by Robert A. Scott
Most think of university governance as the province of boards of trustees. At public institutions, these boards are appointed through a political process, usually involving the state’s governor and legislature. In a few cases, such as Michigan, they are elected directly by the citizenry. Private or independent institution boards are usually self-perpetuating, electing their own members. In neither case is governance acumen required, even though “trustee” means holding a charitable institution in trust.
What is less well known is that there are other board types in higher education that either act as an adjunct to trustee boards or fulfill most or all of the trustee governance functions. These other types of boards have different names.
The term Board of Governors is used for system boards that govern several campuses with local Boards of Trustees. In these cases, as in North Carolina, the Board of Governors delegates selected powers to the Trustee boards of sixteen campuses and the medical center. The term is also used for public institution Foundation Boards, whose primary functions are fundraising and advocacy.
The term Board of Regents is also used for state system boards, as in Colorado, or for the primary state entity responsible for higher education and other charitable institutions and organizations, as in New York State.
The term Board of Visitors is used for federal higher education institutions such as the military academies. Most of these boards operate under the Federal Advisory Committee Act (FACA) and function with authorities delegated by a federal agency such as the Department of Defense. These boards are charged with providing independent advice to the appointing authority, including advice about accreditation, leadership, and funding.
Still another model is the Corporate Board appointed by a religious order that delegates personnel and budget authorities to a lay Board of Trustees but retains ultimate authority regarding mission and assets.
In the for-profit sector, there are corporate-like boards similar to the religious organization model and private-equity investment models. In the former, budget development is from the campus up to the board; in the latter, the budget is imposed from the top down. Both types can earn regional and professional school accreditation.
Whether institutional governing boards are self-selected, appointed, or elected through a political process, or appointed under FACA, boards must operate under a statement of expectations and the Duties of Care, Loyalty, and Obedience.
The statement of expectations serves as a compact between each member and the board itself as well as with the institution. The board sets the standards for institutional deliberations. It can support a culture of respect and transparency, or one of secrecy. Transparency is necessary for trust, and both are essential for good governance. No surprises.
College and university boards have legal duties similar to those of for-profit boards: the duties of care, loyalty, and obedience:
The duty of care — preparation, participation, protection — relates to the level of competence expected of board members in carrying out governance responsibilities. They do this by exercising the degree of diligence and skill one would expect of a prudent person fulfilling such an assignment. It is the duty to prepare carefully for board meetings and participate actively in board discussions in order to protect the institution through appropriate oversight. The board’s role is to identify and oversee the management of risks.
The duty of loyalty — avoiding conflicts of interest — requires board members to act in good faith and in the best interests of the institution, not out of self-interest or in the interest of a particular constituency, including alumni. This duty specifies that a trustee should not have mixed loyalties but has pledged allegiance to just one institution at a time.
The duty of obedience — obeying the charter and mission, holding the public’s trust — requires that board actions be true to the campus charter and intended to fulfill the state-approved mission of the institution in a manner that complies with the law. This duty is based on the premise that constituents and the public at large can trust that what they are told by the board is true.
The board’s responsibilities include considering, approving, and monitoring the alignment of mission and values, goals, strategies, alternative and flexible courses of action, allocation of resources, rewards, and results. For example, the board would discuss the alignment of mission and graduation rates, the mission statement, and faculty rewards.
Higher education governance gives priority to long-term concerns for the institution’s mission and stakeholder interests rather than to short-term priorities benefiting managers, shareholders, or owners, as is more often the case with business boards. Higher education boards have multiple “bottom lines,” unlike most businesses.
For these reasons, institutional governing boards deserve to have members with governance acumen and continuing professional development. Yet, under 15% of college and university board members have professional experience in higher education. Yes, they are mostly college and university graduates, and may have children and grandchildren in college, but they do not have the kind of enterprise experience that a bank or corporation would require. We cannot imagine Chase or Google declaring that 85% of their directors lacked experience in the industry, so why should we in higher education accept it?
No matter the name, the college or university board must act as a governing board with the public trust paramount.
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