Every member of staff in your school has an account. A name in the directory, a line manager, a set of permissions, and an end date when they leave.

Until recently, the agents people built in Copilot Studio had none of that in a form your IT team could easily see. That's now changed.

What's happened

Before May 2026, Copilot Studio automatically provisioned an Azure app registration for each new agent. Since then, it creates a Microsoft Entra Agent ID for every new agent, and you can no longer opt out.

Older agents stay on app registrations for now. Microsoft says it will migrate them in a future update, and admins can move them manually in the meantime.

So your agents now have their own identities in Entra, alongside the directory that holds staff and pupil accounts, with their sign-in activity logged in the Entra admin centre.

Think of agents as staff

The easiest way to explain this to a leadership team is to treat an agent like a new starter.

It needs an account. It needs someone responsible for it. It needs access to the right things and nothing more. And when the person who built it leaves, someone has to decide what happens to it.

That last point is the one schools tend to miss. Microsoft has added workflow templates that notify managers and hand sponsorship on automatically when a sponsor changes role or leaves, so agents don't end up orphaned. Those workflows need to be configured.

Every trust I've worked with has a story about the shared mailbox nobody owned, or the Teams site set up by someone who left three years ago. Agents could easily become the next version of that.

The sprawl question

Copilot Studio is low-code by design. Teachers and office staff can build an agent in an afternoon.

The catch is that each agent can connect to things. When an agent is published, Copilot Studio attaches an API permission to its identity for each connector it uses, so admins can see what it can call from the Entra admin centre.

When I ran Microsoft 365 across 15 organisations and 11 schools on one tenant, the hardest question was always "who built this, and what can it reach?" Now the answer lives in one place.

What it means for your licence count

The identity itself won't take a seat. An agent identity is a special type of service principal, not a user account.

The governance features are a different story. Conditional Access for agents needs a Microsoft Agent 365 licence, through Microsoft 365 E7 or Agent 365 paired with at least Entra P1 or Microsoft 365 E3. Entra ID Governance for agent identities has the same requirement.

The count is per person, not per agent. Agent 365 has a US list price of $15 per user per month, paid yearly. For premium capabilities, license the users who delegate access to agents and the relevant owner, sponsor or manager of agents that use their own access. One person's licence can cover multiple agents. You'll see older articles talking about one licence per agent. That was the preview model.

The one to watch is quieter. Agents can optionally have an agent user account for systems that need a user identity. If you use dynamic groups for licensing, an agent user that lands in one can consume a licence. A rule like "all members" will sweep them in, though admins can add a condition to exclude agent user accounts.

Microsoft now also publishes education prerequisites for Agent 365: Microsoft 365 A5 for Faculty, or the A3 for Faculty route with the Defender and Purview education suites. Confirm the exact combination, education pricing and feature entitlements with your reseller before buying. Don't assume an existing A3 or A5 subscription includes Agent 365 itself.

What to do this week

If you look after a school or trust tenant:

  • Open the Entra admin centre and list your agent identities. You may find more than you expected.
  • Pick one agent and review its connector permissions. Ask whether each one is needed.
  • Check every agent has a named human sponsor who is still in post.
  • Look at the rules on any dynamic groups that assign licences, and exclude agent user accounts.
  • Find out which older agents are still on app registrations and plan their move.

Where leadership comes in

Leaders have a part to play here too.

Your AI policy probably says who can use AI tools. Does it say who can build them? Who signs off an agent before it touches pupil data? Who owns it once it's live? And who pays for governing it?

An agent with its own identity can be held to the same standards as a member of staff. But only if someone writes those standards down.

Who in your school is accountable for the agents already running in your tenant?

Sources & further reading