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HBOS & London Met: case studies in governance

This article was previously published on the Leadership Foundation website.

Michael Shattock suggests there are potential parallels to be drawn between the findings of a recent report by the Parliamentary Commission on Banking Standards and the governance of post-92 universities. The Commission's Report on the failure of HBOS offers a damning indictment of the failure of the company's board to challenge the strategy and actions of the Executive. Shattock suggests that post-92 institutions run similar risks, citing the example of London Metropolitan University as a case in point. By contrast, Shattock suggests, the greater representation of academic staff on governing bodies and the power of Senate in pre-92 universities offers greater opportunity to identify and prevent risk. He cites as evidence the decision by the University of Warwick's senate in 2003 to vote down a proposal to open a campus in the Singapore despite the proposal being approved by the governing body.

Issues raised for governors and governing bodies

Shattock suggests that post-92 institutions can reduce the risk of endorsing inappropriate proposals made by the Executive by ensuring the governing body's membership includes governors with senior level higher education experience.

Roger Brown while accepting Shattock's suggested solution in terms of the membership of governing bodies of post-92 institutions has value, believes that their model of governance needs fundamental reform.

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