BY ROBERT A. SCOTT
Every state requires hairstylists to receive certifications before they serve the public. There are certification programs for hospital trustees and education programs for corporate directors. Yet few states require training for college and university trustees, individuals who are fiduciaries for the more than $1.2 trillion in operating funds and endowments held by institutions nationwide.
This is particularly troubling because less than 10 percent of these trustees have any professional experience in higher education. One cannot imagine a company board in which such a small percentage of members understood its core mission, strategies, financing, competition, and competitive advantage.
The nominating process for boards varies by institution and often does not adequately consider a candidate’s industry knowledge. On corporate boards, experience and knowledge of purpose, key technologies, competition, and finance issues are essential. This is not true in higher education.
Examples of Inadequate Board Oversight Abound
Michigan State, Penn State, the University of Maryland, and Virginia, among others, offer disastrous examples of boards behaving badly and offering inadequate oversight. This is especially the case when the board’s leadership focuses on preserving and enhancing the institutional brand, ranking, or athletic prowess, instead of fostering academic excellence and student success.
When considering these cases, one must ask:
- Did the audit committee reviewed a risk analysis matrix to consider the areas of vulnerability on campus, including activities managed through contracts with outsiders?
- Did the board recognize that there were iconic figures on campus that were above questioning, as was the case at Penn State?
- Did any board member ask if anyone has used the Whistleblower Hotline, and what kinds of questions or complaints were posed?
- Did anyone consider that actions intended to protect the reputation of the institution often backfire and make matters worse?
Trustee Intrusion in Management Matters Are Frequent
Private colleges and universities are not immune from trustee misbehavior and misalignment of expertise with institutional requirements. Trustee intrusions into admission decisions, investment allocations, business contracts, and personnel matters occur more frequently than we would wish.
The most effective board members bring questions to their meetings, or ask beforehand, because they have read and thought about the materials sent in advance. They read journals such as Trusteeship, online media such as Inside Higher Education and The Chronicle of Higher Education, and books like ours. But most do not.
We recognize the large scale and complex missions of public and private research universities. We also acknowledge that there are equally difficult issues at colleges and universities of every type and size, as shown in recent examples at several small private colleges.
The point is that the trustees of every institution are responsible, as the noted sociologist and commentator on higher education, David Riesman said, for protecting the institution of the future from the actions of the present.
Trustees Must Study, Engage, and Question Before Voting
Board members must ask questions and expect answers. It is the role of the board chair to ensure that robust discussions of proposals, alternatives, and implications take place before calling for a vote.
The board’s role is to monitor and assure the alignment of mission, goals, priorities, resource acquisition and allocation, strategies, and results. Trustees must do so in partnership with the president and in a culture of shared governance involving the faculty. This requires trust, and trust requires full, transparent, and open communication.
Previous professional experience in higher education is often undervalued. Some of the most effective boards include senior academics or experienced leaders from other, non-competing institutions. They often are better positioned to ask strategic questions and offer responses, effectively modeling good behavior.
Board members should be aware of the key indicators of institutional vulnerability and vitality. These include commonly accepted financial ratios, accounts receivable, and cash flows from operations. They also include admissions funnel data year-to-date and over time, comparative progress in graduation rates over time against both peer and aspirational institutions, employer assessments of alumni, licensure exam results of seniors and recent graduates, the tuition discount and net revenue trends, diversity measures, and accreditation reviewer comments. Goals and resource allocation must align properly.
States Should Provide Certification for Board Members
Boards must constantly work to educate themselves. There are professional programs and literature available. Regional accrediting associations provide criteria on good governance already. But we think a further step is desirable.
States should provide a form of certification for board members of public and private universities. After all, state charters are the fundamental governing documents of institutions.
And, while it may be easier for a state to mandate such training for public college and university trustees than for private boards, the model can be adopted universally. For example, each state has an association of independent colleges for joint lobbying and purchasing. They could sponsor training and certification programs for the trustees of member institutions.
In addition, private foundations that support higher education and express concerns about the lack of success in achieving key university goals, such a graduation rates, could sponsor seminars on trusteeship best practices. Audit firms and bond rating agencies could do the same for their clients and provide a certificate of completion for board and senior staff members.
As a society, we invest billions of dollars in students and institutions each year. Shouldn’t we expect that college and university trustees are better prepared to fulfill their joint duty to educate citizens and prepare the global workforce?
This article first appeared on the Academic Innovators’ publication on Medium.
This is a perennial problem in the corporate governance model: there is little if any separation among management and governance, with rather predictable performance challenges. And universities are corporations. Take the University of Chicago as an example. Its ratings and prestige notwithstanding, its administration and Trusteeship are modeled on the public corporation, where trustees are organized around financial influence and assets; cross-governance reach; political influence and ideological solidarity, among other characteristics. They are also there (that is, cultivated) to promote and protect the “CEO” or the university president As for the Trustees, the writer is correct. They typically have little if any pedagogical background; few if any with doctorate training; many without professional graduate degrees. Is this a problem? Yes and no. It promotes cultural insulation, stasis or special interest criteria, and rarely results in structural modification. But that as well stems from the academy and its collective organization effects. Most trustees otherwise view their position as effective philanthropy; hence their utility to administration. But this can bury problems deeply over long periods, like the modern corporation (and as well from the presence of private and government liability risk management including for example against Title VI causes of action, or any number of private claims that can pierce the university corporation). And like a modern enterprise that exists in protected and fragile equilibria (say, a coal plant), it is external actions from the ‘marketplace,’ that often force change. That may, or may not, be productive for many universities. The marginal, yes. The consolidated perhaps not (in some cases, especially). That ultimately invokes synthetic or cross-complaints against the state, however, which is nearly indistinguishable from the modern university. Hegelianism, as Popper asserted, is indeed the renaissance of tribalism, and the modern university rests firmly among his ideology. There is also otherwise, a somewhat different set of problems and opportunities in public, versus per se private, institutions. Thank you and regards.
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I wish national AAUP would write a handbook for members of Boards of Trustees and Boards of Governors! We aren’t we in AAUP setting the guidelines and expectations?