Governance of Australian Universities
Governance
Governance refers to the systems and processes that direct, lead, control, or govern, an institution.
Governance allows for the appropriate direction and use of power and authority in organisations, promoting effective decision-making capacities, risk management, and the ability for the organisation to ultimately meet its mission.
Good governance ensures that best practice is adhered to in the systems - or frameworks - in place for governing of an institution. Areas of best practice include leadership of the institution, accountability, transparency, and integrity.
The Australian Institute of Company Directors (AICD) outline ten principles of good governance. These ten principles include mission, culture, independent judgement, skilled stewardship, risk tolerance and oversight, diligence, delegations to management and committees, appointment of executives, stakeholder engagement, and evaluation of the board’s performance.
University Governance
Universities are large, complex institutions, with imperatives for public good, academic excellence, and operational and financial sustainability. Alongside their responsibility to teach and educate students, universities also have a responsibility to contribute to research - both domestically and internationally. They have significant budgets and infrastructure, alongside large employee numbers and student bases, and make contributions to their local communities.
University campuses have a range of support services available for domestic and international students — including housing, health and wellbeing services, library access, and community and social spaces.
As significant contributors to Australian society and economy, and integral institutions in the future of skills and productivity for individuals, university governing bodies and frameworks for governance are integral. Specialised, professional skills are required on governing bodies to guide and manage the longevity and sustainability of these important institutions.
For universities, governance is the framework that allows the university to meet its mission of education and research, and its imperatives for public good, academic excellence, and ongoing financial and operational sustainability in its local context.
Governance is tailored to the institution — as in the private sector. For example, regional universities with a smaller staff and student base would have different governance needs to a metropolitan university with high-delivery research obligations and considerable international student intakes.
University Governance in Australia is influenced by many factors, including legislative changes and funding obligations.
Each university in Australia is established under similar, but not identical, pieces of legislation from their state, and each university is different in how the issues they face influence their planning and decision-making processes.
Governing Bodies
All universities have a governing body, called either the Council, Senate, or Board/Board of Trustees. These governing bodies are made up of between 10 and 21 individuals, determined by state legislation.
Governing bodies are made up of appointments by the State Government, or the Governor of the State, alongside External Members selected by the governing body - who are selected for their skills and experience. University governing bodies typically utilise a skills matrix to ensure the required and appropriate skills are in place.
Universities also have ex-officio members of the governing body who are senior staff members, and representative members of the governing body — both staff and student — who are often elected by their institution. The number of representative members included varies per state.
The governing body is responsible for oversight of the university mission, strategy, financial sustainability, commercial and legal obligations, risk frameworks, and the overall delivery of outcomes for the public good.
Governing bodies delegate functions to the management of the university. While the governing body of the university is the central authority for decision-making in all aspects of university life, the day-to-day management of these functions are often delegated to either university management, or the academic board.
University management (through the Vice-Chancellor) has operational management responsibilities delegated from the governing body, which includes financial management and sustainability of the organisation.
Academic boards and their Chairs (who are ex-officio members of the governing body) have responsibility for maintaining academic excellence and management of academic matters of the university.
This framework is referred to as tripartite governance, and its workings can vary according to state legislation
The Chancellor
The Chancellor is the formal head of a university, acting as the Chair of the governing body. Chancellors are responsible, along with the governing body, for university governance, and are expected to exemplify best practice in governance while working with the university community.
Chancellors have often held senior positions in business, government, public service, and/or the not-for-profit sector, and can leverage their networks from these roles in their workings and support for the university.
The role of the Chancellor and their relationship with the university Vice-Chancellor can be likened to the role of the Chair of a company board, and their relationship with their company CEO.
Chancellors play prominent representative roles for the university, presiding over ceremonial occasions such as graduations. Chancellors in this context are symbolic of the values and educational purpose and mission of the university. As such, they seek to exemplify the high standards of the university both in the university community, and its wider community.
Aside from governance leaders and representative roles, Chancellors are also advocates for the interests of their university, with extensive knowledge of their university and ongoing, visible commitment to the university’s mission.
Chancellors who exemplify ethical governance and integrity will actively encourage the collaborative contribution of all members of the governing body — promoting open discussion, transparent decision-making, and a culture of collaboration and collegiality.
Articulating the roles of governing body members falls within the remit of the Chancellor, ensuring that each member of the governing body is aware of their responsibilities and the expectations as an important part of the governing body.
Responsibility of Vice-Chancellor appointment, performance, and remuneration is also the responsibility of the Chancellor — with the governing body. The Chancellor supports the appointment of a new Vice-Chancellor to the university, on the retirement or resignation of the prior incumbent. This requires consideration of the remuneration of the incoming Vice-Chancellor, and the appropriateness of the remuneration in alignment with the responsibilities held and the institutions size and mission. The Chancellor and the governing body monitor ongoing Vice-Chancellor performance, and ensure that practices in management are aligned with governance of the university.
University Legislation
The legislative and regulatory environment for universities can play a significant role in university governance — impacting the workings of the governing body and the obligations of the university. Understanding this environment is helpful for understanding the environment and responsibility of university governing bodies.
Universities have different requirements built into their State or Territory Enabling Acts or Acts of Parliament - which both allow universities to operate and inform their purpose and mission. Universities have reporting requirements under the State or Territory Government in the context of their WHS/OHS obligations, financial accounting and audit obligations, and Industrial Relations reporting. Further, universities are subject to Commonwealth Legislation in their operation, student support and management, and funding.
State Legislation
Each University in Australia is established under its own Act of Parliament in the State or Territory in which it is registered. These Acts of Parliament are similar, but not identical, legislative pieces, also called enabling Acts. Included in the state enabling Acts are requirements on university governance, including the size and composition of university governing bodies.
Changes to legislation in this instance can impact the composition of governing bodies, which can further impact their operation.
The Acts under which universities are established/enabled can be found on the State and Territory Government Legislation websites:
Commonwealth Legislation
Universities are also governed by federal legislation, which speaks to not only the operations of the university, but also individual university support for students, academic requirements, and international student registration capacity. While this is a non-exhaustive list, federal legislation can broadly be noted as the legislative pieces that govern a university’s operations in the context of their core mission of education and research.
The TEQSA Act enables TEQSA as the regulator who provides registration for all Australian universities through a standards-based quality framework. Universities in Australia undergo a comprehensive review every 5-7 years prior to their registration being renewed.