Good governance – what could the Office for Students’ ‘conversation with the sector’ on governance usefully explore?

In November, I chaired a thought-provoking panel debate at The Festival of Higher Education titled ‘Leadership and governance to steward HE through challenging times’. The session, supported by the AHUA, included an excellent panel of speakers: Philippa Pickford, Director of Regulation, Office for Students; Professor Mark E. Smith CBE, Vice-Chancellor of the University of Southampton and Chair of Advance HE; and Seamus Gillen, Director, Value Alpha Ltd and an associate of the AHUA working on university governance.

A wide-ranging discussion explored what’s needed in terms of university leadership and governance to steer universities through challenging times. We considered the role of good governance in supporting the difficult decisions that institutional leaders and Boards are making that will determine the future shape and activity of the higher education sector. The panel examined governors’ ability to oversee transformation and change, take evidence-based strategic decisions, and balance the dual needs of risk management and entrepreneurial risk-taking. We considered the mix of skills, experience and values, the culture and the processes that best enable good governance in challenging times.

Whilst the primary current focus of the Office for Students (OfS) is on financial sustainability, they have made clear that they will start ‘a conversation with the sector’ on governance, expected during 2025, signalling a growing interest from the OfS in how our universities are governed. Although there is a fair question about bandwidth, I believe that it is reasonable for the primary regulator for universities to have an interest in good governance. It is also necessary and important for universities to regularly review and evolve their governance arrangements. As the context and issues change, university governance also needs to adapt to meet new challenges. Just because governance arrangements were suitable and effective in the past shouldn’t lead to the conclusion that ‘no change’ is needed.

Chairing this debate led me to ponder what the OfS’ ‘conversation with the sector’ on governance could usefully explore. I’ve outlined below eight issues that I suggest would be pertinent to consider. These issues are not mutually exclusive, however, all are important if governing bodies are to successfully support universities to navigate challenging times.

• When looking at examples of good governance what behaviours do you commonly see? What are the enablers of good governance e.g. transparency; understanding of regulatory context; clarity of mission; understanding of what is in the best interests of students. Are there processes, mechanisms, and development programmes that can support these enables of good governance?

• What can be done to maximise the time that governing bodies spend on discussion of strategy, strategic issues and oversight on major risk – and minimum time spent on processing bureaucracy? How can the OfS play a role in supporting institutions to get the balance right? Since the creation of OfS, there has been a significant change in what university governing bodies are spending time on. There are now far more items that formally have governing body oversight or sign-off, so more time is spent on items that are necessary to meet regulatory requirements. How can this be done most efficiently whilst maintaining appropriate oversight?

• How can governing bodies be supported to get the right balance between the speed of decision-making and ensuring good governance oversight? Are there examples or mechanisms that can better enable governing bodies to support change, effectively balancing the need to manage risk with the desire to be agile, innovative and entrepreneurial? Are there models of risk-based governance that universities can learn from?

• What are the experience and skills needed in governors to steer institutions through current challenging, financially constrained times? Are there any common gaps in experience? Are the specific types of experience that are particularly valued by universities facing a financial challenge or going through a period of significant transformation?

• What examples of good governance at universities – including processes and behaviour –  can be highlighted and shared regarding common but higher-risk scenarios? E.g. new major international ventures; cost-cutting; closure of departments; high-cost infrastructure projects; and transformational change.

•  Are governing bodies receiving the quality of information necessary to support oversight, management of major risks and strategic decision-making? What does ‘good’ look like?

• What works in terms of recruitment and succession planning for governors, particularly for chairs of Boards? How can universities best attract people with the right mix of skills and experience to non-exec roles? What are the pros and cons of the remuneration of governors?

• What is the optimum size and composition of governing bodies? It would be useful to map out the current range of compositions, identifying strengths and weaknesses of these.

For all of the above, I suggest that an exploration of good practices from other sectors would be helpful. There is much that universities could learn from other organisations.

I’ve three final reflections that I’d urge the OfS to consider as they commence their conversation with the sector:

• In considering issues of governance, I’d recommend starting with an acknowledgement that there is no ‘right’ or ‘one-size-fits-all-all’ approach. Diversity and difference exist and this is appropriate. There is good practice that should be shared, even celebrated. There are also weaknesses which should be the focus for improvement. However, it is appropriate that different universities with a diversity of missions and scales will need differing governance arrangements. OfS’s approach should not be narrowly prescriptive

• It would be helpful if the role of the OfS in supporting good governance was part of the conversation. What role should regulators play in good governance and leadership? How can the OfS best play an effective role in improving governance at universities? What should be the OfS’ role in highlighting concerns, setting expectations and ensuring that action is taken where improvement is needed? I suggest that the OfS’s concerns should be with those examples of genuinely poor governance that need addressing and in supporting the sharing of the best practices to stimulate enhancements in governance.

• There are organisations with a significant depth and breadth of expertise in university governance and with experience providing guidance and supporting improvement. The Association of Heads of University Administration (AHUA), the Council of University Chairs (CUC), Advance HE (AHE) and Universities UK (UK) all have an important contribution to make to this conversation.

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