Best practices on corporate governance of higher education

1. Professor Benon C Basheka, PhD
Dean, School of Business and
Management
Uganda Technology and Management
University (UTAMU)

2.  A university (or any HEI) is complex in terms
of people, processes, structures and
systems.
 Universities are no longer regarded as “ivory
towers”- they are now increasingly
challenged to show why they exist
 Universities are now regarded as enterprises
that produce and distribute a public good-
which is knowledge

3.  Universities now operate in a globalised
environment and this has expectations on the
way managers and leaders run these enterprises
 Serious problems (internally and externally
generated) confront managers and leaders of
Universities
 Solutions that worked yesterday may now not
work today and tomorrow due to the complexity
of changes

4.  Universities are now walking on a tight rope:-
•Increasing demands from both internal and external
stakeholders
•Limited funding but they are expected to do
more with less
•Serious diversity challenges are seriously
undermining the true essence of a
university
•Students increasingly want their participation in
university management –a fact that challenges the role
of university leaders and managers

5.  Academic leaders and managers are on the
‘spot’ and challenged to be more inspirational
and provide direction in advancing the
‘corporate strategy’ of Universities
 Issues of relevance and employability of
university graduates continue to be thorny
issues
 Unresponsiveness of university systems and
processes to the changing realities

6.  Dichotomy between public and private
universities seem to be increasing and even
within each there are groupings
 The exact role of governing councils are being
questioned within the university set up
 Debates also exist on the relationship between
universities and NCHE given the long held
traditions of university autonomy

7.  Role of students in governance of universities
 Staff associations and their increased
‘activism’ are key fundamental governance
issues
 Non-payment and financing issues have
become perennial issues for discussion
whenever higher education experts meet

8. S. Asiimwe and G.M. Steyn (2013) found the
following Obstacles faced by universities in Uganda:-
•Internal politics
•Lack of commitment
•Bureaucracy in management
•Conflicting values in the institution
•Centralisation of authority and decision-making
•Insufficient financing to implement decisions
•Financing higher education
•Insufficient remuneration and low morale
•Globalisation and increased competition

9.  All these issues point to a poor corporate
governance culture and some ‘crisis’.
 Over time, application of private sector styles to
promoting efficiency and effectiveness in
university governance have been recommended
 Does it mean private universities are better
governed in Uganda than public universities?
 Let us put our debate in context

10.  The state had a central role in the delivery of
public services (higher education inclusive)
 The concept of administration occupied a
central position as opposed to management
 The distinction between public and private
sector organizations was not emphasized
 Institutions were based on structures and
extensively in rules and regulations

11.  The state was diagnosed to be part of the
‘problem’ in delivery of public services
 The state was argued to be too big, inefficient,
bureaucratic, ineffective, and corrupt
 Public administration was blamed for the crisis
 A solution had to be quickly identified

12.  Many economic and political reforms
were instituted and the higher education sector
was a beneficiary of such reforms
 The distinction between public and private
sector now became clear
 Public sector was the problem and private
sector was the solution

13.  The introduction of private-sector styles of
management in running of government
activities became the key strategy
 The word management became widely used
and administration almost disappeared
 There was preference for business
administration graduates instead of public
administration graduates

14.  Traditional administrative practices were
replaced with business-like styles of
management practices
 Emergence of new modes of service delivery
like:-
•Decentralization of service delivery (NCHE
being created)
•Public-private partnerships
•Outsourcing
•Contracting out
•User charges and cost sharing arrangements
•Performance- based Contracts

15.  Reinventing
 Re-engineering
 Retooling
 Reform
 Total quality management
 Result oriented management
 Performance based systems
 Contract-based employment

16. •The question on who should be involved in
service delivery
 The Government
 The Private sector
 The third sector
 The citizens
 The media
 The development partners
 The church
 Cultural institutions

17.  Good and Bad governance
 Local governance
 Corporate governance
 Global governance
 Procurement governance
 Judicial governance
 University Governance
 Environmental governance
 Health governance

18.  Expected to apply the corporate governance
principles and practices
 Expected to exercise the highest degree of
efficiency and effectiveness given the
prescription that had been given just like
elsewhere: Liberalize, Private and Stabilize
 Managers were supposed to be allowed to
manage but under stringent performance
frameworks

19.  As Hoare (1995:41) noted, universities must
recognize they have important differences from
other public and private sector enterprises-they
need to maintain autonomy and protect and
enhance academic freedom of staff.
 Universities, represent several professions which
make it even harder to get cohesion in a set of
goals.

20.  The commonly agreed elements of good
governance in any organization apply to
universities:
•Accountability
•Transparency
•Efficiency
•Equity
•Participation, and
•Effectiveness

21.  How should universities relate to NCHE and what
exactly is the mandate of NCHE visa vis that of
universities in Uganda?
 What level of autonomy should universities have
visa vis the legal requirements of NCHE and
their mandate?
 What should be the exact size and composition
of [university] councils?

22.  How should different constituencies be
represented on key governance structures at
university level but also at NCHE?
 How should universities be financed amidst
declining government funding?
 What should be the key roles of university
councils and board of trustees?
 Should the ministry of education officials be
represented in universities councils and
governing bodies?

24.  Corporate Governance, it means the system of
rules, practices and processes by which a
university [company] is directed and controlled.
 It involves balancing the interests of the many
internal stakeholders in a university [company]
– like its shareholders, management, staffs,
students and a variety of external stakeholders
like customers, regulators, suppliers, financiers,
government and the community.

25.  Governance is “the process for distributing
authority, power and influence for academic
decisions among campus constituencies
•The board of trustees
•Faculty
•Students
•Staff
•Administrators
•The academic or education council/senate, and unions
•Committees and sub-committees that include these
representatives may also play a role.

26.  Council/Board of trustees: Supreme organ
(final authority);
 Vice-chancellor/Rector: holds delegated
authority with his team of administrators;
 Faculty: Creators of new knowledge. In
practice, faculty is supreme in academic
matters such as curriculum, appointment of
academic staff, admission requirements, etc.;

27.  Students: Key partners in the university,
variously described as consumers or
customers in the academic enterprise;
 Unions: Sometimes referred to as network
leaders; and
 Non-academic staff, particularly senior
administrative and professional staff.

28.  Work with NCHE on a variety of functions
 NCHE mandate is
•To regulate higher education, and to guide the
establishment of institutions of higher learning as well
as ensure that quality and relevant education is
delivered
 NCHE has its structures through which it
operates

29.  The Council consists of eighteen persons, the
majority of whom are representatives of
various social constituencies including:-
•Public and private universities
•Religious organizations, commerce, industry,
agriculture
•The general public
•The Ministry of Education
•People with disabilities.

30.  Chairperson appointed by the president
 Vice Chairperson elected by the Council
member
 Two Representative of Vice-Chancellors of
Public and private Universities.
 Two Senates Representative Private and public
Universities

31.  Four Representative of religious non-degree
awarding institutions appointed by the Minister
of Education
 Three Representative from Commerce,
industry and agricultural Sector
 Four members of other sectors of higher
education

32.  One Representative of the public elected by
the Council
 One Representative of people with disabilities
 An officer in charge of Higher Education,
Ministry of Education and Sports
 Two Representatives of Students from
Tertiary and Universities
 Executive Director, National Council for Higher
Education

33.  Two views exist on this subject
•Those that argue for small governing bodies in
universities place an emphasis on what appears to
produce efficient and effective corporate practices.
•But what a small governing body may not do well is to
permit more participatory or cooperative forms of
decision-making and allow for stakeholder
representation where there are multiple
accountabilities.

34.  Historical forces lead to relatively large
governing bodies of universities
 Uniqueness of universities needing mechanisms
for protecting academic independence
 Finding an appropriate balance between
external and internal members

35.  “capture” by members internal to the university
when they have a significant proportion of total
membership?
 Coaldrake (1998:171) claims that some
governing bodies are indeed captured by the
self-interests of inside members.

36.  Clarifying the university’s mission and purpose
 Appointing, supporting, and monitoring the chief
executive’s performance
 Assessing the university’s development and
progress as a HEI
 Participating in strategic planning
 Reviewing educational and public service
programmes

37.  Ensuring adequate resources and ensuring
good management
 Preserving institutional independence within
the confines of the system
 Relating campus to community and community
to campus; and
 Serving as a court of appeal.

38.  A: Rubber-stamp Council-
•Brings no additionality to the university and is thus
amenable to whatever strategy or programme is
submitted for its approval.
•Enormous responsibility and power are placed in the
hands of the vice chancellor or on one council
member.
•In the worst-case scenario, rubber-stamp councils,
which do not act as a check and balance, leave the
university vulnerable to mismanagement and fraud.

39. •Open doors for the university that would otherwise
remain closed or hard to open. A representational council
member might improve the university’s ability to establish
key linkages.
•Increase the university’s access to information outside its
direct area of operations and enhance its national and
international exposure.
•Maintain necessary oversight in part to ensure that their
names and reputations are not damaged by their
association with a poorly performing university.
B: Representational Council

40.  Raise issues that are at the core of the proper
functioning of the university and will not be
distracted by peripheral or semi-peripheral
concerns.
 Engage in more constructive and challenging
discourse with management and provide the
type of useful analysis that enables
management to pursue increasingly higher
levels of performance.

41.  Accompany good management and, if
necessary, take the lead in defining the overall
strategy of the university and work closely with
management in overseeing its implementation.
 Understand the difference between its strategy-
based role and the operational responsibilities
of management.
 Be more likely to identify quickly and effectively
shortcomings in the council’s functioning and
seek to address them.

42.  A multi-type council includes members who
play a representational role and those who
are well-informed about the operations of the
university and have solid expertise, here
termed hands-on.

43.  University experience. Including
individuals in the council with experience in
the area of management of universities, or
who have held senior academic positions, can
be very valuable to the university.
 Business sense. A council must have solid
business sense, with some financial expertise.

44.  Legal expertise. All universities will benefit
from individual members who bring legal
expertise to their councils.
 Project planning. With increasing numbers
of students and growing campuses, universities
need individuals who can assist in drawing up
development plans for them that maximise the
use of existing resources.

45.  Public relations. Universities must be
concerned with the image they project to the
clients and to the public at large and must be
able to conduct outreach campaigns.
 Fundraising. Council members are expected
to play an active role in fundraising and
proposal writing. Individuals with prior
experience and contacts represent a significant
asset.

46.  Demographics. Universities that operate
nationally may select members to represent
different regions.
•Moreover, those that operate across national borders
should endeavour to have a council member from the
places as well.
•These members might contribute to broadening the
perspective of the council.

47.  Executive and staff members. The vice
chancellor is often a member of the council
and other senior management teams (SMTs).
•Consensus exists among governance experts, however,
that for adequate oversight, the number of SMT
members serving on a council should be limited.
 Staff/student participation. The risk that
arises when staff and/or student
representatives sit on the councils of
universities is that their presence may become
one of form rather than substance.

48.  Unicameral Governance –governed by a single
governing body responsible for both administrative and
academic matters (Mount Royal College, 2005).
 Bicameral Governance - governed by two
legislative bodies: i) a governing board and (ii) a senate
or a university/educational council
 Tri-cameral Governance– governed by three
legislative bodies
a governing board a senate iii) a(n)
university/educational council
 Hybrid Governance
 Shale (2002) defines hybrid governance as a blend of
governance, usually unicameral (board or a
faculty/academic council or a faculty council established
by academic council).

49.  Political influence
 Strict government regulations, policies, and
laws
 Pressure from
shareholders/stockholders/stakeholders
 Financial constraints
 Conflict of interest
 Little knowledge about the law among many
board members

50.  Limited access to vital information
 Lack of appropriate skills
 Little commitment by some boards and/or
board members
 Disagreements between the board team and
the chief executive officer
 Little ability to cope with change
 Lack of consensus
 Reputation risk
 Duo position

51.  Responsibility for the failures of the corporation
 Lack of alignment of board and management
 Over- emphasis on financial matters
 Pre-determined board decisions/judgment
 Insubordination
 Subject to public scrutiny / loss of privacy/
declaration of wealth

52.  Boards are expensive to maintain
 Detached from the people they represent
 CEO doubling as the board chair
 Worsening levels of corruption

53.  What organizational architecture is needed to
address the challenges?-the architecture
question
 What values are needed to transform
universities?-the values question

54.  What qualities will be needed of leaders and
managers to be able to foster meaningful
dialogue between the various segments of
the community and university?-the quality
question
 How should university leaders and managers
be accountable? The accountability
question

55.  The Image of a university or any institution is
determined by the caliber of leaders and
managers
 The linkage between universities and NCHE is
clear and each needs to do their roles
 The environment of managing of yesterday is
not the environment of today and tomorrow

56.  Need to continuously empower councils and
boards on best practices will save the crises
that often come associated with most
institutions
 Members of councils need to be given clear
terms of reference and their performance
should annually or quarterly be assessed on
agreed benchmarks

57.  I cannot give you the formula for success, but I
can give you the formula for failure: which is:
Try to please everybody (Herbert B. Swope)
 The task of leadership is not to put greatness
into people, but to elicit it, for the greatness is
there already (John Buchan)

58.  The best executive is the one who has sense
enough to pick good men to do what he wants
done, and self-restraint to keep from meddling
with them while they do it (Theodore
Roosevelt)