WASHINGTON — New models of colleges — coupled with new ways to rank them — got a fresh look Tuesday during a discussion about the future of higher education from the standpoint of administrators.
Geoff Cox, senior associate dean for finance and administration at Stanford University, said he was “fairly optimistic” about the promise of operating colleges as “benefit corporations,” which are essentially for-profits that aren’t entirely beholden to shareholder interests.
“The argument is that in a traditional for-profit setting, the company’s only fiduciary obligation is to maximizing shareholder profits,” Cox said. But under the benefit corporation structure — not to be confused with a B Corp seal of approval — there are protections that “curb” against being in business solely for profit and allow an institution to be more mission driven, Cox said.
“I’m fairly optimistic that this general model is something that could be applicable to a surprisingly large segment of higher education that is undercapitalized, tuition-dependent, and serve an important mission in our system of higher education,” said Cox, who oversaw the conversion of Alliant International University, of California, from a nonprofit to a benefit corporation in February 2015.
Cox — who said he is no longer associated with Alliant — made his remarks Tuesday at the National Press Club during an event titled “Public Administration Perspectives on the Future of Higher Education.” The event was organized in conjunction with Arizona State University and Public Administration Review, a bimonthly journal of the American Society for Pubic Administration.
Cox said the influence of the for-profit sector is changing the way colleges and universities operate.
“A significant effect of for-profit education is expensive marketing efforts,” Cox said. “Where lots of schools could rely on regional catchment areas without having to worry about where they attract students from, those days are simply gone.”
