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Managing risk in Higher Education: Higher Education sector risk profile 2021

The last 12 months have tested the higher education sector like no other year. The pace and scale of change and the challenges faced by universities is unprecedented; the COVID-19 pandemic has disrupted every aspect of university life and both staff and students have had to show tremendous resilience.

Our annual benchmarking study analyses the risk registers of a sample of 22 higher education institutions and highlights the most significant risks facing the sector, outlining how institutions are responding.

Unsurprisingly, 2020/21 has been a year for change in the trends we’ve seen previously, with the top five themes being dominated by the impact of the COVID-19 pandemic. The change in the trend for 2020/21 correlates with the high risk issues coming out of internal audit reviews performed during the pandemic, with four out of the top five issues being related to data or IT.

The good news is that we have continued to see universities seeking to strengthen their risk management processes and this, along with a broader control environment which is robust and effective, will be important factors for success in the years to come. The pandemic has shown the need to be more agile and forward thinking in managing risks and it is encouraging to see how the higher education sector has stepped up.

Key risks facing the sector

Cyber security and information governance

Cyber security and information governance are the top risks identified by universities in this year’s report, reflecting the increase in the number of cyber attacks and attempts to penetrate university systems during the pandemic.

While the sector has been focusing on cyber security and information governance for some time, the pandemic has given it new impetus. Previously some universities still had a fragmented IT set-up, but now we are seeing universities give this area much more focus and resource.

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COVID-19

The impact of the COVID-19 pandemic on an institution’s ability to deliver its ‘business-as-usual’ has been unprecedented. This has included moving to online teaching, remote working for staff and academics, and responding often quickly to changing guidance. Even institutions with well established crisis management teams and business continuity plans have had to evolve their approaches to manage the prolonged impact as the COVID-19 pandemic situation has unfolded.

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Student experience

2020/21 is possibly the most difficult academic year in the modern history of the higher education sector for ensuring a consistent and high quality student experience, and the inclusion of this risk high on institutional risk registers is to be expected. There are numerous links to other risks identified, showing the breadth of challenge to an institution’s ability to manage continued high quality delivery.  

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Mental wellbeing

The importance of mental wellbeing has been on the higher education agenda for a number of years with steady increases in the numbers of reported mental health conditions in students – analysis by the Office for Students indicates an increase from 1.5 per cent to 4.4 percent over the 5 years from 2013/14 to 2018/19.

The COVID-19 pandemic has brought health and wellbeing into focus more as students adapt to new ways of living and studying, including remote and blended learning, and potential periods of self isolation.

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Student recruitment

Student recruitment risk is one of the highest recurring risks across institutional risk registers. This risk has been a constant over recent years. With market competition increasing year on year, the perceived risk has been further heightened by the UK’s departure from the EU and subsequent trade deal. The uncertainty of Brexit paled into insignificance when compared with the uncertainty caused by the impact of the COVID-19 pandemic, although in the longer term it may be Brexit that has the greater impact.

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Contact us

Alison Breadon

Markets Senior Partner, East Midlands, PwC United Kingdom

Tel: +44 (0)7740 894817

Charlie Martin

Senior Manager, PwC United Kingdom

Tel: +44 (0)7732 864402

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