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An Examination of Governance in Higher Education Institutions in England.

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Introduction

An Examination of Governance in Higher Education Institutions in England MSc in Corporate Governance Word count 2542 (not including references or appendices) Contents Page Abstract 3 Introduction 4 University regulation 5 The need for 'good' governance 6 Who governs the governors? 7 The role of the audit committee 10 Discussion 12 Conclusion 14 References 15 Appendix 1 Definitions of governance Appendix 2 Typical responsibilities of the 'Council' Appendix 3 Typical responsibilities of the 'Board of governors' Appendix 4 Guidance policies and procedures, HEFCE and associated organisations Appendix 5 Stakeholder diagram, Better Regulation Task Force 2002 Appendix 6 South Bank University decision-making structure Appendix 7 South Bank University Audit Committee terms of reference Appendix 8 HEFCE Model Terms of Reference from Audit Code of Practice Appendix 9 ICSA Terms of reference - Audit Committees Appendix 10 Definitions of governance Chambers & Committee for Standards on Public Life Abstract A recent report by the Council of University Chairmen stated that governing bodies of Higher Education Institutions (HEIs) "should review both their own effectiveness and the Institutions performance at regular intervals" (CUC, 2000a). A discussion of cases of poor governance in HEIs questions their ability to do this. This report firstly examines the accountability and statutory reporting requirements of governing bodies within HEIs in England. A comparison is then made of the governance structures of different types of universities to identify current practice. The report subsequently identifies internal and external university 'governors' and assesses the role of university regulators including the internal and external auditors. Finally there is a discussion of the findings and conclusions are reached. Introduction As with private sector entities, public sector bodies such as HEIs are overseen by a 'governing body' which is 'responsible for the conduct of its institution including ... use of public funds' (HEFCW, 1997). The governance structures within HEIs are determined by the legal origins of the organisation. ...read more.

Middle

Corporate Governance in Higher Education. Charity Commission. (2000). Operational Guidance. Exempt Charities. Higher Education Corporations OG 57 C2 - 01 March 2000 Committee on Standards in Public Life. (1996). Local Public Spending Bodies, Cm 3270-1. London: HMSO Committee of University Chairmen. (2000a). Guide for Members of Governing Bodies of Universities and Colleges in England, Wales and Northern Ireland, 01/20. Bristol: HEFCE Committee of University Chairmen. (2000b). Review of University Governance 1997-2000. December 2000 Committee of University Chairmen (2000c). Progress Report of the Working Party on the Effectiveness of University Governing Bodies. Davis C. (2002). The Future Masters of the Univers(ity). The Times Higher. November 15th 2002 pp 20-21 Dearlove J. (1998a). The Deadly Dull Issue of University "Administration"? Good Governance, Managerialism and Organising Academic Work. Higher Education Policy, 11 pp 59-79 Dearlove J. (1998b). Fundamental changes in institutional governance structures: the United Kingdom. Higher Education Policy, 11:111-120 Department for Further and Higher Education. (2002). Government Aims for Higher Education. Department for Education and Welsh Office (1992). Further and Higher Education Act 1992. HMSO: 1992 Higher Education Funding Council for Wales. (1997). Guide for Clerks to Governors of Higher Education Corporations. W97/75HE. HEFCE Higher Education Funding Council for Wales. (1997). Framework for Training Governors. W97/71HE. HEFCE Higher Education Funding Council for England. (2000). Strategic Planning in Higher Education: A guide for head of institutions, senior managers and members of governing bodies. 00/24. HEFCE: Bristol Higher Education Funding Council for England. (2002) Audit Code of Practice. 2002/26. Bristol: HEFCE Higher Education Funding Council for England. (1998). Effective Financial Management in Higher Education: A guide for governors, heads of institutions and senior managers. 98/29. HEFCE: Bristol Higher Education Statistical Agency (1999). HESA Finance Record1998-1999 English HEIs Higher Education Quality Council (1995). Academic Quality Audit of Thames Valley University (carried out in 1994) Institute of Chartered Secretaries and Administrators. (2002). ICSA Guidance Notes: Terms of References - Audit Committee. ...read more.

Conclusion

3. Objectivity, In carrying out public business, including making public appointments, awarding contracts or recommending individual for rewards and benefits, holders of public office should make choices on merit. 4. Accountability, Holders of public office are accountable for their decisions and actions to the public and must submit themselves to whatever scrutiny is appropriate to their office. 5. Openness, Holders of public office should be as open as possible about all the decisions and actions that they take. They should give reasons for their decisions and restrict information only when the wider public interest clearly demands. 6. Honesty, Holders of public office have a duty to declare any private interests relating to their public duties and to take steps to resolve any conflicts arising in a way that protects the public interest. 7. Leadership, Holders of public office should promote and support these principles by leadership and example. Chambers identifies 10 principles of good corporate governance: 1. Stakeholder control of the business 2. Maximum and reliable public reporting 3. Avoidance of excessive power at the top of the business 4. A balances board composition 5. A strong, involved board of directors 6. A strong, independent element on the board 7. Effective monitoring of management by the board 8. Competence and commitment 9. Risk assessment and control 10. A strong audit process Table 2. Governing structure of three HEIs Institution Established Governed by Senior Governor Decision-making body Monitoring Internal auditors External auditors Cambridge University Thirteenth century Statute drawn up in 1926. Institution known as 'common law corporation' Vice-Chancellor Council Consists of elected internal members only Regent House, Scrutiny Committee and Audit Committee Robson Rhodes Robson Rhodes King's College London University 1829 Statute Principal Board of Governors Audit Committee South Bank University 1992 Memorandum and articles of association approved by Privy Council Vice-Chancellor Board of Governors Institutional monitoring through review of corporate plan by BoG, directorate and associated committees Deloitte & Touche 1 1 Corporate Governance: Theories and Issues 04 May, 2007 1 31 Corporate Governance: Theories and Issues 04 May, 2007 ...read more.

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