In this context, risk encompasses not just financial risk in endowment management but also physical, casualty, liability, business, and reputational risk. Abraham provides help for the CFO in learning not only how to control risk but also how to reduce risk and understand liability issues. The multifaceted role of the CFO is to identify risk, develop plans to reduce and control risk, transfer risk to others, and track and report the costs of risk management. Abraham asserts that the most important role the CFO plays is risk management to safeguard the assets of the institution. As higher education becomes more competitive and as controlling costs becomes critical in focusing scarce resources on quality programs, many colleges and universities have begun to use consortial relationships.
Consortia can provide program enrichment, cost avoidance, and cost reductions.
In Chapter Nine, Mary Jo Maydew describes the benefits and also the pitfalls of consortia. She provides as a case study the example of Five Colleges, Inc., one of the oldest and most successful consortia and identifies the advantages and challenges of consortial relationships. In Chapter Ten, Mary P. McKeown-Moak describes the advantages, disadvantages, and types of funding formulas used by states in the budgetary process. McKeown-Moak provides answers to these questions and includes methods for positioning the campus to minimize the disadvantages of formula budgeting. Another hat worn by the CFO is that of lobbyist or governmental relations specialist.