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Survey finds lack of transparency in agent relationships

Secret Agents
October 8, 2013

Only 13 percent of prospective international students who used education agents knew whether they worked on commission, according to a new survey from World Education Services.

The finding comes less than a month after the National Association for College Admission Counseling lifted its prohibition on the use of commissioned agents in international student recruiting with the caveat that colleges that utilize the practice must work to ensure accountability, integrity and transparency.  

Many international education experts say that transparency about commissions is crucial, as the payment method can influence which colleges and universities are recommended and which are not. When a student who's overseas is told that two or three colleges are "the best" for her, and she doesn't know that there is a financial reward in store for the agent if she ends up at one of those, there is a significant ethical issue raised.

Indeed, WES's survey research suggests that most students are in the dark. The research is based on a sample of 2,992 applicants to U.S. colleges who used WES’s credential evaluation services. Rahul Choudaha, WES’s director of research and strategic development, acknowledged that there are some limitations in the sample: for example, Saudi Arabians are overrepresented among WES clients and South Koreans underrepresented compared to their proportions in the overall applicant pool. However, he argued that the sample is broadly representative of international applicants in regards to their financial means and academic preparedness. There were 776 responses from China and 583 from India, the two largest source countries for international students at U.S. universities, in addition to 140 from Saudi Arabia and 1,493 "other." 

In addition to breaking down the survey data by degree level and country of origin, WES subdivided students into four categories based on their financial resources and self-reported academic preparedness: explorers (who have high financial resources and low academic preparedness), highfliers (high financial resources/high preparedness), strivers (low financial resources/high preparedness) and strugglers (low financial resources/low preparedness).

Overall, 38 percent of respondents -- and nearly half of all Chinese students (47 percent) -- said they had used an agent. Students from China were the most likely to know whether their agent earns a per-capita commission from colleges (21 percent versus the overall figure of 13 percent).

Survey Question: Has your educational consultant shared with you whether he or she receives a commission from colleges/universities for each student recruited?

 

China

India

Saudi Arabia

Other

Overall

Yes

21%

6%

10%

12%

13%

No

34%

60%

31%

44%

44%

Don’t Know/Can’t Say

45%

34%

60%

44%

43%

 

Source: World Education Services. Percentages may not add up to 100 due to rounding.

Notably, students from China paid the most: half of those surveyed reported paying an agent more than $2,000, whereas 61 percent of Indian students paid less than $500. These figures might seem relatively modest, but keep in mind differences in income levels across countries. In July, The New York Times reported that the average family income in China in 2012 was about $2,100.

Survey Question: Please estimate how much you paid or plan to pay for the educational consultant’s services in U.S. dollars.

 

China

India

Saudi Arabia

Other

Less than $500

19%

61%

40%

29%

$501-$2,000

16%

20%

20%

29%

$2,001-$5,000

32%

2%

20%

15%

$5,001-$10,000

17%

1%

0%

5%

More than $10,000

1%

0%

0%

2%

Don’t Know/Can’t Say

15%

15%

20%

20%

Source: World Education Services. Percentages may not add up to 100 due to rounding.

Students from China trusted agents the least. Only 7 percent of Chinese students ranked educational consultants as the most trustworthy source of information. Over all, 12 percent of survey respondents identified educational consultants as the most trustworthy source of information, while 33 percent ranked an admissions officer from a North American college as such. This latter figure was even higher for Chinese students, at 43 percent.

The top two services that students paid for were application assistance (78 percent) and university short-listing (76 percent).

"Explorers" and "strugglers" -- those two groups with the lowest levels of academic preparation -- were only slightly more likely to use agents than the high-preparation groups (40 percent of explorers and strugglers, versus 39 percent of highfliers and 35 percent of strivers.) Strugglers and explorers were more likely to use agents to help them with editing their essays, whereas strivers were most likely to use them to short-list universities.

Survey Question: Which specific services were included in the educational consultant’s fee?

 

Highflier

Explorer

Striver

Struggler

Overall

University short-listing

72%

68%

86%

75%

76%

Essay/Résumé/Personal Statement Editing

50%

67%

52%

67%

58%

Application Assistance

73%

78%

80%

86%

78%

Interview Preparation

44%

55%

52%

49%

50%

Visa Consulting

57%

58%

61%

57%

58%

Transition to North America

25%

26%

20%

25%

23%

Source: World Education Services

“We are highlighting two issues here,” said WES's Choudaha. “One is of course it is established that there is a segment of students which is using agents; there is no denying of that fact. The question is, is your institution ready to recruit the type of student, or the segment of students, using agents.”

“The second thing we are answering is if [institutions] move forward with that, and say, yes, I want to use an agent, they should be aware of what risks they are assuming and what risk mitigation processes they need to protect students.”

With regard to transparency, “There is clearly a gap between what the student knows and what the agent says.” Choudaha suggested that institutions can start to address this by 1) listing the agents they work with and the financial terms of those relationships on their websites and 2) requiring agents to disclose these relationships to students. Colleges can monitor whether this is in fact happening by surveying students about their experiences working with agents.

The issue of incentive-based compensation in international student recruitment has been deeply controversial in the U.S. due to concerns that agents will put their own financial interests ahead of the interests of their students. Furthermore, there are concerns about having two different standards in the recruitment process: federal law bans incentive-based recruitment of American students precisely because of historic abuses associated with the practice, primarily in the for-profit sector. However, with the recent NACAC change the national debate seems to be shifting away from the question of whether institutions should work with agents in international recruiting to how they can ethically do so.

NACAC’s International Advisory Committee will be hammering out expectations for colleges regarding transparency in the year ahead. David Hawkins, NACAC’s director of public policy and research, said that WES’s finding about students’ lack of knowledge regarding commissions did not come as a surprise, as members of the association’s Commission on International Student Recruitment have identified the lack of transparency as a pervasive problem. The commission, which studied the issue of incentive-based compensation in international student recruitment for nearly two years, released its findings this summer

“This was one of the areas where the commission actually had unanimous sentiment and understanding,” Hawkins said. “Everyone, whether you were pro-agent or not-so-pro-agent, everyone on the commission agreed that there was a substantial amount of confusion, that, in fact, there was actually not much knowledge on any side of the transaction about where people’s interests were.”

The American International Recruitment Council, an association that provides a certification process for agents, has a set of standards that agencies must meet and set of “best practices” guidelines for institutions that use agents. Those guidelines don’t include suggestions on disclosing agency relationships to students at present, but John Deupree, AIRC’s executive director, said that the issue of transparency is top of mind and will be the subject of at least one session at the association’s December conference.

“The institutional guidelines for best practice are only the beginning and we very much believe that this will evolve, and I think the transparency question is really a good one to have at a forefront,” he said. One complicating factor, he said, is the fact that in many cases an agent is contracted by only one unit of a university -- an intensive English language program, say, and not the undergraduate admission office – raising the question of when you consider an agency to be representing an institution. Deupree also raised the question, “At what point does transparency tip into areas which an institution would consider proprietary?”

“By and large, we’re supportive of this,” he said, of the effort to increase transparency, “but we recognize that there are complexities which need to be discussed and a consensus found.”

 

 

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