is the institution effectively utilizing its resources to maximize mission impact?
• How can we use new operating models to strengthen institutional purpose and focus?
• What is the best way our institution can remain both financially resilient and mission-driven to ensure student success for the next generation?

Every institution will begin this work from a different place. Some institutions feel their current models are working well, while others are just beginning to question whether change is needed. Many are already redesigning their enrollment strategies and academic portfolios, exploring alternative revenue opportunities, integrating AI, and forming strategic partnerships. No matter where an institution falls on this continuum, it is the governing board that must ensure business model innovation strengthens both the mission and the institution’s long-term sustainability.

Advancing business model innovation requires significant work between governing boards and presidents in building trust, asking difficult questions, developing institutional talent, fostering a culture of innovation, and making decisions that position their institutions to adapt continuously while remaining true to their core purpose. The institutions that evolve while remaining anchored in why they exist are those that will be best positioned to thrive.

Business Model Change Is Already Underway. Is Your Board Ready?

In an August 2026 AGB pulse survey of more than 200 members, 90 percent said their board is evaluating or implementing changes to their institution’s business model. Yet among those, 37 percent said they either lack a plan or lack confidence in the plan they have.

The findings underscore both the scale of transformation underway and the critical role of governing boards in ensuring their institutions have a clear, mission-driven strategy for navigating change.

Recent federal actions and calls for institutional change have driven much discussion across higher education. External pressures will continue to evolve, but trustees’ fiduciary responsibilities remain constant. Boards must exercise independent judgment, safeguard their institution’s mission, and ensure that strategic decisions are made in the long-term interests of their institutions, not in response to short-term political or market pressures.

AGB Resources to Guide Boards in Advancing Business Model Innovation

• Knowledge Center: Finance and Business Model Innovation—AGB’s collection of research, tools, and guidance on financial sustainability, strategic transformation, governance, and business model innovation.
• 2027 AGB National Conference on Trusteeship—A gathering of approximately 700 board leaders, presidents, and higher education experts from across the country to explore emerging governance challenges, innovative practices, and strategies for advancing institutional sustainability.
• AGB Consulting: Business Model Innovation—Expert support in assessing institutional viability, identifying opportunities for innovation, and developing sustainable business models aligned with institutional mission.

Governing boards have a fiduciary responsibility to evaluate their institution’s business model on a regular basis to ensure it is positioned for long-term success.Boards that lead this work thoughtfully will create new opportunities for students, strengthen public trust, and expand higher education’s capacity to contribute to society. That is the promise of effective governance—and the work AGB is proud to advance alongside our members every day.