NIL Education: The Cost of Teaching Business
Name, Image and Likeness has dominated the conversation within intercollegiate athletic circles for much of the past year. Now two months into the NIL era, we are starting to identify where some of the gaps exist within the current process. One of those areas seems to be around education.
From the student perspective, NIL presents a tremendous opportunity and potentially endless new revenue streams. However the message across the board from student-athletes is that they need help! For many students, most of whom are likely not well versed in the ways of business, NIL is proving to be quite overwhelming. Every student-athlete who engages in any NIL opportunity essentially becomes a small business owner. With that comes a whole host of responsibilities that will likely require a basic knowledge in areas such as tax liability, financial planning, legal liability, contract negotiation, marketing and insurance, just to name a few. This would be daunting for most adults regardless of our level of experience. Obviously, since very few college students come to campus with extensive knowledge in many of these areas, they will undoubtedly need educational support in order to protect themselves and avoid missteps that could be very costly down the road.
From the institution’s perspective, one of the questions that has been repeatedly asked is, what exactly is the school’s responsibility as it relates to educating their student-athletes about NIL? Some have argued that the institution has a duty to prepare their student-athletes for life and that NIL education falls squarely in line with their overall educational mission. Others, however, believe now that students have the opportunity to monetize their own personal attributes independent of their school, with that comes the responsibility to manage their own affairs, including educating themselves appropriately.
NIL legislation has solved that dilemma in many states by mandating that institutions provide some level of education for all student-athletes. Of the 29 states that have enacted NIL legislation, seven (Florida, Georgia, Kentucky, Louisiana, North Carolina, Tennessee and Texas) have language in their statutes that either requires or strongly encourages education.
For example, Florida was one of the first state NIL bills to go into effect. Their legislation (SB 646) stipulates that schools must provide a five-hour financial literacy workshop at the beginning of every student-athlete’s first and third year that covers the topics of financial aid, debt management, time management, budgeting and an overview of available academic resources at the institution. The other states with requirements have similar stipulations for educational content.
- Kentucky and North Carolina are unique in that while the other states ratified bills through their legislature, Governors in these two states implemented NIL guidelines via Executive Order.
- Kentucky, however, is the only state that incorporated social media and brand management education into their curriculum.
- North Carolina has many of the same content areas as the other states, however unlike Florida, Georgia, Kentucky, Louisiana, Tennessee and Texas who have mandated these efforts, North Carolina’s Executive Order only recommends that this education be provided, but stops short of requiring it.
Even in these states, however, is it enough and does the legislation focus on the right things? Critical areas such as liability and risk management are not a part of the required educational content in any state. Only one state (Kentucky) requires education around brand management, a vitally important aspect of NIL.
Below is a chart that summarizes the educational requirements in each state:
NIL Education Requirements by State
|Social Media/Brand Management||X|
***Recommended but not required
Of course, many institutions will opt to provide education to their student-athletes even in states where there is no requirement to do so. A number of departments plan to leverage relationships with business and professional schools on their campuses while others have outsourced this responsibility to third party entities. However, developing this content and delivering it en masse to large groups of student-athletes isn’t cheap. This has left many athletic departments wondering if they can afford to develop robust educational programming for their students. Others, on the other hand, wonder if they can afford not to.
However schools choose to address this critical issue, it seems clear that there is an appetite for more guidance among student-athletes and parents. How institutions respond to this desire for information may directly impact their ability to attract student-athletes and build successful programs.
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