The dual impact of governance: how governance contributes to financially and socially sustainable institutions

In our second Big Conversation workshop, Aaron Porter chaired keynote speakers Mary Curnock Cook and Kamran Razmdoost who offered their insights into the role of governance in shaping both financially and socially sustainable institutions. Their perspectives revealed a shared recognition that good governance is not simply a matter of compliance or structure - it is a dynamic, values-driven process that must evolve with the challenges and complexities facing the higher education sector today. 

The case for social sustainability: governance as a catalyst 

Kamran Razmdoost outlined a compelling vision for governance in socially sustainable institutions. He began by highlighting the diversity inherent in the higher education landscape, which encompasses a broad range of institutional types, stakeholder needs and educational missions. This diversity necessitates a flexible and inclusive approach to governance - one that goes beyond a one-size-fits-all model. 

His remarks also referred to the tension between public/social responsibility and the increasing pressures of marketisation and competition in the higher education sector. Institutions are being asked to serve societal goals while also competing aggressively for resources, students and recognition. Governance, therefore, must play a mediating role - ensuring that social responsibility remains at the core even as institutions adapt to market forces. 

Kamran proposed three practical and culturally focused elements of governance to embed social sustainability through governance: 

1. Relational governance: rather than relying solely on rigid formal structures, relational governance encourages informal information sharing and deeper interpersonal connections. This approach allows for quicker, more effective decision-making, especially in times of rapid change.
2. Connectedness across the institution: sustainability should not reside only at the top of the governance pyramid. It must be embedded from the boardroom to the classroom, ensuring that all levels of the institution are aligned in purpose and action.
3. Embracing risk and entrepreneurialism: in a volatile, hybrid environment, institutions must be willing to take risks and learn from failure. Governance frameworks should enable a test and learn mindset rather than stifle it with excessive caution or bureaucracy. 

Financial sustainability: governance with teeth 

Mary Curnock Cook tackled the equally pressing challenge of financial sustainability, which bluntly, without being met will ultimately lead to failure. As she pointed out, many higher education institutions are failing this test - despite the clear, long-standing importance of financial viability. Governance, she argued, must play a more assertive and strategic role. 

Mary identified three critical focus areas for boards: 

1. Skills and challenge: governing bodies must ensure they possess the right skills mix to effectively scrutinise financial strategies and challenge executive leadership. The ability to probe assumptions and test projections is crucial in today’s uncertain landscape.
2. Moving beyond performative governance: often, too much agenda time is taken for the regular schedule of business and the academic and regulatory reporting cycle. Mary called for a more focused approach - where attention is concentrated on the issues that truly matter to long-term sustainability. Long papers which are activity based should not be acceptable to a Board.
3. Rigorous risk management: risk registers alone are not enough. Boards must understand how risks interact with strategy and be prepared to stress-test assumptions in realistic and meaningful ways. Each paper should have a link to risk and the path for getting any red risks to amber or green should be interrogated.  

She also raised the often-overlooked issue of meeting records. Minutes and actions must faithfully reflect discussions and decisions, serving not just as a compliance document but as a tool for institutional memory and accountability. It’s vitally important that governance office colleagues really understand what information is relevant to governance. 

Culture over structure 

Both speakers returned to a central theme: the importance of governance culture. It is tempting to focus on structures and formal procedures - but these can only take an institution so far. What really matters is cultivating a governance culture that is proactive, inclusive and capable of navigating complexity. 

For instance, information flow should not be reactive - where governors only see what executives choose to share. Instead, governance should be built on a culture of openness and inquiry, where informal channels (as seen in relational governance) enable deeper understanding and engagement. 

Rethinking financial oversight: the recruitment challenge 

One of the clearest examples of governance falling short is in student recruitment. Many institutions have made overly ambitious projections that have not materialised, exposing them to financial strain. Boards must become more sophisticated in interrogating these assumptions, even when they lack deep sector expertise. 

The role of the Chair is pivotal here. A strong Chair, working closely with the Senior Leadership Team, can ensure agendas are focused on the most important issues. Similarly, the University Secretary or Registrar must act as an honest broker - independent enough to highlight what governors need to know, and close enough to understand the institution’s operating reality. 

Stress-testing projections - using upside, downside and base case scenario - should become standard practice. External experts could also be asked to bring independent knowledge, information and insights to help inform decision making. This kind of financial foresight allows institutions to build realistic contingency plans and avoid being blindsided. 

Toward agile governance 

Finally, the workshop explored the structural barriers to agile governance. Overlong board papers, packed agendas and a crowded room of attendees can stifle meaningful discussion. There’s a need to rethink how boards operate - prioritising strategic depth over breadth and ensuring meetings focus on a small number of high-value topics. 

Smaller committees or task groups can handle more specific or operational matters, freeing the full board to deliberate on big-picture strategy. This approach also empowers governors to engage more deeply and ask sharper questions - particularly if they are supported by good pre-reading materials and clarity of expectations. 

A governance model fit for the future 

What emerged clearly from the discussion was a call for transformation - not just in the mechanisms of governance, but in its mindset. Institutions must evolve governance practices that are bold, responsive and aligned with both financial realities and social purpose. 

Financial and social sustainability are not competing priorities - they are deeply interconnected. Robust governance ensures that an institution not only survives but thrives in service to its community, its mission and its long-term goals. This means having the right people, asking the right questions and creating the right culture. 

Ultimately, the future of higher education depends on institutions that can be both principled and practical - and governance is where that balance begins. 

Aaron Porter is Associate Director Governance, Advance HE.  

Mary Curnock Cook is Chair, Dyson Institute of Engineering and Technology, a member of IHE.  

Kamran Razmdoost is Dean, ESCP Business School London, a member of IHE.