Draft CUC Code of Governance

The new draft Code of Governance from the Committee of University Chairs arrives at a moment where it feels like university governance has never had a higher profile.

From new conditions of registration, nation specific concerns (viewers in Scotland, of course, have their own programming), ministerial interest, through to rhetorical blasts from trade unions it feels like everyone has an opinion to share on the way universities are run and managed.

And surely – where recruitment is uncertain, finances are perilous, and the popular case against higher education is in the ascendent – university boards have a lot to answer for. In signing off new initiatives, new investments, and new borrowing – and in scrutinising the conduct and quality of senior managers – it looks as if governors may have been asleep at the wheel.

The new draft is for the scheduled replacement of the current (2020) code of governance. CUC aims to review the code every four years or so, but the pandemic has put us out of sync with that pattern. But don’t be confused by the idea of this being an update – the text is almost completely re-written.

For instance, in 2020 we saw six primary elements – accountability, sustainability, reputation, equality (including inclusivity and diversity), effectiveness, and engagement – that embodied that core of what governance is for and needs to be.

But 2026’s framing is much more prescriptive in tone: though to be clear it is on an apply-or-explain basis, recognising that diverse provision requires different approaches. Each of six sections – leadership and purpose, culture and behaviors, strategy (including sustainability, risk, and assurance), board structure and composition, academic governance, board development and performance – includes provisions offered as minimum expectations (must/must not) and occasions where the board needs to use its own judgement (should/should not).

By grouping the code around activities (things that governing bodies do) rather than attributes (things that governing bodies should embody) it immediately feels more directive and easier to police: although CUC will not be auditing compliance itself. The approach actually feels closer to requirements that you could imagine the Office for Students adding to a condition of registration were it able to cut past the autonomy considerations and stop confusing (as it does in new conditions E7, E8, and E9) documentation for reality.

For its part, CUC puts autonomy front and centre in a “foundational principle”:

Higher education institutions are autonomous bodies of fundamental importance to society, advancing knowledge, educating students and contributing to economic, cultural and civic life. […] Although autonomous institutions, they carry significant responsibilities to their stakeholders, to whom demonstrating accountability and transparency is essential to building and maintaining trust. Whilst boards must balance potentially conflicting stakeholder interests, obligations to students will be of central importance in all governance activity.

while a foreword underlines the sector’s commitment to the ownership and development of the code (“the level of engagement reflects the sector’s strong commitment to strengthening and securing government”). It’s clear that these are more comprehensible and demanding requirements than the previous version, and it is to be hoped that this represents providers taking seriously the declining public and government confidence in the way universities are run.

Financial resilience and sustainability are as good a case study here as any. While the 2020 code sprinkles references to financial matters throughout the code in general terms, the 2026 iteration is clear and specific. Boards – in order to comply with the code – must:

• Scrutinise institutional financial performance, including the institution’s income statement and cashflow through forecasts, scenario modelling and stress testing. This should include a range of scenarios and plans in place to address them.
• Be provided with comprehensive, timely and accurate information over financial performance and position, which includes leading indicators and prudent forecasts.
• Scrutinise the institutional financial position, including the institution’s balance sheet and long term financial risks such as estate liabilities, pension exposure and the viability of the capital programme.
• Scrutinise the potential financial impact on the institution of significant change in operations, investments or change programmes.

And above this, we get “should” statements on testing material assumptions, information provision including costs recovery, and a further “must” on stress testing and scenario analysis.

As a board, this is something you could use as a very clear basis to a challenge in areas where current arrangements fall short. As a clerk or in a supporting role, you could imagine checking against these requirements. The sector is not short of advice or thinking on the role of governing bodies, but it has seldom been expressed in such an actionable and above all useful way.