Higher aspirations: an agenda for reforming European universities

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EUROPEAN UNIVERSITIES RECOMMENDATIONS difficult to engineer and good, because cultures do change. In this respect we would like to think that the time is ripe for a change and the only piece of advice we can give is: do not hesitate to celebrate those that give. Endowments The autonomy, responsibility and quality of decision-making of universities, research centres or graduate schools would be much helped if these institutions had endowments, not merely physical but also financial. Obviously we cannot pretend, or hope, that in the foreseeable future all European universities will possess endowments capable of sustaining them with their return 34 . But even if, on average, endowments were to generate revenue of the order of five percent of universities’ budgets, this would be very significant and it would have much added value, in the currency of quality of decision- making, beyond the monetary return. Endowing institutions with this capability would represent a one-shot commitment of approximately one percent of European GDP. This is certainly significant and not all countries will be in a position fiscally to undertake an injection of this type. But in the end it is a question of priority. The idea, incidentally, is not new. In 2007, the Australian government established a Higher Education Endowment Fund (HEEF) that does exactly what we suggest 35 . Incentives In matters of funding incentive effects are of paramount importance. Beyond the cost- covering aspects one should also consider the consequences that different types of funding induce on the effort and the commitment of universities to research. This means that public funding rules should be transparent and stable over time. In particular, they should not penalise success. In fact, the opposite should prevail: they should reward it. This is currently not always the case. University officers sometime live in fear that success in private fund-raising will lead to ‘compensatory’ decreases (or unexpectedly low increases) in public funding. This tendency should clearly be avoided. 34. For an interesting discussion of the role of endowments in US universities, see Hansmann, 1990. 35. See Australian Government, 2007. 49
EUROPEAN UNIVERSITIES RECOMMENDATIONS 7.2 Autonomy and governance Increased funding must go hand-in-hand with reform of autonomy and governance. Autonomy The degree of autonomy of universities from public authorities should be, on average, considerably higher than what it is at present. It is true that there are restrictions on student access and fees (especially at the first degree level) that may be appropriate and that certainly limit the scope of autonomy. It is legitimate for public authorities to impose a number of public policy objectives on universities in compensation for the funding they award them. This applies also to the structure of curricula (sometimes derived from international agreements) that need to be accepted. But beyond this we think that the ESHE will be better and more vibrant if it is open to the free play and interaction of self-set strategies on the part of universities. To be more concrete, we propose that every university in Europe should be autonomous, in the sense of having legal standing, owning assets, having the capacity to contract, to hire staff and set their pay, and freedom to set budgets and develop policies of every kind. Ideally, universities – or, for that matter, research centres – should be endowed with (i) a board which decides policy; (ii) an efficient and professional management structure (the best use of faculty resources is not in management); and (iii) internal participatory mechanisms. (Self-)governance Self-governance is a different issue than autonomy. A university can be viewed as self-governed if its board, or a good part of it, emerges from an internal election process involving the different components of the university community, in varying proportions. And, especially, if the main authority of the university – president, rector, vice-chancellor – also emerges from such a process. University autonomy is neither implied by, nor implies, self-government. A university can have very little autonomy if its head, endowed with little real authority and chiefly representative status, is internally elected. Conversely, a university can be very autonomous if it has a board that selects the main authority (not necessarily from within the university) through an external, political process. We put forward three observations: 50
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