Corporate Governance In Educational Institutions

Corporate Governance In Educational Institutions

Thursday, October 5, 2017 12:52 pm

Olufemi Mosaku-johnson

By Olufemi Mosaku-johnson

Governance has become a major leverage tool for improving quality in all aspects of education.

This write up will address three kinds of governance arrangements:
• The first type of governance arrangements demonstrates and results from the capacity of institutions to show they can make good use of the autonomy given to them.
• A second type of arrangements aims to help institutions adopt corporate governance in line with the New philosophy.
• The third category of arrangements is a response to protect institutions from fraud or mismanagement by owners, teachers and students.

All categories of governance arrangements address the issue of trust in education.
Governance arrangements and quality guidelines play similar roles in helping institutions become more effective. Governance arrangements clarify institutional structures and procedures, notably toward governing board members. Quality guidelines focus on planning processes and the nurturing of a quality culture.

Most governance arrangements are advisory in nature, which allows the institution to use them in its own way. To some extent, governance arrangements represent a cautious approach to help institutions progress without hampering the diversity of education.
The concept of “governance” is not new. However, it means different things to different people, therefore we have to get our focus right. The actual meaning of the concept depends on the level of governance we are talking about, the goals to be achieved and the approach being followed.

The concept has been around in both political and academic discourse for a long time, referring in a generic sense to the task of running a government, or any other appropriate entity for that matter. In this regard the general definition provided by Webster’s Third New International Dictionary (1986:982) is of some assistance, indicating only that governance is a synonym for government, or “the act or process of governing, specifically authoritative direction and control”. This interpretation specifically focuses on the effectiveness of the executive branch of government.
The working definition used by the British Council, however, emphasises that “governance” is a broader notion than government (and for that matter also related concepts like the state, good government and regime), and goes on to state: “Governance involves interaction between the formal institutions and those in civil society. Governance refers to a process whereby elements in society wield power, authority and influence and enact policies and decisions concerning public life and social upliftment.”

We can apply our minds to the definition of governance provided by the World Bank in Governance: The World Banks Experience, as it has special relevance for the developing world:

“Good governance is epitomized by predictable, open and enlightened policy-making, a bureaucracy imbued with a professional ethos acting in furtherance of the public good, the rule of law, transparent processes, and a strong civil society participating in public affairs. Poor governance (on the other hand) is characterized by arbitrary policy making, unaccountable bureaucracies, unenforced or unjust legal systems, the abuse of executive power, a civil society unengaged in public life, and widespread corruption.”

“Efforts to create an enabling environment and to build capacities will be wasted if the political context is not favourable. Ultimately, better governance requires political renewal. This means a concerted attack on corruption from the highest to lowest level. This can be done by setting a good example, by strengthening accountability, by encouraging public debate, and by nurturing a free press. It also means … fostering grassroots and non-governmental organisations such as farmers’ associations, co-operatives, and women’s groups”.

The contribution of Goran Hyden to bring greater clarity to the concept of governance needs special attention. He elevates governance to an “umbrella concept to define an approach to comparative politics”, an approach that fills analytical gaps left by others. Using a governance approach, he emphasises “the creative potential of politics, especially with the ability of leaders to rise above the existing structure of the ordinary, to change the rules of the game and to inspire others to partake in efforts to move society forward in new and productive directions”.

His views boil down to the following:
• Governance is a conceptual approach that, when fully elaborated, can frame a comparative analysis of macro-politics.
• Governance concerns “big” questions of a “constitutional” nature that establish the rules of political conduct.
• Governance involves creative intervention by political actors to change structures that inhibit the expression of human potential.
• Governance is a rational concept, emphasising the nature of interactions between state and social actors, and among social actors themselves.
• Governance refers to particular types of relationships among political actors: that is, those which are socially sanctioned rather than arbitrary.
To conclude, it is clear that the concept of governance has over the years gained momentum and a wider meaning. Apart from being an instrument of public affairs management, or a gauge of political development, governance has become a useful mechanism to enhance the legitimacy of the public realm. It has also become an analytical framework or approach to comparative politics.

Why governance has become a crucial issue in education
Education has been facing dramatic changes over recent decades, including:
• expansion of education systems:
• diversification of provision: new institution types have emerged, educational offerings within institutions have multiplied and private provision has expanded;
• new modes of delivery: more flexible ways of provision (such as distance learning and e-learning) have been developed.

• more heterogeneous student bodies: female participation has increased and there are more mature students enrolled in higher education. Student bodies are also heterogeneous in terms of socio-economic background, ethnicity and previous education;
• the growing internationalisation of higher education;
• research and innovation are leveraging knowledge production: institutions are making a major contribution to research and innovation by creating new knowledge through scientific and technological research and by training skilled workers through their educational mission.

A number of trends are also evident in education funding arrangements as institutions have been under pressure to diversify their revenues and reduce their dependence on public funding. Firstly, there has been a diversification of funding sources. Secondly, public funding for tertiary education is increasingly characterised by greater targeting of resources, performance-based funding and competitive procedures.
The effects of these challenges on governance are diverse. Institutions of tertiary education, as recipients of public funds, are experiencing new pressures to adjust rapidly, efficiently and fairly to the expanding and changing demands of society and the labour market. A major issue for institutional governance and research funding is to make the latter more relevant to society and the economy.

Paradoxically, institutions are no longer the sole key player in higher education since ―the main change, as far as universities are concerned, is that knowledge production and dissemination – research and teaching – are no longer self-contained, quasi monopolistic activities, carried out in relative institutional isolation. Today universities are only one amongst many actors involved in the production of knowledge.‖ (Gibbons, 1998).

International rankings have added to the pressure on university governance. Salmi links high-ranking universities to three connected factors: concentration of talent, abundant funding and appropriate governance (Salmi, 2009). Autonomy that allows institutions to manage their resources capably and to quickly respond to the demands of a rapidly changing global market is essential, though not alone sufficient to establish and maintain world-class universities. Other crucial governance features are needed, such as inspiring and persistent leaders, a strong strategic vision of institutional direction, a philosophy of success and excellence and a culture of constant reflection, organisational learning and change.
Why quality is linked to governance issues

Increasing accountability
Accountability is an increasingly important element in the governance of tertiary education systems. Within the context of publicly funded tertiary education systems, the demonstration of ―value for money‖ or of ―responsible and relevant activities undertaken with the taxpayers‘ money‖ is now widespread in most countries. This trend towards greater transparency and public accountability is developing parallel to the move towards greater autonomy. It reflects the recognition that there is a public interest in tertiary education which needs to be reconciled with the benefits that institutional autonomy can bring. Public interest should be sustained in the areas of guaranteeing academic quality and standards, ensuring equitable student admission procedures and accessibility for students from poorer families, and ensuring an appropriate use of public funds within institutions (i.e. internal efficiency).
Accountability can be ensured through various means, including quality assurance frameworks, performance-related funding, market mechanisms and participation of external stakeholders in governing bodies (where external representatives would advise and support the institution regarding its contribution to society, and information on institutional results would be provided to the public).

Protecting consumers
There is growing acceptance that learners need to be protected from the risks of misinformation and low-quality provision, abuse in emotional, psychological and sexual forms and that quality improvement needs to be built into the system.

The following Governance Instruments will enable educational institutions to function properly viz,
• planning and policy leadership;
• structure and governance;
• financing, resource allocation and subsidies;
• incentives (monetary and non-monetary);
• information (e.g. communication and reporting);
• laws, ordinances, decrees and soft law; and
• modes and processes of policy implementation.

The school systems both public and private should be governed by Board of Directors with a mandate to lead and perform oversight functions on the institutions. No school should be run on the whims and caprices of the owner be it individual owner or the government. To this end good governance will result and all the stakeholder will benefit enormously.


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