Harvard Created Windfall From Bringing Executives Back to School

Yahoo

3 days ago

(Bloomberg) -- Harvard University is drawing an increasing share of its revenue from helping businesspeople beef up their résumés, giving America's oldest institution of higher learning a lifeline as it confronts its largest-ever crisis.
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Years before the Trump administration halted billions of dollars in federal funding over allegations of antisemitism, discrimination and a lack of differing viewpoints on campus, the wealthiest US university had been putting a greater emphasis on professional and executive education.
Executives looking to step up their management skills or get up to speed on new technology have eagerly shelled out for expensive in-person and online courses at the storied university out of their own pockets, or with help from their employers. Those programs are now providing Harvard with revenue that's relatively insulated from US President Donald Trump's efforts to deprive Harvard of federal funds — and helping soften the blow as administrators watch expenses rise, endowment returns sag and donations drop.
Overall, executive education and continuing education for nontraditional students delivered nearly $600 million last year, up from $155 million two decades ago, publicly available data from the university shows.
Alumni of Harvard's undergraduate and graduate programs have sometimes scoffed at such programs, posting memes to social media implying that they lack Ivy League gravitas. (Along with executive education, Harvard also offers programs for lifelong learners and students seeking a nontraditional path to a degree). But putting the Harvard imprimatur on classes that let corporate managers burnish their bona fides and expand their networks is providing the embattled university with an important safety net at an uncertain time for US colleges and universities.
The Trump administration has attempted to squeeze Harvard financially, including by freezing more than $2.6 billion in federal research funding and trying to end its tax-exempt status. It has also sought to bar enrollment of foreign students, who frequently pay full tuition. The university has been in talks with administration officials about a possible settlement, though the details and timing of a potential deal remain uncertain.
The proceeds from continuing and executive education programs accounted for 9% of Harvard's $6.5 billion operating revenue base in 2024, its financial report shows. By comparison, federal research money accounted for 11%. The programs made up 42% of the school's net tuition and fee revenue in 2024, up from 26% in 2005.
Harvard's nondegree courses range from short-term certificate programs to in-person, long-term training for executives and senior professionals. They can bring in anywhere from several hundred dollars to more than $10,000 per student. One multiyear Harvard Business School program can cost as much as $150,000.
Harvard gives generous financial aid to many of its undergraduates. The tax law signed by Trump this month limits borrowing by graduate students. But many continuing and executive education students aren't reliant on loans or other federal assistance to pay their expenses. Companies can pick up the tab for employees, and in some cases veterans are eligible for tuition assistance under the GI Bill.
Billionaire Backers
Executive education has also lured funds from another core Harvard constituency: billionaires with their names adorning a building.
Tata Hall is named in honor of Indian industrialist Ratan Tata, who died in 2024, and attended Harvard's Advanced Management Program, which prepares executives for leadership roles, in the 1970s. Tata Companies and other philanthropic entities gave Harvard Business School $50 million to construct the 150,000-square-foot building, which was completed in 2013.
Brazilian Andre Esteves, cofounder and chairman of Brazil-based investment giant Banco BTG Pactual SA, and his wife funded the renovation of a residence hall for executive education bearing his name at Harvard Business School. Esteves, who didn't earn a degree from the school, has also financed scholarships for Brazilian students.
Representatives for Tata and Esteves declined to comment.
Executive education was the second-biggest source of revenue at Harvard Business School last year, bringing in $245 million. Online education fetched another $70 million. The business school has about 42,000 executive education students enrolled on the web, more than double the level in 2019.
Harvard's professional education programs have a large and increasing number of international students. Roughly 70% of Harvard Business School's 12,000 executive education students hail from abroad — a big selling point for many who enroll.
In May, Raoul-Gabreil Urma, the founder of an education-technology business who lives in the UK, finished a multiyear program with three on-campus components called 'Owner/President Management' that costs about $150,000. He also took a course that will prepare him to serve on corporate boards.
'It's lonely being a business owner and CEO,' Urma said. It's one of the only programs 'that brings a world-class international community together to learn together and share challenges.'
Trump's efforts to keep Harvard from enrolling foreign students could upend that appeal. Yet the growing number of elite US colleges and universities offering executive education programs are banking on continued demand at home and abroad. The Massachusetts Institute of Technology, Columbia University, the University of Virginia and other schools are marketing such programs online and on social media like LinkedIn.
Virginia's Darden School of Business offers lifelong learning and executive education for individuals and organizations including the military and government agencies. Participants can stay at a new on-campus Kimpton hotel owned by the Darden School foundation. The school has also expanded in the Washington, DC, area to meet rising demand from working professionals.
Columbia's business school offers a nine-to-12 month program for chief financial officers that can cost up to $30,000. MIT is creating a private, not-for-profit educational institution through a network of campuses around the US for in-person and digital classes. The University of Pennsylvania's Wharton School of Business created a campus in San Francisco in 2001 that now includes executive and other education.
At Northwestern University, the Kellogg School of Management delivered about 350 continuing education programs to more than 22,000 participants in fiscal 2024, its highest demand ever. The Chicago-area school plans to aggressively invest in development of more, including a dozen new programs to market over the next six months, said Thomas O'Toole, associate dean for executive programs.
To expand their global footprint, dozens of schools, including Wharton, Kellogg and Harvard Medical School, collaborate with a Singapore-based company called Emeritus Education for short courses, degree programs, executive and certificate programs.
Expansion Plans
Along with its business-school programs, Harvard offers executive and continuing education through its medical, law and public health schools, as well as the Kennedy School of Government.
On its website, the Kennedy School describes dozens of executive programs, including a six-day, on-campus cybersecurity certificate program that costs $11,300 (an online version of the course is priced at $5,100).
For years, the US government had paid Harvard for courses and other services in which senior employees, including military and defense officials, updated their credentials. Those payments peaked at about $4.4 million in fiscal year 2023, according to Bloomberg Government data. Harvard's US government contracts have been frozen amid Trump's efforts to clamp federal funds flowing to the university.
In June, Harvard's TH Chan School of Public Health tapped Rifat Atun, a physician and global health-systems expert, as a new vice dean for non-degree education and innovation. In that role, Atun will look to bring in more money through new certificate programs, short courses and executive education.
Last year, Chan drew almost 60% of its revenue from federal research money, and it has been forced to make cuts as Trump tightens the spigots. To fill the gap, continuing education can bring in thousands of dollars for programs that run for less time than a traditional academic semester. For example, the school advertised on LinkedIn this summer for a five- to six-month online leadership program that cost $14,000 before any discounts.
Atun has taught professional-education courses ranging from leadership classes for nurses to custom courses for employees of global drug and medical-device companies.
'This is an opportunity to rethink and expand, building on the strength of what is being provided and better understand the needs of current and potential customers and the segments we serve,' he said in an interview.
Chan plans to grow its professional education efforts to Latin America and the Middle East, Atun said.
Other parts of Harvard are also expanding their continuing-education menu. New offerings in the year that begins this fall at the Harvard Extension School include microcertificates in AI-related topics and new online graduate certificates that can be 'stacked' toward a master's degree.
Continuing and executive education is expected to be more lucrative than other efforts the university has made to expand access to its academic offerings, such as an earlier experiment with free online courses for students who didn't earn credit or a degree. Online education was conceived as a free good, said Peter Bol, a Harvard professor of East Asian Languages and Civilizations and a former vice provost responsible for online learning.
'Obviously it was a money loser,' Bol said. 'Executive education was not.'
--With assistance from Alexander McIntyre, Mathieu Benhamou and Tom Contiliano.
(Corrects Andre Esteves title in 12th paragraph.)
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