Governance News Alert: Governance Conference 2025

This year's conference explored practical applications of governance with special emphasis on navigating the rapidly evolving landscape, financial sustainability, board effectiveness, digital innovation and inclusive decision-making practices. Keynote addresses were delivered by The Rt Hon Baroness Smith of Malvern , Minister of State (Minister for Skills) and Minister of State (Minister for Women and Equalities) , and Professor Edward Peck CBE, Chair of the Office for Students.  Panel speakers included Professor Malcolm Press CBE, President of Universities UK (UUK), Professor Cara Aitchison, Chair of the Scottish Funding Council (SFC) and Mary Curnock Cook, Chair of the Governing Body at the Dyson Institute of Engineering and Technology, NED at the London Interdisciplinary School and Council member at the University of Leicester, and representatives from the Committee of University Chairs (CUC). Delegates attended a number of workshops including those focussing on transforming HE governance, governing in the age of AI, new models of governance and the Organisational Efficiency Maturity Assessment (OEMA) developed in the wake of the UUK blueprint. This year’s conference was delivered with collaboration between sector partners delivering the breakout workshops, supported by the Association of Higher Education Professionals (AHEP), the Association of Heads of University Administration (AHUA), GuildHE and Independent Higher Education (IHE). 

 

At-a-glance:

• The post 16 Education and Skills White Paper, sets out a “clear direction for higher education”, one that “unequivocally supports economic growth in the courses that it runs and the partnerships that it pursues” and delivers for students, taxpayers, workers and the economy. But this will not be achieved if leaders “keep their heads down and stay in their lanes or focus on competing to attract a limited group of learners”. Collaboration between and within HE and FE “must become the norm, not the exception” (Jacqui Smith) 

   

• The OfS has identified problems in board financial oversight. Leaders across the sector must act now to bring their institutions onto a better financial footing and ensure they have the right skills around the table to manage risk. Financial Planning based on long term optimism, as has been seen in the past, is not good enough (JS)

   

• The government is committed to increasing undergraduate tuition fee caps in line with inflation and to reform research funding to improve cost recovery. This must be matched by strong, strategic governance driven by sector institutions that plan for the long term and reform their business models to make them financially sustainable (JS)

   

• No organisation should feel entitled to waste public funds on low value provision. It is too often the case that franchising arrangements are delivered ineffectively and without clear educational rationale. However, partnering with other institutions can “reduce duplication and ensure that no discipline is left behind”. The government will work to reduce the cultural and regulatory barriers that stand in the way of new well managed collaboration models (JS)

   

• An SFC analysis of governance reviews found lessons to be learned around the difference between development and assurance: governors are spending a lot of time talking about what they plan to do and develop, rather than actually assuring themselves that things that should be done were being done (Professor Cara Aitchison)

   

• Governing bodies need to spend more time considering risk in depth and paying attention to benchmarking data. Where an institution is an outlier and how it measures up relative to its peers can provide early warning signs that need to be addressed. But transformation requires investment of finance and time. It is not simply about cutting costs: it must involve thinking about strategy (CA)

   

• Recent failures of governance in the HE sector have their roots in challenges around capability and culture. The latter is much more difficult to codify. Reasons for things going wrong include “obfuscation of the truth”, lack of test and challenge and poor risk management. Governors should be involved in genuine co-creation of strategy, devising KPIs and holding the executive to account (Professor Malcolm Peck)

   

• Governing bodies of 20 people are too large to facilitate meaningful discussion - it tends to make governance very “performative”. Ten to 12 people can ensure the right range of skills and that meaningful discussion can take place. A majority of board members should have board level experience (Mary Curnock Cook, independent education expert and chair of Dyson Institute)

   

• The subcommittee structure works well, but there needs to be a high level of trust and confidence, and very clear delegation to avoid the need to duplicate discussions again at full board. Sub committees can fall into the same traps as boards eg being overwhelmed by long, detailed papers (MCC)

   

• Boards rarely have unconstrained discussion about strategic issues. When strategic issues are discussed, boards too often lapse into passive mode, “accepting what's put in front of them”, rather than spending time understanding or considering alternative solutions for the issue at hand (MCC)

   

• Delegates taking part in a workshop were encouraged to consider the benefits of joining collaborative groupings of HE and FE institutions. These included significant savings on senior management, removing duplication of curriculum and services, shared services, quality assurance by viewing different provision through the same quality lens, providing a single point of contact for stakeholders, and managing the peaks and troughs of money flows giving financial stability

   

• Institutions are only just beginning to approach AI strategically and many governors feel behind the curve on the debate. Northumbria and the LSE have invested in Claude - an AI platform specifically tailored for higher education, while De Montfort University is in the early stages of developing an institution-wide AI policy (main points from AI in HE workshop)

   

• In working with over 70 organisations, analysing governance reviews and exploring insights from the Big Conversation project, Advance HE has identified in a report 10 important themes around governance. These include board composition and diversity, assessing risk, agile decision making, harnessing technology, governor development, transparency, engaging stakeholders, the relationship between corporate and academic governance, demonstrating regulatory compliance, and collaboration and renumeration (Aaron Porter, Advance HE Associate Director)

• Evidence collected by the Committee of University Chairs (CUC) code review steering group has exposed frustrations felt by vice chancellors and governing body chairs. Secretaries felt they had a hard job reconciling the two positions.Some said they did not feel able to meet with the Chair without the VC. (Iain Cornish, Chair of the Code Review Steering Group and Chair of the Board at Leeds Beckett University)

   

• In response, the code will aim to be much clearer and precise about the specific responsibilities attached to different roles within the governance universe. Themes that came up consistently include how boards exercise academic oversight, how they engage with strategic decision making, financial stability issues and risk and control. The new code will be principles-based, short, accessible and straightforward, designed to “provoke institutions into thinking and acting”. The CUC review heard from students and staff that they feel constrained from speaking up in the boardroom, even when they believe that what they are hearing is not true (IC) 

   

• Professor Edward Peck, Chair of the OfS and former VC of Nottingham Trent University, said he has been “quite surprised” since taking up his post, that some institutions had failed to get ahead of the financial challenges that they should have seen coming. Others had predicted they would not meet their targets but had no plan for what to do about it (Professor Edward Peck)

   

• Given the growth in franchising over the last five years, and arrangements varying from “the careless to the negligent”, what are governing bodies doing about them, Professor Peck asked. Despite boards having members with commercial and financial expertise, there was “something about the environment” stopping them exercising their professional skill, he added (EP)

   

• Professor Peck suggested that the OfS should shift its focus of attention from the accountable officer to the board of governors itself, since the board is actually the accountable body. A shift away from the AO to the board could empower chairs to “see themselves as central to the activity of the organisation”. He added that remuneration for board chairs and audit chairs would bolster their sense of authority (EP)
  
   
• Summing up the day Advance HE Chief Executive Alistair Jarvis said it had been interesting to hear the Minister signal a clear political interest in governance, saying she expects governing bodies to be bold. It was also notable that the OfS had indicated it wanted to be more engaged with chairs and governing bodies.

Implications for governance:

A key message from this year’s conference was that the expectations around governance are changing significantly. Comments made by the government’s skills minister and the chair of the OfS make it clear that boards will face an even greater focus on how they are carrying out their duties, meeting their regulatory requirements and navigating their institutions through difficult and often unpredictable terrain. 

As Iain Cornish, Chair of the CUC Code Review Steering Group, puts it, the expectations on boards are “formidable and rising” and the drive is for a “significant recalibration of governance”.

Some of the emerging challenges which governors may wish to consider are set out in an Advance HE report on its Big Conversation: ‘Shaping the Future of HE Governance’ project, outlined at the event by Aaron Porter, Advance HE Associate Director.

A concern raised by a number of speakers was that boards are too big to facilitate meaningful discussion. It was suggested that in such an environment, the professional skills of some members, often brought in specifically for their financial, legal or corporate expertise, was failing to land. 

A question was also posed about whether elected members can feel duty-bound to represent the constituency which elected them rather than work in the best interest of the institution.  But alternative evidence suggested that even when elected staff and students are clear that they are not on boards to be representatives, they are treated by other governors as if they were, and not invited to contribute on some matters or felt unable to speak up.

According to Edward Peck, the OfS Chair, higher education providers have not generally paid sufficient attention to governance. For UUK President,   Malcom Press, boards who struggle invariably have issues with some element of their culture and/or capability. For him, these elements are more important than considerations of board size or frequency of meetings.

Insights from Professor Cara Aitchison, Chair of the SFC, on the challenges that faced Dundee University will also be of interest to governors. She warned that transformation programmes are not simply about saving money but require “investment of finance and time”. Governors interested in the SFC’s subsequent report on its “Expectations of Good Governance” may wish to read Advance HE’s news alert on that.

One conference workshop exploring new models of governance considered the benefits of being part of an institutional group, at a time when there is growing emphasis on collaboration between HE and FE as well as universities.

A second timely workshop explored how far institutions were along the path of developing over-arching AI policies. Delegates suggested the answer was not very far: although a small number are forging ahead.

Culture - generally meaning the relationship between the board and the executive and within the board – is a crucial but often intangible ingredient in board success, the conference heard. The reviewed CUC Code of Higher Education Governance, due out next year, will aim to define the specific responsibilities attached to different roles within the governance universe, which may help minimise misunderstandings and/or frustrations.

As boards await the refreshed CUC code, they will be aware that the expectations on them are growing, necessitating the need for changes, perhaps of the radical kind. But the story so far is not one of failure, despite the headlines.

“We should not talk ourselves into a doom spiral,” warns Professor Press, UUK President. “Yes, we need to reform governance, but we are not talking about a sector that is on its knees. I think it is really important to say that.”