Board Oversight of Institutional Performance

Council Insights: Council of Board Chairs

By Jill Derby March 7, 2023 Blog Post

Opinions expressed in AGB blogs are those of the authors and not necessarily those of the institutions that employ them or of AGB.

“Board Oversight of Institutional Performance” was the topic of the February 8 meeting of the AGB Council of Board Chairs. Few areas of focus could be more critical in terms of board governance practices and captures the sentiments with which AGB CEO Henry Stoever opened the zoom meeting.

The discussion questions framing the session were the following:

• What evidence should boards seek regarding their institution’s

– Educational quality?

– Financial sustainability?

– Governance integrity?

• What are the barriers to effective board oversight of these issues?

• If asked to demonstrate the quality of your board’s work, what evidence would you provide?

Council Ambassador David Maxwell, PhD, set up the topic by laying out the scope of board member responsibilities regarding oversight and expanding on the important distinction between the administrative role and that of trustees. Board members need to know what is going on in the institutions they govern while entrusting the management of their colleges and universities to the administration. How can boards know what is going on then, becomes the central question.

The board’s oversight responsibility includes the areas of educational quality, including the student experience on campus. Financial sustainability is also central to the board’s fiduciary responsibility as are its ethical standards of conducting its governance responsibilities. Given these requirements, the issue of how the board fulfills these requirements framed the session’s 60-minute discussion.

Council Ambassador Jill Derby, PhD, introduced the subject of accreditation as a key monitoring tool, but one often underutilized by boards in their ongoing review of institutional performance. Accreditors bring an independent view to their regularly timed assessment of educational quality, the student learning experience, financial sustainability, and other dimensions of institutional performance. Their on-site and multifocused evaluation of institutional performance and their stress on continuous improvement of the institutions they accredit offers the kind of evidence that supports the board’s fiduciary responsibility to monitor institutional performance.

The institutional accreditation cycle proceeds from an initial, comprehensive self-study done by the institution, from the department level on up. This intensive process is followed by an on-site, multiday, institutional visit by an appropriately selected team of peer evaluators representing the accrediting agency. A follow-up accreditation report is the final product of the process. This cycle can proceed well over the space of a year There are often areas of challenge and/or weakness cited in the report that require a follow-up review by the agency. A yearly progress report is commonly part of the accreditation cycle.

Along with institutional accreditation, individual programmatic accreditation is also part of an institution’s accreditation roster. Engineering schools, for example, can pursue accreditation by the Accreditation Board of Engineering and Technology (ABET). Medicine, pharmacy, business, and many divisions of an institution’s offerings may acquire accreditation from independent agencies that accredit their specialties. Board members have a responsibility to know of the accreditation status of the various programs within the institutions they govern

The value of the board’s attention to this process at every stage of the cycle is clear, given governance oversight responsibility. Various ways to manage such a focus were proposed. It was suggested that boards regularize their attention to accreditation reports through calendar scheduling to ensure their appropriate involvement in their institutions’ cycle of accreditation procedures and activities. Having a yearly agenda item devoted to the topic was offered as a way to keep the focus on the board’s calendar. Assigning the responsibility of maintaining the board’s focus on accreditation to the appropriate committee—possibly the Academic Affairs Committee was also proposed.

The rotation of trustees on and off of governing boards underscores the need for ongoing board orientation and education regarding the process of institutional accreditation and the role it plays in board oversight. One council member reported on the value of the “deep dive into institutional functioning” that the accreditation process offered her board. Others commented on the opportunity accreditation offered their boards to participate in the process in ways that furthered their knowledge of institution’s offerings and deepened their engagement in its progress.

Each one of the nation’s institutional accreditors monitors the governing board’s performance itself according to a set of standards laid out in their accreditor handbook. These standards focus on the effectiveness of the board’s governance practices, their compliance with conflict-of-interest requirements, and their independence from inappropriate intrusion or undue influence from external constituencies. Board members as fiduciaries must always put the institution’s interest ahead of any constituent pressures and not allow divided loyalties to influence their judgment in board decisions. It is advised that trustees should be aware of the governance standards to which the agency that accredits their college or university holds them accountable. Any failure on the part of the board to adhere to the standards by which their performance is measured could penalize the institution they serve. One example was referenced in which a breach of governance standards kept the institution in question from receiving a clean accreditation review.

One council member shared the important role their board’s “Shared Value Statement” played in directing board attention and behavior in constructive ways. Many boards have adopted similar documents guiding board behavior, some with titles such as “Board Standards and Expectations” or “Board Guidelines.” These documents can provide useful principles for reference in board orientation and, occasionally, in instances of a board member straying from expected behavior. The reminder was offered to the group that only boards can police and manage their members’ behavior. It is not a role presidents or others can exercise.

The culture of the governing board and the critical way it shapes the culture of the institution it governs was brought out. Trustee orientation and the way new board members are inducted onto the board impacts their performance going forward and helps to perpetuate a culture of constructive participation, appropriate comportment, and collegiality. The need for ongoing board development and education was stressed.

Limited meeting time typically consisting of four or five meetings a year necessarily constricts board attention and activities. It was seen as one of the barriers to a board’s ability to fulfill its oversight responsibility. The role of the board chair in conjunction with the president in agenda setting was brought out as vital in channeling limited board time to productive outcomes. Advice was offered by one council member to get the board out of the “show-and-tell mode” of mostly hearing administrative reports and into designated times of discussion on the strategic issues facing the institution. A suggestion of half administrative reports and half trustee discussion time was put forward.

Limited board meeting time drew further discussion and suggestions were offered as to how best to fulfill oversight responsibilities given this constraint. The effective use of board committees was reemphasized as was scheduling committee meetings at times separate from board meetings as a means to preserve board time for focus on more strategic issues. Committee meetings can be held virtually for efficiency to avoid added travel. The development and use of dashboard performance indicators as tools is seen as valuable both in managing limited time constraints and providing the board with the evidence it needs to ensure that it is serving the institution it governs with the necessary means of oversight.

Finally, the role of the board chair, working in partnership with the president, is seen as key in board time management and agenda setting. Careful attention to scheduling plays a central role in ensuring that institutional performance is appropriately monitored, and all other fiduciary responsibilities are fulfilled.

Jill Derby, PhD, is a senior consultant for AGB Consulting and an ambassador for AGB’s Council of Board Chairs.