Risk Engagement for Colleges:
Grinnell is at the forefront of a new approach that colleges and universities can use to handle risk. Adapted from the enterprise risk management practiced in the corporate world, Grinnell’s model gives priority to academic values, not just the financial bottom line.
Why is Grinnell the right place to study risk?
The College has a tradition of taking risks. Grinnell College in the Nineteenth Century by Joseph Wall ’41 describes how the Iowa Band originally founded the College in response to “a dare tauntingly thrown at them” by a mentor they greatly respected.
When Grinnell attained national prominence in the 20th century, its rise in fortunes was also connected with risk. Trustees like Warren Buffett and Joseph Rosenfield 1925 multiplied the endowment through bold financial speculations. They were Grinnell’s “risk-taking pioneers of the 1970s,” wrote Alan Jones ’50 in his book Pioneering.
More recently, the board of trustees took a chance by appointing a president who acknowledged having little experience with liberal arts colleges. Raynard S. Kington arrived on campus in 2010 and asked his team of senior leaders, “What are our institutional plans and policies to manage risk?”
That early dare from a new president had no easy answer. But his question spurred leaders at Grinnell to develop and share a new approach to risk — one now embraced as a model by other liberal arts colleges.
A risk model that suits Grinnell
Apart from historical anecdotes, what makes this approach right for us? For one thing, a strong tradition of academic shared governance ensures that our risk categories won’t be overly “corporate.” Designed for financial services and businesses, enterprise risk management had to be translated into academic language and culture before it could truly serve a college.
Faculty leaders at Grinnell have a strong voice, so when administrators raise the idea that it’s time to analyze risk, the faculty can see to it that risks to the mission of teaching and scholarship take priority. Keeping academic values central remains a guiding principle in Grinnell’s “purposeful risk engagement” model.
As a college that welcomed diversity in admission pretty much from the beginning, Grinnell upholds diversity as a core value. A cautious attitude is common at many institutions of higher education, where administrators worry about greater diversity bringing new risks — embodied in anxieties about compliance, protests, and lawsuits.
At Grinnell we view diversity as positive and seek to identify (and engage!) risks that threaten what we value in a diverse community. Drawing strength from our history, we look beyond the dutiful surface of compliance and adherence to rules, and honor the spirit of educational opportunity behind laws like Title IX and ADA (Americans with Disabilities Act), a spirit that affirms real values behind institutional choices and actions.
Risk management as a balancing act
Risk management often involves keeping two complementary risks in balance. New protective measures that increase security could make a simple process take longer. Attempts to gain consistency across campus can threaten the flexibility and autonomy that faculty, staff, and students rightly value. The obligation to keep certain records confidential can limit transparency in communications.
To resolve such risk dilemmas, we look for solutions that balance competing needs as well as possible, using the mission as a frame of reference. We keep in mind that the academic mission itself has two sides: a responsibility to preserve knowledge from loss and a drive to extend the frontiers of new knowledge.
The typical new startup company has no duty to preserve ancient records or to fight the permanent loss of the world’s languages, cultural artifacts, and traditional skills. A business can readily reinvent itself without concern for such consequences.
This difference helps explain why institutional change at a college or university may appear frustratingly slow and deliberative to those accustomed to the business world. It also explains why the corporate model of risk management had to be translated into a new approach that takes into account what matters most in an academic setting.