Accreditation used to be invisible. That was the point. It operated in the background, a quality assurance process that decided who got access to federal dollars. Most students never heard of it. Most university leaders treated it as compliance, not strategy.
In June, the U.S. Department of Education notified Columbia University’s accrediting agency of potential civil rights violations. The government is now willing to use accreditation status as leverage in political and cultural disputes.
This wasn’t an isolated act of pressure. The federal government has changed the rules to allow institutions to switch accreditors more easily. It has lifted the moratorium on new accrediting agencies. It has directly criticized accreditors for enforcing standards related to diversity and equity. And it has opened the door to alternative quality assurance models entirely.
Together, these moves signal a shift in how accreditation functions.
What remains unchanged is its financial power. Title IV student aid—Pell Grants, Direct Loans, and work-study dollars—flows only to institutions that are accredited by a federally recognized agency. That gatekeeping role affects more than $110 billion in aid annually. Losing it is an existential threat.
But the system's influence is increasingly out of sync with its reputation. More than half of all college-bound students now say they question whether a traditional four-year degree is worth the cost. Employer trust in higher ed has fallen for five consecutive years, according to surveys by Gallup and the Association of American Colleges and Universities. And only 34 percent of Americans now say colleges have a positive effect on the country, down from 57 percent a decade ago.
Accreditation has become the front line in a broader credibility crisis. Its legitimacy depends on public trust.
Accreditation Protects Institutions. It Doesn’t Protect Students.
The U.S. accreditation system wasn’t built to reward innovation or enforce excellence. It was built to prevent fraud.
Its primary job is to determine whether a college deserves access to federal funds. It does this by reviewing governance, financial stability, faculty credentials, curriculum design, and institutional policies. These are inputs. Accreditation measures the machinery, not the results.
The process itself is peer-driven and slow. A typical accreditation cycle takes 7 to 10 years. Reviews are conducted by fellow institutions. Site visits are announced well in advance. Problem schools are often given multiple chances to improve.
The stakes, however, are high. If a school loses accreditation, it loses access to federal aid. That aid accounts for more than 75 percent of tuition revenue at some institutions. The result is often immediate collapse.
That threat has created a system designed to avoid failure. In practice, it means schools that are struggling—financially, academically, or ethically—rarely lose status. A Government Accountability Office report found that accreditors rarely terminate accreditation, even when major problems are documented. Most issue warnings. Some extend deadlines. Few pull the plug.
The reason is structural. Accreditors are funded by the institutions they oversee. Their relationship is more advisory than adversarial. And the consequences of a failed review are so severe that agencies are incentivized to maintain stability, not raise standards.
The outcome is predictable. Colleges that offer poor returns can remain in good standing. Students who attend them can rack up debt, earn a degree with little market value, and still be told their school is accredited.
Accreditation secures federal funds and institutional reputations. But it doesn’t secure outcomes. It doesn’t secure students.
And now, it’s being asked to enforce something else entirely: political priorities. Columbia’s case is a proof of concept. Accreditation can be challenged on ideological grounds, and accreditors can be pulled into the fight. For schools with fewer resources and lower visibility, the risk isn’t theoretical.
The Market Has Moved On
The most credible signals of educational quality are no longer coming from accredited institutions. They are coming from outside the system.
Over the past five years, enrollment in non-degree programs has surged. More than 40 million Americans now hold a certificate, digital badge, or industry credential. Companies like Google, Amazon, and Salesforce are issuing their own microcredentials. Bootcamps and online academies are filling seats without ever applying for accreditation.
These programs are judged by outcomes, not oversight. If graduates get hired, the model spreads. If they don’t, it disappears. That kind of feedback loop carries more weight in the labor market than a regional accreditor’s seal.
Students are responding. Undergraduate enrollment at four-year colleges is down nearly 10 percent since 2019. At the same time, the number of learners enrolled in short-form credential programs has grown by double digits. Stackable programs, income-share agreements, and skills-based hiring have all gained ground.
Employers are adapting as well. A 2023 SHRM report found that 72 percent of HR professionals now value alternative credentials in hiring decisions. At IBM, nearly half of new U.S. hires last year did not have a college degree. The degree is no longer the default.
The accreditation system has not adjusted. Its standards still revolve around classroom hours, faculty composition, and institutional structure. These make sense for a traditional campus model. They are ill-suited for models built around speed, flexibility, and job placement.
This mismatch is growing. Accreditors care how education is delivered. The market cares what it delivers.
Reform Has Been Mostly Cosmetic
Calls for accreditation reform are not new. But most of what has changed in the last five years has been procedural, not foundational.
The Department of Education has made it easier for colleges to switch accreditors. It has reopened the door to new agencies. It has also challenged standards related to diversity and speech, framing them as violations of civil rights law. These moves have injected politics into what was once a bureaucratic process.
Supporters call it competition. Critics call it arbitrage. Both are correct. Institutions can now select accreditors with fewer constraints. That opens the door to experimentation, but also to race-to-the-bottom behavior. If one agency tightens standards, another may offer a looser path.
The Columbia case made that power shift tangible. The Department of Education didn’t revoke funding or rewrite policy. It sent a notice to the accreditor. That alone was enough to spark institutional panic. The message was clear: accreditation is now a lever for political enforcement, not just educational oversight. And while Columbia may have the legal team and brand capital to weather the threat, most schools don’t.
Meanwhile, technological upgrades have changed the form of reviews, not the substance. Virtual site visits are more common. Digital evidence repositories are improving the process. But the criteria being reviewed have remained largely static. They still focus on inputs.
Some agencies have piloted outcome-based metrics, particularly in health, law, and technical education. A few are exploring frameworks for microcredentials and competency-based programs. But none have rewritten the playbook. The five-year review cycle still dominates, and the credit hour remains the default unit of measurement—both relics of a slower, more stable era.
The gap between rhetoric and reality is widening. Accreditors speak of innovation, but operate from templates built for another era. Institutions claim accountability, but often define success by compliance. Reform exists, but it is mostly surface-level.
We work with vendors across EdTech, credentialing, and publishing to understand what higher ed buyers actually want—and what they’ll pay for. That includes pricing research, competitive intelligence, and direct buyer interviews across functions and regions. And we support investors with commercial due diligence on institutions and providers where long-term value depends on outcomes, not accreditation. Especially in markets where credibility is shifting fast.
The Seal That Covers the Rot
Accreditation doesn’t just fail to guarantee quality. It enables decay.
Colleges with shrinking enrollment, dismal graduation rates, and poor debt outcomes remain in “good standing” year after year. The public sees the seal and assumes someone checked. But no one really did—not in a way that matters.
The system certifies paperwork. Not performance. Not student outcomes. Just paperwork. That’s how institutional decay hides in plain sight.
If you’re a university president and your business model relies on accreditation to prove value, you’ve already lost the argument. Outcomes prove value. The seal just delays the reckoning.
Boards need to stop treating accreditation as a moat. It’s a permission slip, not a proof point. It gets you into the game, but it doesn’t protect you once you’re there. Students are making decisions based on placement rates and ROI. Employers are trusting internal training more than degrees. Accreditors are still looking at governance documents.
This is regulatory malpractice masquerading as oversight.
And it’s not just a technical flaw—it’s a reputational risk. Every time an accredited institution fails its students, the seal becomes less credible. That’s not the student’s fault. It’s the system’s.
What happens when the seal loses all meaning?
Simple. People stop looking for it.
The seal isn’t broken. It’s empty. And people are walking past it.
