The challenge for governance in the future: effective decision-making

John Rushforth considers three themes to uncover and test governing body decision-making effectiveness ahead of the discussion at our next Big Conversation workshop, in partnership with UUK.

The UK has a world-class HE system, which suggests that the governance arrangements underpinning it have been consistently effective. There will be examples of a variation of practices in a large, diverse system, but there is a broad consensus across the sector that there may be a need for change.  

The environment has changed, and significant challenges lie ahead with continuing financial pressures, increasing complexity, possible global disruption, and societal change set to continue. So, governing bodies have to consider whether their arrangements will be fit for purpose in the future and whether they will enable strategic, forward-thinking leadership, whether their systems and behaviours will prioritise process over outcomes, discussion over action, and caution over courage.  

There are different perceptions of HE governance in the UK. Some critics suggest that critical decisions take months or even years to materialise, whilst institutions point to the rapid responses to the Covid pandemic as demonstrating that when it is needed, fast decision-making is perfectly possible.  

Others question why outdated models persist despite the clear evidence of their failure in other settings. For example, why do we have governing bodies in universities with over 20 members, when it’s alleged that good practice suggests fewer than 10 is more effective? A response is that universities are not like corporate organisations in that there is a need for a more diverse set of voices and greater deliberation to make good decisions, rather than quick ones. There is little evidence in these areas, but debate continues about whether governing bodies remain reactive, defensive, and hesitant or are composed of high-quality individuals leading with vision, strategy, and agility. 

Structural failure: bureaucracy masquerading as leadership

Governing bodies pride themselves on order, process and procedure, but the risk is that this structure can breed inefficiency rather than effectiveness. To mitigate against structural inertia means that governing bodies need to ask themselves a range of questions: 

• Paralysis by process– are governance arrangements supporting agile decision-making or mechanisms for avoiding accountability?Do processes enable a diverse set of stakeholders to engage?
• Committee overload– do governing bodies leverage specialised expertise through specialist committees? Do governing bodies avoid duplication of committee work to free up the governing body for strategic discussion?Are committees just holding spaces for discussions, partly generated by a bureaucratic overload, and how might we rethink the roles and responsibilities of the university governance system to add more value?
• The use of data– to what extent are the governing bodies making evidence-based decisions, and using robust data analysis? How many governing bodies (or their nominating committees) consider data competency when considering their skills matrices? Have any actively sought input from data scientists to help them utilise universities’ mountains of data?
• Accountability deflection– when failures occur, what are the learning loops to enable change in thinking and mindsets and agile responses to initiate a change in decision, or mitigations to be implemented? Furthermore, is there clarity about responsibility, and how do those who are responsible and accountable understand impact and consequences? Committees can be part of the issue here, since Committee decisions can mean that accountability is diffuse rather than attributed to individuals.Do governing bodies and executive teams collectively recognise that structure without adaptability is a liability? Without a structural review, they risk prioritising process over progress.

Cultural dysfunction: a system designed to preserve, not innovate

The governance culture is often one of caution, hierarchy and risk aversion. Indeed, one commentator has described HE’s governing bodies as “recklessly prudent”. Leaders have a choice about where on the spectrum they work, and that boundary needs constant evaluation depending on the internal and external environment.  For example: 

• full transparency of working rather than working behind closed doors.
• inclusive and challenging debate, and not avoiding difficult discussions.
• embracing change and innovation rather than being risk-averse and defaulting to the status quo.
• considering changing the governance systems or accepting the status quo.

 Some key questions related to governing body culture are:  

• The reality of transparency– is openness truly embraced? How easy is it to find out what governing body will discuss, and what was said – some discussions are commercially sensitive but has the governing body considered the practice of some institutions to ensure a Chair’s blog is released which gives a clear view of the sort of discussions that are taking place, or having an open annual general meeting where stakeholders are invited to ask questions – could an institution go as far as the NHS with public admission and/or live streaming of the non-confidential elements of debate or a post meeting update from the Chair with a Q&A, particularly after a strategy away day?
• Consensus– does “building agreement” lead to better decisions, or just watered-down compromises that satisfy no-one? Do papers encourage debate, or is the governing body regularly presented with a description of what has happened, with a request for approval? To what extent does the governing body measure its value to the institution?
• Ethics– are ethical concerns genuinely addressed or strategically ignored, for example, when the articulated values of the institutions are at odds with the values of potential overseas partners, or when decisions are made with a narrow lens on the topic and not the wider implications for the institution’s values and ethics?
• Adaptability and agency– do governing bodies evolve, or do they lack agency and feel constrained by Royal Charters and Articles, which are perceived as difficult to change?

The UK Financial Reporting Council defines culture as the habitual behaviours and mindsets characterising an organisation. It determines whether governing bodies lead or follow, and if governance culture is ineffective, it inhibits the added value that governing bodies can bring and their ability to add value and adapt to the needs of the sector and the organisation. 

Skill gaps: the competence needed in the future

• It is not enough to have governing structures and positive cultural intent. Decision-makers must also be equipped with the skills to navigate complexity, cope with change, anticipate challenges, and lead with conviction.Is there a lack of critical thinking? Are governing body members genuinely skilled in analysis, or do they rely on outdated assumptions and experiences connected to their own time as students or their careers in other sectors? Are they aware of the lived experience within their institution? Have they adopted the practice of having groups of students describe their lived experience at the start of governing body meetings?
• Strategic deficit– do leaders plan for long-term impact, or do short-term pressures entirely consume them? How many governing bodies regularly review a medium-term policy budget properly costed over a five-year horizon?
• Conflict avoidance– when disagreements arise, are they managed constructively, or do leaders resort to avoidance and inertia? Are people discouraged from disagreeing to reduce the perception that they are disagreeable?
• Technological advancement– in an era of digital transformation, do governing bodies understand the risks and opportunities of AI, cybersecurity, big data sets and data analytics?

If governing bodies fail to cultivate the right skills beyond technical skills, such as legal and finance, they will remain incapable of meaningful leadership. 

The challenge ahead: does governance need to break its cycle?

To enable effective decision-making and strategic oversight, governing bodies must question three major risks: structural rigidity, cultural stagnation and critical skill gaps. Incremental improvements may not be enough. Governance cannot be static and must continually be redefined and challenged. 

So, the real question is: will governing bodies continue to operate in systems that may have served the institution well in the past, or do they need to embrace the uncomfortable but necessary transformation that might be required for effective future leadership?  

John Rushworth is a Senior Governance Associate with Advance HE and the former Executive Secretary at the Committee of University Chairs. Find out more about John.