THE EFFECTIVENESS OF GOVERNING BODIES

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THE EFFECTIVENESS OF GOVERNING BODIES

• Workshop Session
• 25 August, 2006
• Michael Kelleher

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BACKGROUND 1

• LEGAL STRUCTURES
• 1968 EVENTS
• IMPACT ON CONTINENTAL EUROPEAN
  UNIVERSITIES
• STRONG REPRESENTATIVE MEMBERSHIP
• ACADEMIC STAFF, STUDENTS, OTHER STAFF

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BACKGROUND 2

• MASSIVE GROWTH
• INCREASED BUDGETS
• ACCOUNTABILITY
• COLLEGIALITY- SHARED GOVERNANCE
• MANAGERIAL MODELS

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BACKGROUND 3

• SIZE OF GOVERNING BODY
• INTERNAL/EXTERNAL MEMBERS
• GENDER BALANCE
• COMMERCIAL RISKS
• GOVERNMENT INTERVENTION
• LAY/EXTERTNAL MEMBERS

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BACKGROUND 4

• CORPORATE SCANDALS - ENRON etc
• SARBANES-OXLEY ACT, USA (2002)
• THE COMBINED CODE OF CORPORATE GOVERNANCE -
  UK most recent issue 2006
• COMPARE UNIVERSITIES with CORPORATE SECTOR
• MULTIPLICITY OF STAKEHOLDERS

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MODERN GOVERNING BODIES 1

• CHANGE
• GUIDELINES
• ASSOCIATION of GOVERNING BODIES - USA
• COMMITTEE OF UNIVERSITY CHAIRMAN - UK
• IRISH UNIVERSITIES ASSOCIATION

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MODERN GOVERNING BODIES 2

• AUSTRALIAN GOVERNMENT DEPT. OF SCIENCE AND
  TRAINING
• GUIDELINES MAINLY VOLUNTARY
• THREAT OF LEGAL IMPOSITION
• INFLUENCE OF CORPORATE PRACTICES
• EFFECTIVENESS OF GOVERNING BODIES

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ASSESSMENT OF EFFECTIVENESS

• MEMBERS
• AGENDA
• ACCOUNTABILITY
• ADMINISTRATION

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MEMBERS

• Are members adequately informed?
• Is role of governing body clearly understood by
  all, including members?
• Is there induction for new members?
• Does membership represent all skills/experience
  necessary
• Are skills and knowledge of members regularly
  updated

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MEMBERS 2

• Is balance between internal and external/lay
  members optimal?
• Is gender balance correct?
• Is independence of governing body assured?

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AGENDA 1

• Does the governing body clearly understand the
  distinction between the roles of the executive
  and of the governing body?
• Does the governing body operate strategically?
• Is the governing body presented with clear
  choices by the executive?

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AGENDA

• Does the governing body interrogate the proposals
  from the executive?
• Does the governing body contribute to the
  preparation of the strategic plan?
• Is the strategic plan implementation monitored by
  the governing body

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AGENDA 3

• Is the governing body adequately briefed on the
  views of academic staff on academic proposals?
• Is there a clear understanding of the sensitive
  balance between the responsibilities of the
  governing body and of the senior academic body
  (senate/academic council)?

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ACCOUNTABILITY

• Is the governing body clear as to its functions
  in overall financial governance?
• Is the governing body adequately informed of
  (non-academic) financial risks?
• Is the relationship between the governing body
  and its audit committee optimal?
• Does the governing body satisfy itself that there
  is legal compliance (health and safety, taxation,
  employment law, procurement, estate management,
  charitable status, etc.)

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ADMINISTRATION 1

• How effectively are new members selected (where
  legally feasible)?
• Does the governing body receive all required
  information in a timely manner?
• Does the governing body examine the structure of
  the executive as to its appropriateness?

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ADMINISTRATION 2

• Does the governing body review the role of its
  secretary and ensure the independence of that
  office?
• Does the governing body examine the functioning
  of its sub-committees and the contributions which
  individual members make to the university?

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CONCLUSION

• DOES THE GOVERNING BODY CARRY OUT A REGULAR
  REVIEW OF ITS OWN EFFECTIVENESS AND OF THAT OF
  ITS MEMBERS, ON THE BASIS OF THE FOREGOING
  ISSSUES, OR OTHERWISE
• DOES THE GOVERNING BODY MAINTAIN CONTACT WITH THE
  UNIVERSITYS STAKEHOLDERS students, staff,
  local and national/international business, local
  and national government, funding agencies for
  teaching and research, benefactors, teaching
  hospitals, church authorities, schools, other
  colleges and universities, etc.
• DOES THE GOVERNING BODY CARRY OUT ITS FUNCTIONS
  IN THE CONTEXT OF THE FACT THAT THERE IS NO
  BUSINESS LIKE UNIVERSITY BUSINESS. (Larsson,
  Allan Keynote Address 24 August, 2006)
• End.