Positive shifts, challenges and opportunities in UK Higher Education governance

Positive shifts in Higher Education governance

1. Strategic vision: Universities UK’s “Blueprint for Change”
   • In September 2024, Universities UK launched a long-term strategy to guide the sector through 2035.
   • The blueprint focuses on five key shifts:
     • widening opportunity
     • fostering collaboration
     • driving local growth
     • securing research strength, and
     • enhancing global engagement.
   • This vision aligns institutional goals with national priorities and global trends.
2. Governance culture: From compliance to agility
   • Advance HE’s 2025 Big Conversation revealed a sector-wide move toward more value-driven governance.
   • Boards are adopting more inclusive practices, empowering student voices, and experimenting with informal engagement formats.
   • This shift enhances board agility and responsiveness in a rapidly changing environment.
3. Financial resilience and innovation
   • Universities are diversifying income through micro-credentials, partnerships, and lifelong learning.
   • Digital transformation is improving operational efficiency and student experience.
   • Enhanced risk management and scenario planning are helping institutions navigate financial uncertainty.
4. Policy and regulatory reform
   • The UK government is working to simplify regulation while maintaining accountability.
   • There’s growing support for modular, flexible learning models that meet evolving student needs.
   • These reforms reduce administrative burden and encourage innovation in teaching and delivery.

Gap analysis: areas for improvement in Higher Education governance

1. Board composition and capability
   • There is no one-size-fits-all model for board structure, but many are too large or lack the necessary skills to respond to today’s pressures.
   • Skills audits are often conducted but rarely acted upon. Inductions are ineffective, and effectiveness reviews are seen as disruptive rather than developmental.
   • Boards often excel at strategy development but fall short in monitoring implementation and outcomes.
2. Financial and strategic oversight
   • Financial sustainability reports are frequently overly optimistic, with boards signing off on unrealistic budgets.
   • Some boards are strong on financial matters but weak on compliance and internal controls.
   • There is growing resistance to transparency, with reluctance to disclose governance weaknesses.
3. Culture and behaviour
   • Culture is increasingly recognised as a critical component of governance, yet it is rarely embedded in audit planning or board discussions.
   • Internal auditors must go beyond data – engaging with staff and understanding the lived experience within institutions.
   • Addressing behavioural issues at the Audit and Risk Committees (ARCs) is crucial, balancing challenge whilst encouraging staff to raise difficult issues.
   • A dominant Executive Team (ET) can stifle challenge and debate, leading to rubber-stamping rather than robust scrutiny.
4. Academic quality and student wellbeing
   • Many governors lack confidence or expertise in academic quality, often avoiding the topic altogether.
   • Student wellbeing is inconsistently understood at board level, despite its growing importance.
   • Technology and digital transformation are poorly understood by many boards, creating strategic blind spots.

What’s next for governance in Higher Education?

The UK higher education sector is at a pivotal moment. While governance challenges persist – ranging from board capability and financial oversight to cultural and academic quality gaps – there is also clear evidence of progress.

Institutions are embracing strategic vision, cultural transformation, and financial innovation.

To build on this momentum, universities must continue to invest in board development, embed cultural assessments, and align governance with evolving regulatory and societal expectations.

Internal auditors and governing bodies alike must champion transparency, agility, and continuous improvement to ensure the sector remains resilient and globally competitive.

For advice and support specific to your organisation, please contact Lara Petruk or Richard Evans.