Governing for good: getting university governance right

A bit like teenagers and sex, university governance is one of those activities that many are talking about but far fewer are actually doing. It’s also one of those activities which, if you don’t take sensible precautions, can have significant long term consequences.

I’ve written here before about different aspects of governance including the need to get inside in the black box and the anticipated impact of university governance changes in Scotland (a follow up on this one is overdue). Governance remains a vital issue for the sector and one which every institution has to focus on consistently in order to avoid major problems.

Leicester squared

Very recently we have seen a significant report on its governance crisis from De Montfort University following the highly publicised departure of its former Vice-Chancellor:

The University acknowledges that its governance was inadequate and that the Governing Body did not provide sufficient and robust oversight of the University’s leadership, in particular the Vice-Chancellor. Following the Office for Students’ own investigation, the University and the Office for Students have agreed a number of specific areas where the University’s governance and internal control mechanisms require improvements to strengthen the University’s compliance with the regulatory framework.

The areas where improvement were required included:

  • international travel
  • breaches of the University’s Financial Regulations
  • the management of whistleblowing allegations
  • the independence and rigour of some remuneration decisions
  • scrutiny for the awarding of consultancy agreements to some members of the Governing Body
  • issues around members of the Governing Body, appointments, terms of office and conflict of interests.

In response to these issues, the University prepared a detailed 39 point action plan. This covers every area where improvement was required and sets out at some length plans for many areas of governance including:

  • A more robust governor recruitment process
  • A better process to identify potential conflicts of interest for Governors and Executive Board members and to deal with the issues arising
  • Closer working relationships between the Executive Board and the Board of Governors
  • The need for a document covering all relevant regulatory and legal issues and a review of a wide range of relevant policies and procedures
  • Revision to Instrument and Articles of Government
  • Publication of Executive Board minutes
  • Adoption of an ‘Ethics Code’
  • Following the CUC Remuneration Code
  • A series of steps to rebuild trust with staff and students.

The plan was produced following active intervention from the Office for Students which, perhaps surprisingly, has only produced the briefest of statements itself.

Essentially, the OfS appears to be satisfied with the very detailed action plan and feels no need to go any further with its public pronouncements. It would be interesting to learn more about their reasoning here but no doubt the absence of further public challenge by the OfS is at least some comfort for DMU.

It’s a remarkable set of responses and represents the most far reaching public statement of a plan to address governance failings we’ve seen since the last university governance crisis.

Crises, what crises?

We’ve been here before of course. And where governance goes wrong it can go really badly wrong as some of the examples highlighted below demonstrate:

And to this list we can also add now the recent issues at Swansea University which have resulted in the departure of the Vice-Chancellor among other challenges. In all these cases the situation has been so bad that it has resulted in major press coverage.

These examples show how much a university can suffer when governance goes wrong. Good governance can’t compensate for poor management, but poor governance can seriously hinder a university’s progress and set an institution’s ambitions back years. At the very least a governance-generated crisis can represent a major diversion for university leaders and governors and result in significant lost opportunities.

Getting on the right governance track

Getting governance right remains a critical issue for universities – and is particularly important in a period of significant challenge and regulatory turbulence.

It still seems that many in the sector, including some of those in leadership positions, are sometimes under-informed about governance matters. This is partly because unless you have direct exposure to the operation of a governing body, either as a member or by attending meetings, it can be quite difficult to get a real sense of what is going on. It’s also possibly down to governance never sounding like the most exciting of topics, and that there is a tendency to focus on governance issues and guidelines only when there is a crisis.

Governance is a key element of the regulatory framework and an area in which, as we have seen with the DMU case, the OfS will not hesitate to intervene. In a previous piece I distinguished between Governance with a capital “G” and governance with a lower case “g”. It is undoubtedly true that the language of governance has become more commonplace in managerial discourse. However, the everyday references to governance we often hear in and around university meetings and policy papers are more usually about the normal business of committees and how they work, and the management structures which interact with them. This is governance with a lower case “g”, rather than the Governance which is at the heart of many of the crises referred to earlier. It is, of course, extremely important to get small “g” governance right, and to invest appropriately in the staff and skills needed to maintain an effective committee and internal regulatory system, but that in itself cannot guarantee that Governance (with a big “G”) is all functioning properly. But it does make it more likely that many of the problems which contributed to the kind of crises described above are spotted and tackled before they get out of hand.

No short cuts

Beyond sensible investment in a skilled and capable governance team, institutions have to pay close attention to the Committee of University Chairs Code of Governance. In addition, AdvanceHE has a comprehensive Governance website and publishes regular guidance on Governance matters, as well as running frequent events for members of governing bodies, chairs, and secretaries.

One of AdvanceHE’s predecessors, the LFHE, produced an insightful report a while back which includes the views of governors on key university challenges and the leadership styles required:

Common challenges facing university leaders were described as financial sustainability, student recruitment and the volatile policy environment. Governors placed little, if any, emphasis on several key issues identified in recent studies of the higher education sector in the UK and internationally. For example there was little mention of ethics, the management of reputational risk, sustainable development, offshore campuses and transnational education, partnerships, or diversity-related challenges.

Governing bodies play a critical role in higher education and yet, despite the occasional report such as those mentioned above, they and their activities are little understood, they generally have a very low profile and are usually quite remote from the daily experience of university staff. While there are significant differences between the governing bodies of pre-1992 universities and those established since then – particularly in terms of size, composition and powers – in general the issues and challenges are very similar.

Despite the key role of the Council (or equivalent) of the university, it does seem still to be the case that the vast majority of staff – both academic and professional services – are simply unaware of the role, nature, function, composition, power and meeting arrangements of their institution’s governing body. It’s all just a black box to them. Institutions then, in focusing on governance issues, do need to find ways to be much more open and explicit about how governance works.

There really aren’t any short cuts to effective governance and no alternatives to playing it by the book. Good governance should be an enabler of rather than a block to effective strategy delivery. It’s not straightforward, requires serious intent and a sustained commitment over time but ultimately success has the major advantage of avoiding all of the kind of distracting and damaging crises we have seen at some universities lately.

2 responses to “Governing for good: getting university governance right

  1. Another thoughtful article from Paul. I’d only add one reflection which is the importance of establishing an appropriate Board culture. Weak boards lack the necessary inquisitiveness the role demands. I look for an inherent tension between the executive and board that reflects a commitment to transparent accountability and constructive challenge. Looking at these and other recent instances of governance failings in HE I am struck by how many smack of board capture by the CEO/Executive.

  2. Paul identifies the age-old principal-agent abuse that goes on in the University.

    Andy rightly points the finger at Executive capture of the NEDs who usually have no real understanding of the HE business that they are ultimately responsible for, and to the extent of – in extremis – carrying unlimited personal financial liability, joint and several.

    For an understanding of what the Law says about the role of governors as charity trustees and of how power & authority is distributed within ‘the governance triangle’ see Occasional Paper 64 at the OxCHEPS website.

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