Lack of Financial Literacy and Business Education Leaves Young Athletes Vulnerable in Emerging NIL Landscape
The rapidly evolving landscape of Name, Image, and Likeness (NIL) policies in high school and college sports presents significant new challenges for student-athletes, according to a sports management expert at Florida Atlantic University (FAU).
The absence of clear guidelines and the proliferation of unregulated agents underscore a critical need for enhanced financial literacy and business education for these young individuals.
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Daniel Cornely, director of the MBA in Sport Management program in FAU’s College of Business, highlights the growing concerns surrounding the terms of NIL agreements, the involvement of non-certified agents, and whether students possess the necessary knowledge to navigate these complex deals.
“Right now, we have non-certified agents working with student-athletes, giving advice that may or may not be helpful or correct,” Cornely stated. “NCAA athletes need to be educated properly on what the terms mean when finalizing a deal with a university.”
The NCAA’s landmark decision in June 2021 to allow college athletes to profit from their name, image, and likeness marked a major shift, with Florida being an early proponent of NIL laws in 2019. High school athletes in Florida can also now earn money through NIL deals without jeopardizing their athletic eligibility, a change from previous guidelines that restricted earnings based on the use of school intellectual property or certain promotional content.
While largely seen as a positive development, Cornely warns that student-athletes are entering uncharted territory, facing new agreements and even potential back payments for the past use of their name, image, or likeness.
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“The student-athletes need to be protected by way of business education and a curriculum that provides financial literacy, marketing awareness, and an entrepreneurial mindset,” Cornely emphasized. “This will help them in the long run, whether they make it to the pros or not. They will be in an educated position about the money they received, which should allow them to flourish long term.”
FAU’s MBA in Sport Management degree program is designed to equip students with the skills and knowledge to thrive in the business of sports. The program combines a rigorous business curriculum with a specialization in sports management.
The practical value of this education is evident in the success of alumni like Branden Birch, a 2016 graduate of FAU’s MBA in Sport Management program. Birch transitioned from a professional hockey career to becoming the Director of Hockey Operations and Salary Cap Management for the Florida Panthers.
His coursework, particularly in Financial Aspects of Sport Management, proved instrumental in his ability to ensure the team’s compliance with the NHL’s salary cap, demonstrating how a strong academic foundation can empower athletes long after their playing days conclude.
“This will also help fend off NIL agents who are not supporting students’ best interests as they negotiate deals with the general managers of teams and will need to make sure students are aware of the financial aspects of their deals,” Cornely concluded, underscoring the vital role of education in safeguarding student-athletes’ financial futures.
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