NMITE – something new in HE governance

I am fortunate to have been sent a copy of the role description for the founding President and CEO of NMITE – the New Model Institute for Technology and Engineering. It offers a lot more detail about the proposed governance structures at this new university foundation in Hereford. It is not a co-operative, but neither does it conform to the traditional forms of governance associated with other universities in the UK. It is something new in patterns of higher education governance.

Staff contracts and rewards

There appears to be some considerable ambition to be different in the way staff are contracted to work at NMITE. Claiming to have learned from Olin College in the US (one of the partner/mentor organizations) and having tested the idea among prospective staff, the following is proposed:

Our institutional reward system will be based in concept on the John Lewis Partnership model (a retired senior John Lewis director is working with us) – a model that has so successfully been used at John Lewis and elsewhere to focus the culture and actions of employees on delivering consistently high quality service. NMITE will measure employee and operating success on the quality of  teaching and the employment success of graduates.  The performance system will be specifically designed to reward high quality teachers with further resources to support their teaching and broaden the impact of the educational experience they are providing students.  We believe this will result in the acquisition of inspirational tutors and other academic staff.

And

There will be no tenure, all employees will be retained under standard commercial contracts of employment

This sounds like a teaching-focussed contracting system, just as John Lewis’ contracting system aims to employ staff talented at customer service. However, just because it is a bit like John Lewis, there is not necessarily anything co-operative about it. Indeed, John Lewis is not a co-operative, but is owned by a beneficial trust for employees. Of course, John Lewis is a profit-making firm, but the NMITE is intended to be a not-for profit, so while the contracting may be similar, governance is not: but some reworking of the John Lewis model was inevitable to fit NMITE’s charitable purpose and charitable form.

Corporate form and internal decision-making

Rebecca Boden, Penelope Ciancanelli and Susan Wright (2012) have put forward the concept of a Trust University as a possible co-operative structure for universities. In the Boden et al model, the institution would be owned by an irrevocable beneficial Trust. NMITE’s proposal is something entirely novel, as far as I am aware. The proposal is for a top-level charitable trust with responsibility for fundraising and ethos. A second charitable trust, a subsidiary of the first, will be the responsible entity for policy, operations, quality and motivation. The President/CEO will serve on both, but it is not clear where responsibility for audit, ultimate accountability, etc, will lie. There will be an elected Employee Council with what appears to be an independent Chair (at least, it is a separate role to that of the President/CEO) with a seat on the (subsidiary) Trust Board, and a formal advisory role to the President/CEO. This appears to be more like classic German-style employee relations than a co-operative to me, but who knows what such a body could achieve in a university? There is a lot to like about this proposal that makes your average pre-92 Senate look rather wimpy by comparison, but at the same time, it is plain that the employee council is subordinate to the executive and Board, which is more like the set-up in a post-92 Higher Education Corporation or a private institution. The latitude available to the Employee Council would depend on whether the Chair of that body turns out to be the Provost (head of academics) role, or someone independent.

I can’t see any details of student representation, and if there is none, then that would be a retrograde step (if technically legitimate, as the Committee of University Chairs’ code makes clear in its paragraph 7.6) but perhaps this will be rectified in due course. There will also be an Advisory Council, similar to Court in a pre-92 English university, but smaller, to represent the interests of the wider community.

NMITE governance

Well-known co-operative consultancy Baxendale are listed among the consultants supporting the project, which accounts for the statements regarding the John Lewis group.

There are no other obvious manifestations of cooperativism, but there is plenty for cooperators to like in the curriculum, with a focus on developing the whole individual, and to inculcate a care for society and the environment in their professional practice. There is also clear potential for this new organization to experiment with cooperative governance in a higher education setting, if that is the choice of the future President/CEO. Co-operative-minded engineers might be advised to investigate this job further…

References

Boden, R., Ciancanelli, P., & Wright, S. (2012). Trust Universities? Governance for Post-Capitalist Futures. Journal of Co-operative Studies, 45(2), 16–24.
Committee of University Chairs. (2014, December). The Higher Education Code of Governance. Committee of University Chairs. Retrieved from http://www.universitychairs.ac.uk/wp-content/uploads/2015/02/Code-Final.pdf
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Newcastle College: hacking, co-operatives, and Students as Producers

Joss Winn has just posted an excellent blog of his conference keynote speech. In it he recognises the co-operative journey Newcastle College has been on through their adoption and development of ‘Student as Producer’. Joss challenges them to take the next step: into explicitly considering and adopting an organizational form that embodies the principles of Student as Producer: a co-operative legal form. Stirring stuff.

http://josswinn.org/2015/03/a-short-history-of-hacking-values-and-principles-for-co-operative-higher-education/

Ideas for enabling mutual growth – the Hunt review

Mutuo, the leading co-operative think tank, published the Hunt Review at the end of 2014. It is a wide-ranging document that seeks to advise the government (or perhaps a future government) on practical actions that could be taken to support the growth of mutuals.

The Education sector is tackled as a part of the public sector, where Hunt notes that:

“Mutuality offers a way of harnessing and expressing the public interest, whilst maintaining the independence of businesses. Government can act to bring these bodies closer to the people that they serve.”

(Hunt, 2014. p.33)

 

Drawing on the extraordinary success and rapid growth of the Co-operative Schools movement, Hunt recommends expansion:

“Taking Co-operative and mutual models to other parts of the education sector”

(Hunt, 2014. p.34)

This can only mean the FE and HE sectors. There is, of course, only a small amount of work on what this might look like in HE. For all that they are educational institutions, Universities are vastly more complex than schools, and as independently incorporated bodies, are unlikely to rush into a new business model without careful consideration (whereas forced academization arguably played a significant role in the rapid growth of the co-operative schools movement). However, the development of a benefits-led case to support experiments in co-operative higher education could bear fruit.

Hunt also recommends a review of “the power of the private sector in the examination system and explore the potential of a school/college owned mutual alternative “. This might be a fertile area for a mutual experiment in higher education, especially given the groundwork that Michael Gove put in with drawing the Russell Group into A-level reform – there may be a greater appetite for this sort of work if Universities feel they are overseeing something that has broad backing from the schools sector, rather than being implicated in a top-down government drive to change exams.

Many of the other recommended provisions in the report are tangential to education, but would have a fundamental impact on a university converting to co-operative status. These include establishing a level playing field with other corporate forms, tax incentives, improved government support for mutuals, collection of data to support evidence-based policy relating to mutuals, legally-binding protection from asset-stripping and demutualisation, and crucially, new capital instruments for raising funds. All of which, if implemented, could make mutualisation a more attractive prospect for universities.

References

Hunt, P. (2014). The Hunt Review An independent review of the contribution that mutuals can make to growth, prosperity and fairness (p. 39). London: Mutuo. Retrieved from http://www.mutuo.co.uk/news/mutuals-policy-review-published/

National Center for Employee Ownership

I have discovered (through an endnote in Erdal, 2011) a great resource in the US National Centre for Employee Ownership, which describes itself as “a nonprofit membership and research organization that was founded in 1981 to provide most objective and reliable information possible on employee ownership at the most affordable price possible.”

(http://www.nceo.org/pages/nceo.php)

The NCEO also does a nice line in infographics:

The Economic Power of Employee Ownership

Infographic by National Center for Employee Ownership (NCEO) from The Economic Power of Employee Ownership

If you’re wondering what an ESOP is, there’s a snazzy infographic for that, too, which explains about Employee Share Ownership Plan legislation in the US:

What Is an ESOP

Infographic by National Center for Employee Ownership (NCEO) from What Is an ESOP?
In case you think this might be a minority thing in the US, over the pond it is understood as ‘shared capitalism’, and has a wide reach:
ESOPs in the U.S.

Infographic by National Center for Employee Ownership (NCEO) from ESOPs in the U.S.

While employee ownership does not necessitate identification as a co-operative, it is an element of co-operative identity. ESOPs do not have to have a majority share in company ownership, but many do, and there are considerable numbers at 100% ownership.

Central to the ESOP concept is the idea that a well-run firm will pay for itself over the long lerm, and so a loan can be used to purchase a company, rather than workers requiring access to capital (perhaps through a redundancy payout and savings) at a time of crisis. This framework makes an orderly transition towards employee ownership possible, and is something that bears wider attention. It has especial relevance to the HE sector, where institutions are normally fairly stable and long-lived organizations, and hence offer a sound bet for long-term loan financing.

 

References

Erdal, D. (2011). Beyond the corporation: humanity working. London: Bodley Head.

NMITE – planning to do things differently

Will NMITE be a co-operative? I can’t say, but it certainly plans to do things differently:

No departments, no faculties, no Council.  Instead, we’ll be developing teaching teams designed around the delivery of our unique engineering and Human Interaction© curriculum

(http://nmite.org.uk/faculty-staff/)

The curriculum comprises a great deal of interaction with industry, with an extended placement, and furthermore, promises to school students in a wide range of awareness, communication and collaborative working skills – it looks a lot like US-style co-operative education, but no explicit mention of co-operative principles/values, and the collaborative learning aspects are not foregrounded.

(http://nmite.org.uk/wp-content/uploads/2015/03/Curriculum-Summary-WO.pdf)

In terms of physical infrastructure, there is an extensive apparent desire to care for the community’s needs, by developing enviromentally-freindly “accommodation that reflects how NMITE intends to inspire, collaborate and connect with the community.” And, as co-operatives are known to have superior longevity and a tendency towards longer-term planning, NMITE likewise intends to be:

“putting decision making and development for the long term always before short term wins.”

(http://nmite.org.uk/campus/)

Co-operative or not, NMITE promises to be a positive educational development for an area that is currently underserved by Higher Education, and something new in UK Higher Education.