Recent publications from Advance HE, GGi, CUC, and AHUA suggest a shift in governance from compliance-focused oversight to strategic, integrated leadership. Boards are expected to be more agile, future-oriented, and deeply engaged with both academic and financial dimensions of institutional life.
This in the context of the recent Gillies Report into the University of Dundee’s financial collapse which exposed systemic failures in financial monitoring, management, and governance. The report highlighted a culture of overconfidence, poor financial judgement, and a lack of transparency, where challenge was discouraged and financial risks were downplayed.
In response, the Scottish Funding Council’s analysis of Governance Effectiveness Reviews (GERs)—published as Expectations of Good Governance —identified recurring sector-wide issues. These included delays in conducting GERs, superficial treatment of financial oversight, and a lack of assurance-focused scrutiny. The SFC now expects institutions to undertake timely and robust GERs that provide both assurance and developmental insights, with particular emphasis on triangulating evidence around financial sustainability.
Together, these findings underscore the urgent need for boards to strengthen their governance practices, prioritise financial competence, and foster cultures of openness and accountability.
In addition, The Committee of University Chairs (CUC) is currently undertaking a significant review and refresh of its Higher Education Code of Governance, with several expected changes and evolving expectations. This review is driven by financial pressures, intense scrutiny and a desire to ensure governance is future-facing, flexible and resilient. Key themes include Board responsibilities, academic assurance, financial sustainability, board culture and composition, governance integration, strategic foresight and regulatory pressure.
So, what should boards prepare for?
- More rigorous expectations around academic and financial assurance.
- A shift toward strategic, integrated governance.
- Greater transparency and accountability, possibly through more prescriptive standards.
- A need to review board composition and culture to ensure effectiveness and diversity.
- Proactive engagement with the Code refresh process to shape its final form.
Risk appetite and strategic assurance: two missing pieces
From our experience working in higher education, and other sectors, two areas often overlooked in university governance are the articulation of risk appetite and the adoption of a strategic approach to assurance.
Risk appetite is not just a compliance statement; it is a strategic instrument. Boards that clearly define and regularly review their risk appetite enable better decision-making under uncertainty. For universities, this means moving beyond generic risk registers to ask:
- What level of financial risk are we prepared to accept to invest in new academic programmes or international partnerships?
- How much reputational risk can we tolerate in research collaborations or freedom of speech debates?
- Where is our appetite for innovation balanced against regulatory compliance?
A well-calibrated risk appetite framework helps boards align decisions with institutional strategy, ensuring that risk-taking is intentional, not accidental.
In higher education assurance is often not strategically shaped by the board but rather driven by committees and the flow of reporting upward. It ends up fragmented – spread across committees, internal audit, and management reports – without a strategic coherence or prioritisation. A Board Assurance Framework (BAF) – much more common in other sectors like healthcare – addresses this gap by mapping strategic objectives against principal risks and sources of assurance. This approach enables boards to see:
- Where assurance is strong and where it is weak or duplicated
- How assurance links to strategic priorities, not just operational compliance
- Whether the board is receiving the right information at the right time
A robust BAF turns assurance into a strategic conversation rather than a technical exercise. It supports boards in focusing on what matters most: the interplay between risk, performance, and sustainability.
Integrated academic governance and assurance
Lots of universities are grappling with how to get their academic governance and assurance right between the council/ board and senate/ academic board. Academic governance is often described as the ‘quiet partner’ in university oversight, essential yet under-examined. Higher education boards spend far more time and focus on other areas like finance, estates and people matters and other than the annual academic assurance report and items in the vice chancellor’s regular report don’t engage much in academic assurance and oversight. And even with these reports true scrutiny can be minimal. This separation is no longer tenable. In an era of volatile student demand, regulatory intervention, and reputational risk, academic decisions have direct financial consequences, and vice versa. The bigger issue however is that academic assurance is so often standalone, an item in and of itself – partly because of the way universities are structured with the bicameral model – and not integrated with other areas.
Integrated governance means boards must develop fluency in academic risk. This is not about second-guessing academic judgement, but about asking the right questions:
- How do we know our academic portfolio is sustainable and aligned with strategy?
- What evidence assures us that quality and standards are robust under financial pressure?
- Where are the early warning indicators i.e. student outcomes, regulatory compliance, research integrity, that could signal systemic risk?
Boards should expect to see triangulated data: financial forecasts linked to student recruitment trends, quality metrics, and regulatory dashboards. Assurance cannot rely on narrative alone; it must be evidence-rich and forward-looking.
Crucially, this requires cultural change. Constructive challenge must be normalised, not feared. Information flows should be transparent and timely. And board composition must reflect the complexity of the task, bringing together financial acumen, academic literacy, and strategic foresight.
The refreshed CUC Code will likely codify these expectations. But compliance is not enough. The best boards will go further, embedding integrated governance as a strategic capability, not a tick-box exercise.
Financial governance and oversight
Finance dominates the agenda and attention of many boards, not just in higher education, and rightly so. Financial sustainability is the existential risk for universities. But focusing on finance alone creates blind spots. The real challenge is balancing attention across three interdependent domains: finance, quality, and performance.
- Finance: Boards must move beyond retrospective reporting to proactive stewardship. This means interrogating assumptions behind student recruitment forecasts, research income projections, and capital investment plans. It requires scenario modelling, stress testing, and clarity on financial risk appetite.
- Quality: Academic quality underpins reputation, regulatory compliance, and student outcomes. Boards need assurance that quality and standards remain robust under financial pressure, and that academic decisions align with institutional strategy.
- Performance: Financial and academic health are meaningless without delivery. Boards must monitor organisational performance against strategic objectives – student experience, research impact, civic engagement – while ensuring that performance metrics are not distorted by short-term financial imperatives.
These three areas are deeply connected. Financial decisions affect quality; quality drives performance; performance influences financial resilience. The interplay between finance, quality and performance creates systemic risk. Boards must understand how external shocks – policy changes, demographic shifts, geopolitical uncertainty – could impact both academic integrity and financial health. This calls for integrated risk oversight, not siloed reporting.
Boards that treat them as separate silos are risking oversight gaps. Many examples of governance failure are a reminder that collapse often stems from cultural complacency and fragmented oversight, not a single bad decision.
The solution is integrated governance, a triangulated approach that links financial oversight, academic assurance, and performance monitoring into one coherent framework. This is not about more paperwork; it is about sharper insight and better foresight. Boards should expect dashboards that connect these domains, supported by a clear articulation of risk appetite and a strategic assurance framework.
How we can help you?
This overview chimes with what we are hearing from our members and our first-hand experience working with and reviewing higher education providers.
The challenges facing higher education governance are too complex for piecemeal solutions. Boards need assurance that their governance frameworks are not only compliant but genuinely effective, integrating financial oversight, academic quality, and organisational performance into a coherent strategy. That’s why GGI and SUMS Consulting have partnered to deliver joint governance reviews and support to the sector. In addition, SUMS have developed a framework for mitigating market exit risk and ensuring sustainability. HE provider framework: mitigate market exit risks & ensure sustainability – SUMS
Together, we bring deep expertise in governance design, assurance frameworks, and sector benchmarking, combined with practical insight into the operational realities of universities. Our approach goes beyond diagnostics: we provide actionable recommendations, tailored development plans, and tools such as Board Assurance Frameworks and risk appetite models to strengthen resilience and foresight.
In short, we help boards move from reactive compliance to proactive stewardship, building governance that is agile, integrated, and future-ready. If your institution wants to test its governance against emerging expectations and sector best practice, we can help you do it with confidence.
Our joint services include:
- Governance effectiveness and efficiency reviews at corporate, academic and executive levels
- Executive facilitation, leadership development and bespoke training
- Risk management and scenario planning
- Interim management, ongoing mentoring and critical friend support to embed change effectively
- Board workshops and governor induction.
Ensure your governance agile, integrated is ready for the future. Get in touch with our experts today at consulting@sums.ac.uk.
