Comparison between the HE Code of Governance and the University's arrangements

The following table sets out the differences between the University's governance arrangements and the Higher Education Code of Governance , published by the Committee of University Chairs (CUC) in December 2014 (HE Code).  HEFCE requires the institutions it regulates to report in their annual corporate governance statements that they have had regard to this voluntary code and to provide an explanation of any inconsistencies.  

Oxford’s governance reflects the general principles of the HE Code and is consistent with most, although not all, of the specific guidelines.  The HE Code is arranged under seven Primary Elements of Higher Education Governance (Elements). Each Element is supported with statements which a governing body ‘must’, ‘should’ or ‘could’ adopt in order to help it meet the Element. The table below compares Oxford’s arrangements against each of the seven Elements and the ‘must’ statements. Where Oxford’s arrangements differ, the alternative arrangements that are in place are set out. In some instances, where they are important to Oxford’s governance structure, such differences are also addressed for ‘should’ and ‘could’ statements.

 Issue

HE Code guidelines

Oxford

Primacy of governing body

Element 1: The governing body is unambiguously and collectively accountable for institutional activities, taking all final decisions on matters of fundamental concern within its remit.

X: Council’s decision is final unless Congregation exercises its power to intervene to oppose or amend that decision.

Regulation and accountability

Three instances are given in the HE Code: the governing body must seek assurance that the institution meets the legal and regulatory requirements imposed on it as a corporate body; the accountability requirements falling on the governing body in respect of public funding must be followed; and its members as charity trustees must comply with legislation governing charities and case law in the exercise of their duties.

√: Oxford’s Council receives assurance on the legal, regulatory and accountability requirements through reports of its committees, including the Audit and Scrutiny Committee. How new Council members and Council itself receive guidance on their duties and responsibilities is set out below.

Representation of staff and students on governing body

Staff and student members of the governing body share the same legal responsibilities and obligations as other members and must not be routinely excluded from discussions.

 

 

 

√X: Oxford’s Council includes members of academic staff; they have the same responsibilities and obligations as the other members. Three student representatives are also entitled to attend and observe meetings for unreserved business, but are not members of Council.

Openness and transparency

The governing body could consider… including in its annual report a corporate governance statement which sets out the institution’s governance arrangements (including the extent to which it has adopted this Code), policies on public disclosure and making the report widely available.

Publishing agendas and minutes of its meetings.

: Oxford’s publicly available annual Operating and Financial Report includes a Statement of Corporate Governance which references this analysis of the extent to which the University has adopted the HE Code. Council agendas and unreserved minutes are posted on the University intranet.  A decisions note and non-confidential papers in unreserved business are posted on the University intranet within one week of the meeting.  Any issue requiring the consent of Congregation is published in the University Gazette.

Publication of a Statement of Primary Responsibilities

The governing body should…clearly define and communicate the scope of its own responsibilities in the context of legislation, governing instruments and guidance including the HE code through a Statement of Primary Responsibilities.

: See Oxford’s Statement of Primary Responsibilities

Institutional reputation through governance

Element 2: The governing body protects institutional reputation by being assured that clear regulations, policies and procedures that adhere to legislative and regulatory requirements are in place, ethical in nature, and followed.

: Oxford’s Council approves changes in legislation and (together with its committees) approves changes to and oversees policies and procedures.

Ethical behaviour and conflicts of interest

In protecting the reputation of the institution the governing body will want to ensure the highest standards of ethical behaviour among its members, who must act ethically at all times in line with the accepted standards of behaviour in public life, and in the interests of the institution.

The HE Code then addresses the following points:

  • members of governing bodies must act, and be perceived to act, impartially, and not be influenced by social or business relationships;
  • a member who has a pecuniary, family or other personal interest in any matter under discussion must disclose the interest;
  • the governing body must ensure that its decision-making processes are free of any undue pressures from external interest groups;
  • members whose views are not consistent with the decisions of the governing body should abide by the principle of collective decision making and avoid putting specific interests before those of the institution;
  • individually members must not make any agreement for which they do not have authority.

: New Council members are provided with papers setting out their duties as charity trustees and providing guidance on public benefit and conflicts of interest. Council is also briefed on these matters in its first meeting of the year.

Oxford maintains a register of interests.  The register for Council members and senior officers is published in the Publication Scheme. In addition, members of Council and members of all committees of Council are asked to declare any interest that could give rise to conflict in any item on the agenda at the beginning of the item in question.  Such declarations are  recorded in the minutes.  If the chair of the meeting deems it appropriate, the member concerned shall absent himself or herself from all or part of Council’s discussion of the matter.

Governance of the student union

Legislation requires that the governing body must take practical steps to ensure that the students’ union or association operates in a fair, democratic, accountable and financially sustainable manner. This requirement is in addition to corporate and charity legislation that many student organisations are independently subject to.

√: Council reviews the constitution of the Oxford University Student Union (OUSU) every five years as required by legislation, and through one of its members is the final court of appeal regarding complaints against OUSU. Otherwise Council’s responsibilities in this respect are delegated to Education Committee’s Joint Subcommittee with Student Members, which meets termly and reports to Education Committee.

Practical role of governing body

Element 3: The governing body ensures institutional sustainability by working with the Executive to set the institutional mission and strategy. In addition, it needs to be assured that appropriate steps are being taken to deliver them and that there are effective systems of control and risk management.

: Oxford’s Council is responsible for institutional sustainability; it sets the institutional mission and strategy and (together with its committees) takes the steps needed to ensure their delivery, receiving reports on control and risk management.

Role of head of institution

The governing body is responsible for the mission, character and reputation of the institution at a strategic level, and members will need to be adequately informed in order to carry out this key responsibility. They can expect the head of the institution to help them by providing strategic advice and guidance on the mission and strategic development of the institution.

[In the example Statement of Primary Responsibilities of the governing body, one of its duties is:] To delegate authority to the head of the institution, as chief executive, for the academic, corporate, financial, estate and human resource management of the institution.

: Oxford’s Vice-Chancellor carries out all roles required of her by the HE Code. 

Strategic Plan and sustainability

The strategic plan plays a crucial role in ensuring the successful performance of the institution, and the governing body will want to demonstrate its commitment to and support for the plan by formally approving or endorsing it in accordance with its constitution. Aligned to this, it must ensure there is an appropriate financial strategy and be responsible, without delegation, for the approval of the annual budget.

It must rigorously assess all aspects of the institution’s sustainability… using an appropriate range of mechanisms which include relevant key performance indicators (KPIs) not just for the financial sustainability of the institution but also for its impact on the environment.

In ensuring sustainability, the governing body must be in a position to explain the processes and the types of evidence used and provide any assurances required by funders. Where such assessments indicate serious issues which could affect future sustainability, the governing body must undertake appropriate remedial action.

 

: Oxford’s Council is responsible for the development and (subject to Congregation) approval of the strategic plan, and for its delivery, monitoring its implementation through KPIs. Council approves the annual budget and the annual financial statements.   The Planning and Resource Allocation Committee, the Audit and Scrutiny Committee and the Finance Committee (all of which report directly to Council) also have important roles in relation to institutional sustainability, the delivery of the strategic plan, and assurance to the funding body.

Audit Committee

The Audit Committee must be composed of a majority of independent members (who may also be drawn from outside the governing body) and produce an annual report for the governing body, including: its opinion on the adequacy and effectiveness of the institution’s risk management, control and governance arrangements; processes for promoting value for money (VFM) through economy, efficiency and effectiveness; and (in institutions receiving funding body support) the management and quality assurance of data.

: Oxford has an Audit and Scrutiny Committee with an external majority and recent and relevant financial experience and an external member of Council as chair.  It provides Council with the required annual report.

Remuneration Committee

Governing bodies must establish a Remuneration Committee to consider and determine, as a minimum, the emoluments of the Vice-Chancellor and other senior staff as prescribed in constitutional documents or by the governing body.

The Remuneration Committee composition must include the [external] Chair of the governing body, be composed of a majority of independent members (who, as with audit, may also be drawn from outside the governing body) and have appropriate experience available to it. The Vice-Chancellor or other senior staff may be members of, or attend, the Remuneration Committee but must not be present for discussions that directly affect them.

Other requirements set out in the HE Code are that the Remuneration Committee must:

  • consider comparative information on the emoluments of employees within its remit and record decisions;
  • report on its decisions and operations at least annually to governing body; and
  • consider the public interest and the safeguarding of public funds alongside the interests of the institution when considering its business.

√/X: Oxford has a Committee to Review the Salaries of Senior University Officers. This is a body of seven persons, chaired by an external member who may or may not be a member of Council, and with two other external members. The two members appointed by Council and the co-opted member must not be subject to arrangements regarding their salaries that are within the committee’s remit.

Separate body (e.g. Senate or Academic Board) responsible for University academic work

Element 4: The governing body receives assurance that academic governance is effective by working with the Senate/Academic Board or equivalent as specified in its governing instruments in order to maintain quality.

Oxford does not have a Senate or Academic Board.  The Council takes academic policy decisions, advised in particular by Education Committee and Research Committee.

Assurance on academic governance

The HE Code explains that the governing body must satisfy itself that academic governance is operating effectively given the importance of the high-quality student experience and research portfolio, that academic risks are being effectively managed, and that it must understand and respect the principle of academic freedom.

:  Oxford’s Council exercises this responsibility through delegation to, and reports from, three of its main committees: Education, Research and Personnel.

 

 

 

External activities

Element 5: The governing body works with the Executive to be assured that effective control and due diligence takes place in relation to institutionally significant external activities.

Examples given in the HE Code are the governance of subsidiary companies, and that fund-raising, donations, sponsored research and partnerships do not inappropriately influence institutional independence, mission or academic integrity.

:  Oxford’s Council (together with its committee) exercises this control and due diligence.

Equality and diversity

Element 6: The governing body must promote equality and diversity throughout the institution, including in relation to its own operation.

The governing body must ensure that there are arrangements in place to

• eliminate unlawful discrimination, harassment and victimisation;

• advance equality of opportunity between people who do and do not share a protected characteristic; and

• foster good relations between people who share and those who do not share a protected characteristic.

…  The governing body must … satisfy itself that agreed action plans to implement the equality and diversity strategy are progressed throughout the institution.

The governing body must also routinely reflect on its own composition and consider taking steps to ensure that it reflects societal norms and values.

√/X: Oxford’s Council (together with its committees) promotes equality and diversity. Reports to Council must state how the Public Sector Equality Duty has been addressed. Council also receives an annual report on Equality and Diversity which updates Council on the agreed actions throughout the University.

The extent to which Council can promote equality and diversity in respect of its own membership and that of a number of its committees and boards is limited by the proportion of its members that are elected. Council has therefore set non-binding targets in respect the gender balance of its own membership and that of its main committees, and takes account of gender balance in making appointments to committees. The annual report on Equality and Diversity includes updates on how these targets are being met.

Governance structures

Element 7: The governing body must ensure that governance structures and processes are fit for purpose by referencing them against recognised standards of good practice.

√: The University’s governance review reported in 2011 and its outcome was referenced against the CUC Code. The structures are now referenced in this report against the HE Code.

External majority

The governing body must have a majority of external members, who are independent of the institution.

X: Oxford’s Council is constituted to have four external members out of total of 26 members.

Right to remove governing body members

The governing body must have the power to remove any of its members from office, and must do so if a member breaches the terms of his/her appointment.

: Oxford’s Council has the right to remove any of its own members.

Nominations Committee

The governing body must establish a Nominations Committee (or similar) to advise it on the appointment of new members and the terms of existing members as well as the perceived skills balance required on the governing body. Normally final decisions on appointment are taken by the governing body.

√/X: Oxford does have a Nominations Committee which advises it on the appointment of external members. Final decisions on those appointment are taken by Council subject to approval by Congregation.

Deputy chairs

The governing body will need to ensure suitable arrangements exist for the continuation of business in the absence of the Chair. In some cases arrangements for a Deputy Chair are codified within institutions’ governing instruments.

: Provision for two deputy chairs is made in Oxford’s legislation.

Appointment and removal of the Secretary/Clerk to Council.

All members of the governing body must have access to the services of the Clerk. Arrangements for the appointment or removal of the Secretary/Clerk may be defined by governing instruments; where they are not, it must be a decision for the governing body as a whole.

√/X The Registrar is secretary to Council and is appointed by Council.

Regularity of review of governing body’s own effectiveness

Governing bodies must conduct a regular, full and robust review of their effectiveness and that of their committees… Many governing bodies find an external perspective in this process useful, whether provided by specialist consultants or peer support from other governing bodies.

Reviews must be conducted at least every four years with, as a minimum, an annual summary of progress towards achieving any outstanding actions arising from the last effectiveness reviews.

 

 

 

 

 

: Council is required to carry out a self-review of its operations and effectiveness at least every three years and uses external consultants for this.

In addition, each main committee of Council is required to carry out a self-review of its operations and effectiveness at least every three years and report its findings to Council with recommendations for change where appropriate; and each committee of Council is required to review its composition and operation  shortly after its first year in existence, and shortly after its first year with a revised remit (where the responsibilities have been substantially changed), in both cases reporting its findings to Council with recommendations for change where appropriate.

Chair of governing body

The governing body should … ensure that the governing body has sufficient skills, knowledge and independence, including though the appointment of an independent Chair, to enable it to discharge its responsibilities.

X: The chair of Oxford’s Council is the Vice-Chancellor.

Size of governing body

The governing body should… be of sufficient size that its responsibilities can be undertaken effectively and speedily, without being so large that it becomes neither unwieldy nor too small. It could consider establishing a size within the range of 12-25 members.

X: Oxford’s Council has between 25-28 members.