Strategic Board Leadership Creates New University Governance Paradigm with Henry Stoever | Changing Higher Ed Podcast 066

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University Governance

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Strategic board leadership is an emerging paradigm of university governance that can help higher education institutions navigate multiple challenges. This podcast features Dr. Drumm McNaughton and Henry Stoever, president of AGB.

Changing Paradigm of University Governance

Typically, higher education boards are made up of individuals who are appointed as trustees because they have made significant philanthropic contributions, either to the institution or, in the case of public universities, to a political party candidate who then appoints the individual once elected. This approach is shifting as boards and institutional leadership teams begin to develop strategic partnerships.

In the changing approach to governance in crises and board leadership, both individual trustees, as well as the entire board, need to learn how to work in strategic partnerships during crisis with higher education presidents and the institution’s leadership team.  This approach shifts the university governance focus so that the board and its members become a built-in consulting team for the higher education president and cabinet. Additionally, the board no longer serves as a rubber stamp for the institution’s proposed strategies and initiatives; instead, trustees need to proactively engage as thought partners.

In the current environment, both student success and long-term institutional vitality are part of the crisis recovery for higher education institutions due to the pandemic and the resulting online and hybrid learning environments. These issues have increased the importance of strategic board leadership in order to create well-informed, more holistic strategies for both student success and long-term institutional vitality.

Strategic thought partnerships between presidents and boards are becoming increasingly important as the pressure mounts on higher education presidents due to the pandemic. These individuals are on call 24/7 and can face unrest at any time. At the same time, the roles and expectations of board members have never been more challenging. By working together, presidents and boards can leverage their work for institutional and student good.

Recruiting Board Members

Changing board member recruitment approaches are having an impact on how board governance operates. Previously, the primary driver for recruiting board members has been philanthropic (or political donation) capacity and relationships.

In this new paradigm, philanthropy remains important, but selection of board members also must be based on other attributes, including their knowledge of key areas such as academic affairs, finance, marketing, strategy and risk, operations, legal, regulatory and international experience. Boards should be proactively identifying these necessary skills through using a skill set matrix. This matrix builds and informs the composition of the board through analyzing individual board members’ skills and those that are needed on the board, and balancing them against individual trustees’ terms. This approach ensures that appropriate trustees are seated who can oversee the creation of the strategy for the institution’s future, instead of focusing on the institutional past.

Evolution of University Governance

Over the past year, boards have been forced to change how they work. In addition to meeting more frequently to address the myriad of challenges due to the pandemic and social unrest, they are beginning grapple with being more accountable to stakeholders.

Boards also have had to lean in from an oversight perspective. This requires working in partnership with the higher education leadership, but not doing the work of the management team. This is especially true in the case of merging universities or creating alliances.

Boards must listen to all key stakeholders, both on and off-campus, while also listening to and working with the institution’s leadership team to ask insightful and probing questions. Trustees are being asked to consider alternatives and also to analyze both the intended and unintended implications of potential strategic directions.

The mnemonic NIFO (nose in – fingers out), or in other words, not micromanaging is critical in today’s university governance environment. The board’s role is to listen and ask the difficult questions of administration. Making suggestions in a limited way is acceptable (and encouraged), but there is a fine line between oversight and suggestions vs. micromanagement. Unfortunately, the difference between oversight and suggestions versus micromanagement is not cut and dry – it varies among boards and administrations.

One of the ways that boards can be in touch with stakeholders is through establishing board committees and strong governance that have both board members and key stakeholders on them. This enables board members to gain deeper insight into what is going on in the college or university, as well as giving institutional stakeholders a direct opportunity to interact directly with the board.

Institutional members must be clear that this is NOT an invitation or process to short-circuit or make an “end run” around the university president. Issues that are brought to the committee must be “blessed” by the president. One way to get this right is to have the president as an ex-officio member of all committees of the board, and this does not preclude the committee from going into executive session if there is an issue that must be discussed without the president in attendance.

Implementing shared governance also needs to be embraced more by higher education boards. This approach, which involves sitting down and interacting with faculty, administration, staff, and alumni, has strong implications in higher education. A lack of honoring stakeholders in shared governance and/or ignoring key stakeholders’ inputs can result in faculty or other groups sending a vote of no confidence about the administration or board, which sends a negative signal about the institution to the broader institutional community.

Justice, diversity, equity, and inclusion also have been highlighted in recent months. While much work has been done at the administrative level, most boards have not leveraged these values into strategic policies and decisions. From an optics perspective, student enrollment has become much more diverse; however, faculty and board composition have not evolved to align with their customers, and board must take a proactive approach to DEI (diversity, equity, inclusion), especially in relation to representation on the board.

Strategic relationships require listening and hearing differences of opinion. Unrest is becoming more common, so boards and administration need to be prepared to establish justice and equity. The pandemic has extended the levels of inequity since the historically marginalized communities have been disproportionately weighted by the impacts of the pandemic. Boards also need to engage in building strategic crisis communications playbooks to be prepared when this societal unrest comes to campus.

Continuing Fiduciary Duties

Trustees still have a responsibility to ensure that students receive a quality education and the institution remains sustainable. Trustees’ fiduciary duties of care, loyalty, and obedience are the same for higher education boards as they are for corporate boards. Boards also need to be involved in the strategic planning for the institution, but should not micromanage. Instead, they should focus on ensuring that planning is done holistically and there are sufficient risk mitigation processes in place.

More and more, people are looking for work-force education, but at the same time, institutions need to be creating lifelong learners and collaborative participants in society. However, boards and institutions often don’t know who the institution’s customers are.

While the main focus needs to remain on students, there also is a difference between customer and consumer. In higher education, the person paying the bill—often the parent—is the customer. Students are the consumers since they absorb the content.

Three Recommendations for Higher Education Boards and Leaders

Stoever suggested several takeaways for higher education leaders:

  • The transformation of university governance to strategic board leadership is critically important because higher education won’t be the same once the pandemic is over. Both the general population and the number of traditional students are declining so the demand for higher education may decline. Therefore, boards need to be thinking strategically about transformation.
  • Justice, diversity, equity, and inclusion need to be part of every conversation, board agenda, and strategy.
  • Board membership should not be viewed as an honorific position. Instead, board members need to be actively engaged and contributing their talents and time to further the higher education institution’s mission during this pandemic.

Bullet Points

  • Higher education boards frequently are made up of individuals who are appointed as trustees because they have made significant philanthropic contributions. However, this approach is shifting.
  • Recruiting board members should be based on individual attributes, including specific knowledge of key areas, such as finance, marketing, strategy, legal, regulatory and international experience. Boards are proactively identifying these necessary skills through using a skill set matrix.
  • Both individual board members as well as the entire board need to learn how to work in strategic partnerships with higher education presidents and the institution’s leadership team. Christian institutions are moving from primarily preparing pastors and missionaries to preparing professionals.
  • Strategic board leadership can create well-informed, more holistic strategies for both student success and long-term institutional vitality.
  • Boards have to lean in from an oversight perspective, which requires working in partnership with the higher education leadership, but not doing the work of the management team.
  • Shared governance and listening to differences are important. This approach involves the board sitting down and interacting with faculty, administration, staff, and alumni, which has significant implications in higher education.
  • Justice, diversity, equity, and inclusion are important for the board to consider. This needs to involve creating board policies as well as the composition of the board.
  • Trustees continue to have responsibility for their fiduciary duties to ensure that students receive a quality education and the institution remains sustainable. These responsibilities include care, loyalty, and obedience.

Links to Articles, Apps, or websites mentioned during the interview

Guests Social Media Links

Resources

Dr. Drumm McNaughton is a higher education consultant who has been providing board governance and shared governance consulting services to colleges and universities for over 20 years.

Check out Dr. McNaughton’s downloadable presentation on Building Strong Institutional Governance Systems.

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