Shake-up looms for governance

State education ministers have agreed to develop a new set of principles to strengthen the governance of Australian universities.

The accord was reached at a meeting of state ministers at Kelmscott Senior High School last month, hosted by Education Minister Tony Buti with federal minister Jason Clare also in attendance.

The meeting was prompted by one of five key priorities outlined in the Australian University Accord: a comprehensive review of the nation’s higher education landscape to formulate a long-term strategy to the country’s evolving skill requirements.

The new governance principles will be applied to public and private universities, which each to operate under their own act of parliament and specific to the state of their registration.

A key feature of public universities’ governance architecture is the presence of a governing body, known variably as the council, senate or board of trustees.

This body plays a pivotal role in maintaining ethical standards, overseeing strategic planning, and ensuring accountability across a university’s educational, financial, commercial and legal domains.

At the forefront of this governance apparatus is the chancellor, the chair of the governing body.

Working closely with the vice-chancellor and president, the chancellor is responsible for championing robust governance and integrity standards.

Public university governing bodies have operated alongside a Voluntary Code of Best Practice for the Governance of Australian Public Universities, produced by the University Chancellors’ Council in 2010 and amended in 2018.

This latest agreement features enhanced reporting requirements linked to these standards, as well as an expanded scope of the principles.

Once finalised, this new set of principles will serve as a comprehensive framework for fortifying governance within Australian universities.

The principles will address 10 priority areas crucial for effective institutional management and accountability, with which universities must comply.

The first principle emphasises the necessity to achieve a balanced representation within the governing body, with an emphasis on incorporating external expertise – particularly in university leadership – to provide holistic perspectives and strategic guidance.

Principle two underscores the need to refine structures and processes to ensure thorough consultation and engagement with the university community – particularly on matters of high risk and priority – to foster transparency and accountability.

Diversity is a central theme across several principles, including the third principle, which highlights the importance of reflecting the diversity of the Australian community and the specific characteristics of the university community they serve in making appointments.

Principle four emphasises achieving gender balance on the governing body in line with jurisdictional and Commonwealth targets, while the fifth principle calls for the inclusion of First Nations membership.

The sixth principle advocates for the inclusion of one or more student members on the governing body, with a requirement for separate, transparent processes to capture student input on university strategy, policies and performance.

Principle seven highlights the importance of including one or more staff members on the governing body. This principle also stresses requirements for distinct, transparent processes to capture staff and union input on university strategy, policies and performance.

The eighth principle stresses the requirement for all new appointments to go through a rigorous and transparent selection process utilising a formal and regularly updated skills, capabilities and diversity selection matrix that aligns with jurisdictional requirements.

Principle nine underscores the necessity for all governing body members to have (or undertake) training on the specific responsibilities and expectations of their role.

The final principle emphasises the need to demonstrate and maintain a rigorous and transparent process for developing remuneration policies and settings for senior university staff, with consideration given to comparable scale and complexity public sector entities and ensuring remuneration policies and packages are publicly reported.

This last principle aims to address executive compensation, which has long been a point of contention and drawn criticism from factions within both major political parties as well as the academic union.

Collectively, the principles represent a comprehensive approach to governance reform in Australian universities that aims to promote diversity, transparency and accountability while ensuring effective leadership and representation across all decision-making levels.

It’s expected the principles will be endorsed by state education ministers by the end of this year to herald in a new era of governance excellence in Australia’s higher-education sector.

• Professor Gary Martin is chief executive officer of the Australian Institute of Management WA