HE: Strategy & Governance Risks & Issues 2020 2/3

30.01.2020

At the beginning of a new year, and indeed a new decade, one of my first priorities was to approach our Halpin Advisory Group and ask them their thoughts on key issues they think Vice-Chancellors, Chairs and COOs will need to think about for the coming year. This group is a senior, experienced and cross-sector one, and their various perspectives are helpful and useful.

We started by discussing political implications for higher education, and the changes we might see from Boris Johnson and Dominic Cummings are summarised in a blog co-authored by Tim Melville Ross and myself – check it out here.

Of course, there are many more issues than politics to consider (although politics affects them all), and this is our second article in a series of three. Here, we focus on governance and the strategic issues and challenges facing universities in the coming years. We’ll wrap up in a third article which will consider marketing and fundraising challenges – keep an eye on social media for that soon.

Income Decline

The lack of financial sustainability is a huge risk to all universities. Student fees now often account for over half of the income of a university (and sometimes a lot more). Recruitment numbers are very unstable due to the creation of a market by the introduction of fees and removal of the numbers cap, allowing some universities to grow while others contract. Add in demographic dips and expansions, a student body who have a wholly different set of expectations compared with the past, and universities who have expanded rapidly and are now finding the student experience falling as a result.

Pensions, salaries and energy costs all feed into this too. In the current climate, risk-averse institutions could experience decline, but those who take big risks that don’t work out could also find themselves in trouble, or worse.

Governance & Remuneration

Sound governance requires organisations to seek out differing views and avoid ‘group think’ from a narrow, “people like me”, perspective. Do universities now have effective boards with clear executive/non-executive role clarification and appropriate holding to account? If those charged with governance are not inclusive and diverse in their membership, they are unlikely to effectively set the right culture and environment for the organisations they seek to lead.

After 8 relatively good years the shoe is starting to pinch, and all the fiscal headroom is committed. Governors must have a clear line of sight to cash and challenge unrealistic growth forecasts which simply mask future deficits. Governance will come under pressure and chairs and senior governors might increasingly be paid.

Equality, Diversity and Inclusion (EDI)

There will be an ever increasing (and highly welcome) focus on EDI, because of the push from regulators, students and staff, but more importantly because it’s the right thing to do. HE’s record in this area is very poor, and significant steps need to be taken to show where your institution is, and what it needs to do in order to look more like the society it is meant to serve.

Social Mobility

It seems that every week a new report comes out to show how poor the UK is at enabling social mobility, whether that is aimed at Russell Group universities, buying property in London, or challenges in the areas of the country that have voted Conservative for the first time. Progress is being made by universities in this area, but expect ever-increasing pressure here from the regulator, government, the media and students.

Recruitment & Retention of staff

The days when HEIs bet the house on REF have receded, and for most institutions we will not see them buying in big research teams wholesale on a regular basis just for the REF. But recruiting and retaining excellent academic and professional services colleagues, especially in the context of Brexit, is going to be increasingly challenging.

There is a concern about the academic pipeline for the future. Are people in their 20s and 30s thinking about academia as a career? Career pathways are unclear and very uncertain. There is a perceived culture of patronage. In non-STEM areas, particularly, it can be an isolated and lonely existence. Funding and employment are fixed-term or short-term. Lack of any security of tenure makes obtaining things like mortgages almost impossible (although that seems to be true for most young people whatever their profession). Consequently, many of the brightest and best choose other paths. Historic easy reliance on a European or overseas workforce is likely to change if the UK post-Brexit is less attractive to good candidates.

Regulation

The English sector must come to terms with the fact that there is now an assertive regulator, which behaves in a very different way to the “partnering” approach of HEFCE. The notion of “co-regulation” is rejected by the OfS. The term should be abandoned by the sector and replaced by a closely argued case for the pursuit of shared (between regulator and regulatees) interests in educational quality and international quality research, both pure and applied.

Industrial action

Concerns on pensions and working conditions don’t have easy solutions, and disputes are likely to remain a feature of the first half of this decade. A number of universities blame strikes on a dip in their NSS scores. Staff say universities are not listening to them and that they have student support. Whatever the truth is, universities had better gear up their resilience to industrial action, and that will not be easy to achieve.

Sustainability & Zero Carbon

Universities have enormous estates, and a significant opportunity to contribute and lead in the “Green New Deal” agenda. However, old buildings are costly to maintain and often not fit for purpose. Is a technology that seems green now going to be found to be part of the problem in 10 years’ time (for which, see diesel cars)? Making the right estates decisions could be a real attraction point for the right places. The opposite is also true.

The challenges are myriad in a highly complex sector, and the solutions can only be worked out in collaborations and partnerships. We work in partnership with universities and we are here to help, in whatever areas of governance and strategy you’re currently wrangling with. We have senior-level experts who are specialists across all areas of university leadership. We understand universities like no other consultancy.

Shaun Horan is Joint CEO of Halpin – the home of experts in higher education.

With grateful thanks to the Halpin Advisory Group for their input:

  • Tim Melville Ross CBE
  • Dame Angela Pedder DBE
  • David Allen OBE
  • Robert Dufton
  • Shakira Martin
  • Richard Taylor
  • Simon Gaskell
Article Name
HE: Strategy & Governance Risks & Issues 2020 2/3
Author
Shaun Horan
Publisher name
Halpin Partnership
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