The Potty-Trained Trustee

You would think that a survey of “American higher education governing boards” conducted by an organization called the Association of Governing Boards would survey the actual trustees that make up these boards.

Well, think again.

The AGB’s latest report, presented as a “Survey of Higher Education Governance,” does not in fact feature a single trustee. Of the 693 respondents, more than half are presidents or chief executives, with the remainder comprised of presidential/executive assistants, board professionals and senior administrators. As it turns out, the report says little about what’s on the mind of trustees and nothing about how they understand their role, but it does unwittingly reveal a philosophy, espoused by the AGB and shared by many at our colleges and universities, that underscores why there is a governance problem in higher education.

According to this view, higher ed administrations are the governance structure. Trustees for the most part should keep to their place and do as they are told by administrators. One might call it the potty-trained trustee, the board member who shows up at football games, cuts a few big checks, and doesn’t meddle in university affairs.

Consider, for example, the seemingly innocuous question put to presidents and other administrators in the survey: How difficult is it to recruit board members? The question presupposes that administrators should be selecting the board members who will then be charged with overseeing their work. But sound governance has trustees serving the interests of students, parents and alumni — not to mention taxpayers, in the case of state colleges and universities — not those of presidents. Sound governance is not about administrators finding “the new board members they want.”

If the Enron debacle taught us one thing, it is that boards must be independent of management. While the corporate sector is turning handsprings to ensure independent trustees and independent nominating committees, apparently we are to believe that our colleges and universities should operate according to a different set of rules. That should be no surprise, of course, since trustees selected by CEOs are more likely to agree with the administration and less likely to ask tough questions.

The report also rehashes the self-serving refrain that higher education institutions are governed by their “own business model.” As the author of the report explained to Inside Higher Ed: “Higher education finance is different from the kind of financial experience or information many board members come to their trustee service with.”

If that is indeed true, isn’t that part of the problem? As tuition and fees spiral out of control, having increased at more than four times the rate of inflation and almost twice that of medical care in the past 25 years, isn’t it time for trustees to apply the solid financial acumen many have developed in the real world — and not buy into the unsustainable economics of higher education?

Given the reigning governance model, we should perhaps not be surprised by the report’s findings that many boards are out to lunch when it comes to overseeing the academic and financial health of their institutions. We learn, for example, that “boards are typically tentative about taking steps” in the area of academic quality since “[h]igher education itself has not yet defined suitable ways to define, monitor, and talk about academic quality.” The fact that administrators have not yet done so is surely no reason why trustees should be hands off when it comes to working with them and faculty to rein in rampant grade inflation or implement a curriculum that will produce informed citizens, productive workers, and lifelong learners.

We are also told that boards currently spend over half their time “listening” to staff and committee reports and that they rely almost exclusively on information supplied by the institution when monitoring academic quality.

We are led to believe that boards properly engage in strategic planning, but then are told that all boards are “significantly more likely to receive reports about the planning process and to discuss emerging priorities than to have board representatives on the planning committee.”

We are told that nearly 70 percent of boards have adopted a statement of board member responsibilities that “can provide some assurance that board members understand and are committed to their responsibilities.” Yet when it comes to real responsibilities, we learn that only 64 percent of private institutions actually inform the full board of the president’s total compensation, and that 30 percent of boards do not document the process used to determine the president’s compensation.

Forces are building that make the go along-get along culture represented here ripe for substantive reforms. During the past decade, limited resources, rising costs, and mounting concerns about graduates’ lack of basic skills have prompted a demand for accountability. Taxpayers, students, and parents are being asked to foot increasingly higher bills, with no guarantee that their dollars are being well spent.

Meanwhile, scandals continue to mount. Bad press about corrupt student loan practices, presidential malfeasance, administrative cover-ups, rigged admissions, and excess compensation have drawn increasing attention to the need for trustees who do their job — neither meddling where they do not belong, as University of Illinois trustees appointed by two corrupt governors seem to have done, nor being asleep at the switch. Each new scandal underscores how urgently college and university boards need to get their houses in order.

The rising cost and declining quality that we see today in higher ed result, too often, from the belief that administrators are the real governance structure and that trustees exist to serve the institution first and the public interest second. It is time for trustees to wake up to this mindset and reassert their central governing role.