From Financial Stewardship to Strategic Leadership: The CFO and the Future University
Higher Education is operating in a financial environment in which many of the assumptions that once underpinned institutional planning have become increasingly uncertain. Student recruitment is more volatile. Costs remain under pressure. Universities need to continue investing in people, technology, estates and academic capability while protecting the student experience and research mission. At the same time, institutions are being asked to demonstrate greater financial resilience and make increasingly difficult choices about where scarce resources should be deployed. The Office for Students’ May 2026 assessment found that, while the English sector’s aggregate financial performance had improved slightly in 2024-25, universities’ forecasts for future recovery remained heavily dependent on significant growth in student recruitment. It also observed that much financial risk management remained predominantly short-term. This is not simply a challenge for university finance functions. It changes the strategic importance of the Chief Financial Officer. The modern Higher Education CFO cannot simply tell the institution what it can afford. They increasingly need to help the institution decide what it should choose to afford. From financial control to strategic choice Financial stewardship remains fundamental. Universities need strong financial controls, accurate reporting, effective treasury management, robust forecasting and appropriate oversight of investment and expenditure. But these are increasingly the foundations of the CFO role rather than its limits. The bigger challenge is helping institutional leaders translate financial information into strategic choices. Recent work by PwC, Universities UK and Lloyds Banking Group highlights the importance of stronger financial governance and financial acumen across universities. Only 47% of roundtable participants felt that financial reporting in their institution actively influenced priorities and trade-offs, while only 25% said that information available to decision-makers was clear, timely and supported informed challenge. A university can have accurate financial information without necessarily having decision-useful financial insight. The strategic CFO therefore needs to help leaders ask: These are not simply finance questions. They are questions about institutional strategy. Moving beyond the annual budget Universities understandably devote considerable energy to annual budgeting. But one of the risks in a financially constrained environment is that the budget becomes the strategy. When this happens, institutions can become focused on achieving a particular year’s financial target rather than making the structural choices required for long-term sustainability. The Office for Students has highlighted this tension, identifying increasing action by providers on cost reduction and income diversification while noting that much financial risk management remains short-term. A balanced budget next year does not necessarily mean the institution has a sustainable operating model. Equally, carefully planned investment or restructuring costs today may be necessary to create a financially stronger organisation tomorrow. Financial sustainability should therefore be understood not simply as balancing income and expenditure, but as ensuring that the university’s strategy and operating model are economically viable over the long term. From cost-cutting to understanding value Cost reduction may be necessary, but not every saving creates value. Removing expenditure without understanding the activity it supports can reduce institutional capability, weaken services or create additional costs elsewhere. For CFOs, this means developing a much more sophisticated understanding of cost, contribution and value. The 2026 PwC work on financial acumen specifically highlights the importance of understanding the cost and contribution of different activities and having trusted information that can inform institutional choices. This should allow the conversation to move from “Where can we cut?” towards: “Where should we invest, reduce, redesign, collaborate, grow or stop?” That is a fundamentally different role for Finance. It moves the function from controlling expenditure to helping allocate scarce resources towards the activities that matter most. Challenging optimism and improving forecasting Universities operate in a sector where forecasts depend heavily on assumptions about student recruitment, international demand, research income, inflation, staffing and other factors that may change rapidly. The Office for Students’ 2026 assessment cautions that anticipated sector recovery relies heavily on projected recruitment growth. In this environment, forecasting should not mean producing one confident version of the future. It should mean understanding multiple plausible futures. The strategic CFO can strengthen decision-making through scenario modelling, sensitivity analysis and stress testing: The purpose is not to produce increasingly pessimistic forecasts. It is to ensure that strategy remains resilient when reality inevitably differs from plan. Investment during financial constraint Perhaps one of the hardest challenges facing CFOs is that transformation itself costs money. Universities need to invest in AI and digital capability, cyber resilience, new skills, organisational redesign, estates rationalisation and sustainability precisely when financial capacity is constrained. This creates a tension between affordability today and capability tomorrow. The strongest CFOs will therefore need to resist two equally problematic positions: assuming every transformation programme represents worthwhile investment, or assuming expenditure reduction is automatically prudent. Instead, the CFO needs to ask: That final question matters because failing to modernise can itself create significant financial risk. The CFO as an investor in transformation The CFO should increasingly think like an institutional investor. Universities have finite financial capacity. Every pound committed to one priority is, implicitly, unavailable for another. Capital allocation therefore becomes one of the institution’s most important strategic processes. Investments in technology, people, estates, academic portfolios and partnerships should not be viewed as independent business cases competing for approval. They should form part of a coherent portfolio of institutional choices. The question should not simply be whether an individual investment produces a positive return, but whether it is the best use of the university’s limited capacity to invest. Collaboration changes the financial model The financial challenge may also require universities to rethink what they provide themselves. The Universities UK Transformation and Efficiency Taskforce has advocated greater collaboration, shared services and shared infrastructure, alongside digital transformation, benchmarking and new collaborative structures. This introduces a different type of CFO conversation. Instead of asking “How much will it cost us to provide this?”, institutions may increasingly need to ask: “What is the most effective economic model for accessing this capability?” That could mean owning, buying, partnering, sharing or stopping. The CFO can provide the commercial analysis necessary to understand those choices
Veredus Appointed to the APUC Framework to Support Executive Search Across the UK Public Sector
Veredus is pleased to announce its appointment to the new APUC Framework, strengthening our long-standing partnership with APUC and providing organisations across the UK with a compliant route to access our executive search expertise. The framework is available to universities, colleges, the NHS and a wide range of public sector organisations, enabling them to procure executive search services through a trusted, pre-approved supplier. As part of the new framework, Veredus has been appointed to: Supporting Leadership Across the Public Sector Public sector organisations are operating in an increasingly complex environment, balancing financial pressures, organisational transformation, evolving governance requirements and growing expectations for public service delivery. Against this backdrop, securing exceptional leadership has never been more important. For many years, Veredus has partnered with APUC to support organisations in identifying and appointing senior leaders who combine strategic capability with the experience to lead through change. Our continued appointment reflects the strength of that relationship and our commitment to delivering high-quality executive search services across the public sector. Executive Search Designed Around Every Organisation No two leadership appointments are the same. Our executive search methodology is designed to adapt to the unique requirements of each organisation, combining rigorous market mapping, extensive stakeholder engagement, leadership assessment and inclusive search practices to identify exceptional candidates across diverse markets. Whether appointing executive directors, chief executives, governing body members or Chairs, we work collaboratively with clients to deliver recruitment processes that are robust, transparent and aligned with organisational priorities. A Trusted Procurement Route The APUC Framework provides organisations with a compliant and efficient route to procure executive search services, reducing procurement complexity while maintaining the highest standards of governance, transparency and value. As an approved supplier, Veredus looks forward to continuing to support universities, colleges, NHS organisations and public bodies across the UK with executive and board-level appointments that strengthen leadership capability and enable long-term organisational success. If you would like to discuss an upcoming executive or board appointment through the APUC Framework, we’d be delighted to speak with you. Contact us.