EAIR CONFERENCE VILNIUS 2009 TRACK 2: FIGHTING FOR HARMONY- WHERE DOES THE POWER OF GOVERNANCE RESIDE? Creating the modern university – changing governance for a changing world DAMIAN BARRY DEPARTMENT OF ACCOUNTING AND FINANCE MONASH UNIVERSITY

OUTLINE Background and context The University: Purpose Power and Governance Drivers of change The Governance debate Leadership Creating the “modern” University

Department of Accounting and Finance Slide 3 UNIVERSITY THE TRADITIONAL UNIVERSITY COMMUNITY/GOVT/INDUSTRY STUDENT ACADEMIC

Department of Accounting and Finance Slide 4 THE MODERN UNIVERSITY? INDUSTRY PROFESSIONS GOVERNMENTCOMMUNITY ADMIN & MGT TEACHING RESEARCH STUDENTS

Department of Accounting and Finance Slide 5 Three Questions 1.Are existing University discipline-based structures appropriate for the effective governance of a modern University? 2.Should there be a fundamental review of the current leadership roles and their function? 3.What are the key elements of a modern University governance structure?

ENVIRONMENTAL SCAN Universities under fundamental challenge – government; students; staff; industry; community Current governance and structures are inflexible, not aligned to purpose, inhibit effectiveness. Much angst, debate, research and many reviews but any change has been at the margins. Purpose should drive structure

Department of Accounting and Finance Slide 7 UNIVERSITY: FUNCTIONS (PURPOSE) In Australia this is legislated to include: Research Education Engagement  Community, Industry, Government

Department of Accounting and Finance Slide 8 The purpose (objective) of the University is.. To inspire and enable individuals to develop their capabilities to the highest potential levels throughout life, so that they grow intellectually, are well equipped for work, can contribute effectively to society and achieve personal fulfilment; To increase knowledge and understanding for their own sake and to foster their application to the benefit of the economy and society; To serve the needs of an adaptable, sustainable, knowledge- based economy at local, regional and national levels; To play a major role in shaping a democratic, civilised, inclusive society. (Dearing 1997).

Department of Accounting and Finance Slide 9 Australia’s Higher Education Reform Principles – Universities purpose.. SustainabilityDiversity QualityEquity

POWER: WHERE DOES POWER RESIDE LEGISLATURE – CREATES UNIVERSITY; mandates academic based structures ACADEMIC – programs; structures; EXECUTIVE – resourcing; strategy; quality

GOVERNANCE.. ESTABLISHES WHO IS IN CHARGE. DRIVES VALUES AND CULTURE

GOVERNANCE RESEARCH – a review Academic perspective - culture and values Focus on bureaucracy and managerialism – not governance No organisation focus Locus of power and symbols of power remain unchallenged Fear of “trespass”

Department of Accounting and Finance Slide 13 Good governance Transparency, accountability and responsibility. Effective leadership and dynamics Effective structures and processes -delegations Effective membership Commitment to vision, culture and values Effective monitoring Effective information and communication

Department of Accounting and Finance Slide 14 CURRENT LIMITATIONS Structure supports “old” purpose and objectives Managing within structures rather than challenging the structures The University has evolved from Elite to Mass to Universal provider without serious review

Department of Accounting and Finance Slide 15 CHANGE IS HERE… driven by GLOBALISATION & INTERNATIONALISATION –COMMERCIALISATION –PRIVATISATION –“MARKETISATION” – COMMODIFICATION GOVERNMENT INFORMATION AND COMMUNICATION TECHNOLOGY

Department of Accounting and Finance Slide 16 WHO IS DRIVING CHANGE GOVERNMENT COMMUNITY INDUSTRY & PROFESSIONS EXECUTIVE MANAGEMENT

Department of Accounting and Finance Slide 17 The debate Academic concerns –Loss of autonomy –Reduction of academic freedom –Research –v- teaching –Managerialism, bureaucracy –Accountability –Workforce

Department of Accounting and Finance Slide 18 The debate Government view –Student centredness – quality teaching, equity and access –Improve community engagement –Accountability and quality control –Mission clarity – diversity and excellence –Leadership –Governance and risk management –Relevance of research output –Competition and collaboration –Public and private provision

Department of Accounting and Finance Slide 19 The debate… Administration view –Not involved –Organisation and Leadership focus –Issues…  Culture  Relevance, value and career  Relationships  Disenfranchised  Lack of empowerment and engagement

LEADERS AND LEADERSHIP COUNCIL CHANCELLOR VICE CHANCELLOR DEANS HEADS OF DEPARTMENTS/SCHOOLS

Department of Accounting and Finance Slide 21 To create the 21 st century University: University requires new mechanisms of governance to integrate academic and business processes to identify and pursue institutional interests and profile to exercise professional leadership (guidance) at all levels of the university to ensure respect for academic freedom to acknowledge members and stakeholders

Department of Accounting and Finance Slide 22 Challenges: Balancing institutional interests and academic freedom. Understanding the academic discovery process (participation, collegiality, hierarchy…) Professionalism and partnership: Managerial expertise plus academic endeavour can work together Communication - goals and intentions Democratisation and empowerment - recognise the shared roles and responsibilities Guidance rather than leadership Top-down plus bottom-up Personal rather than collective responsibility

Department of Accounting and Finance Slide 23 Challenges: Implementing new instruments of governance Change the Act Generate debate and opinion development through communication Empower managers at all levels Develop profile and strategy – a form of internal compact Implement contracts/agreements with stakeholders Allow performance-based evaluations Introduce achievement-oriented budget allocation (Gaehtgens, 2009)

How to get there… To deliver the 21 st century university governance MUST: “In structure and process, encourage and facilitate positive, proactive, and continuous institutional transformation together with relationship-building strategies focused on stakeholders as well as markets and sustained revenue generation (Gayle, Trewarie & White, 2003).

The twenty-first-century university will be: More an intellectual space than a physical space More than teaching and research Enabler of partnerships An organisation underpinned by: –instructional technologies –values –ideas –revenue flows –sociopolitical legitimacy – marketing and branding

Department of Accounting and Finance Slide 26 A different view “We should pay attention.. not to the specific form of elite institutions, but to the processes by which they embed relevance and responsiveness at an institutional level.” (Prof Ed Byrne (2009), Vice Chancellor, Monash University)

Thank You Questions?