Unreserved Minutes of the HEA Board of Directors

Unreserved Minutes of the HEA Board of Directors

Meeting:Higher Education Academy Board of Directors

Date:25April 2012

Time:10:00 to 13:00

Venue:Boardroom, Woburn House, Tavistock Square, London

1.0Present

Directors

Professor Sir Bob Burgess (Chair)

Ms Rebecca Bunting

Mr Anthony Carey

Professor Tony Chapman

Mr Geoff Donnelly

Professor Janice Kay

Professor Mike Mannion

Professor Don Nutbeam

Mr Johnny Rich

Mr Rama Thirunamachandran

Observers

Mr Brian Baverstock, SFC

Ms Helen Bowles, GuildHE

Dr Lesly Huxley, LFHE

Mr William Locke, HEFCE

Ms Jayne Mitchell, QAA

Dr Cliona O’Neill, HEFCW

Mr Greg Wade, UUK

HEA Executive

Professor Craig Mahoney, Chief Executive

Professor Phil Levy, Deputy Chief Executive (Academic)

Mr Sean Mackney, Senior Deputy Chief Executive

Professor Stephanie Marshall, Deputy Chief Executive (Research and Policy)

Ms Caroline Thomas, Company Secretary

HEA Staff

Dr Rajesh Dhimar, Academic Development Officer (PSF & Recognition)

Mrs Lynda Massey, Executive Assistant

Dr Alastair Robertson, National Coordinator (Scotland)

Apologies

Mr Robert Barlow

Mr Liam Burns

Professor Duncan Lawson, Assistant Chief Executive

Professor Peter Lutzeier

Ms Patricia McVeigh, DELNI

2.0Welcomeand introductions

2.1The Chair welcomed everyone to the meeting, in particular HEA colleagues who were attendingthis meeting to gain an insight into work of the Board and the Executive. A particular welcome was extended to Professor Phil Levy who joined the HEA Executive as Deputy Chief Executive (Academic) inFebruary 2012.

3.0Declarations of interest

3.1No declarations of interest were reported at the meeting.

4.0Minutes– RESOLVED (HEAB 04/12) – That the Minutes of the meeting held on 25 January 2012 be approved as an accurate record and signed by the Chair.

5.0Matters arising – There were no matters arising.

6.0Chief Executive’s Report

(a)Overview of progress

6.1The Chief Executive updated the Board on key highlights, progress and achievements in the HEA’s work since the last Board meeting in January 2012. The positive media coverage from 1November 2011 to 16 April 2012 was noted.

6.2Particular reference was made to the 15 doctoral scholarships awarded by the HEA following 132 applications and the 14 international scholarships also awarded, following a nationally advertised programme. The international scholarships were prestigious awards designed to support individuals in the sector to undertake specific research work outside the UK for dissemination within the UK.

6.3A flexible learning summit of key stakeholders had been sponsored by the HEA earlier that week where the key findings of the HEA’s evaluation of the HEFCE funded flexible learning pathfinder projects were presented and a panel of experts invited to comment on their respective visions for flexible learning in light of the recommendations. This event had complemented a meeting of the PVC Network which considered the development of open educational resources (OER) in particular.

6.4Reference was made to the increasing interest in the HEA from overseas and in particular the links being made by the Chief Executive and Senior Deputy Chief Executive in Indonesia and Malaysia respectively.

6.5The Chief Executive and his deputies continued to represent learning and teaching in the sector and profile the work of the HEA through a number of external engagements and presentations across the sector. The HEA continued to work closely with other sector agencies including the Quality Assurance Agency (QAA), Leadership Foundation for Higher Education (LFHE) and the Joint Information Systems Committee (JISC)

6.6Seven outstanding institutional subscriptions remained. This included five new subscribers, recently invoiced, and two existing subscriptions, which were expected to pay shortly following Executive discussions with senior institutional representatives.

6.7Discussion focused on the perspectives of Vice-Chancellors being heard through a series of dinners hosted by the Chair and Chief Executive; the risk of higher than budgeted surpluses as detailed in the six-month reforecast; and the recent statement made by the President of NUS which called for a teaching qualification for university lecturers and the positioning of the HEA as part of that debate.

6.8While the professionalisation of teaching and development and application of the UK Professional Standards Framework (UKPSF) through the award of individual HEA Fellowship or HEA accreditation of initial and continuing professional development programmes were core business to the HEA, the Board was cautious over getting drawn into a highly political debate without an appropriate evidence base.

6.9Discussion ensued on the known influences of student choice of university and the work in train by the HEA to establish an evidence base in relation to the impact that the achievement of a teaching standard in higher education had on the student learning experience. While the Board was keen to be more proactive in taking positions and influencing the UK policy agenda, the importance of language in this area and the difference between a teaching qualification and being qualified, or equipped to teach, was noted.

6.10It was agreed that a paper on the issues relating to the professionalisation of teaching, including an account of the historical and current policy and cultural issues relating in the sector to the introduction of teaching standards; the discussion of potential metrics of excellent teaching; and links to the provision of student information would be debated at the next Board meeting in July.

(b) Operational Plan – half-year performance

6.11It was noted that there had been good progress against target in the first half of the 2011-12 academic year, especially in light of delays to the appointment of new HEA staff. The areas showing as behind target related mainly to specific support for Enhancing Learning through Technology (ELT). This would not however, affect delivery of the grant letter commitments to funding councils. The remaining areas identified as behind schedule were predicted to be fully completed by the end of the academic year. The report was received without discussion, following consideration by the Finance and General Purposes Committee (F&GP).

(c)Six-month reforecast of budget

6.12The Senior Deputy Chief Executive presented the annual reforecast budget for 2011-12.

The reforecast showed a higher than budgeted surplus of £112,000 against an original budget of £15,000 at the end of the financial year, which would take projected reserves to £3.602 million, and was at the upper end of the target range defined in the HEA reserves policy. The action being taken by the Executive to mitigate the risks associated with an ambitious programme of delivery was noted, including the scaling of projects wherever possible, subject to quality and alignment with HEA priorities. Most recently this included resourcing co-financed activities with major subject organisations and professional bodies, including the Nuffield Foundation, Department of Health and British Academy.

6.13The Chair of the Finance and General Purposes Committee reported that it had discussed the variances in detail, in particular the increase in staffing over associates across the year. 20 per cent of staff were on short fixed term contracts and the proportion of income spent on front line academic activities remained above 75 per cent. The Executive would continue to monitor this balance closely to ensure continued agility and responsiveness to changes in the sector context and funding environment.

6.14The advantages of secondments were discussed and currently accounted for 10 per cent of the HEA staffing profile. A more proactive exploration of this model with partner institutions would be considered by the Executive.

6.15It was noted that while HEFCE monitored HEA accounts to ensure appropriate spend of its own grant to the HEA and not the full funds of the charity, it still had a regulatory role in terms of assessing the risk of the organisations it funded across a number of areas including the achievement of aims and objectives, financial performance and audit findings.

RESOLVED (HEAB 05/12) – That the six-month reforecast be approved for monitoring purposes for the remainder of the 2011-12 academic year.

7.0Delivering the Strategy 2012-2016

(a)HEA Risk Appetite

7.1The Chair drew members’ attention to the draft statement of risk appetite provided for information to use in support of the Board’s discussions on the income and expenditure assumptions from 2012-1016 and its advice to the Executive on the ongoing development of a Business Development Plan. A more detailed discussion of risk appetite would be held at the Finance and General Purposes Committee in June in the context of the annual budget and priorities for 2012-13.

(b)Medium-term forecast budget 2012-2016

7.2The Senior Deputy Chief Executive introduced a financial forecast to the end of July 2016 aimed at the delivery of the targets contained in the Strategic Plan. The associated income and expenditure assumptions were outlined alongside the potential budgetary pressures in relation to income diversification, sector pay trends and the required level of reserves to support the organisation.

7.3Two alternative scenarios; one more pessimistic and one more optimistic had been modelled and demonstrated the flexibility of the HEA business model to increase or reduce its activity levels and staffing requirements to achieve a balanced budget without the need for further redundancies. It was noted that the Executive had been cautious to not overestimate potential income too soon and any resultant over commitment of staffing or expenditure while the business development strategy, content and delivery methods for a number of new services were being finalised.

7.4In discussing the assumptions it was suggested that the change in the HEA’s delivery model over a two year period in terms of the percentage of income invested in sector facing front line delivery be made more explicit in the budget presentation. Assurance that the HEA had the appropriate professional indemnity and liability insurances in relation to its business development activities was given.

RESOLVED (HEAB 06/12) – That the first year of the forecast be used a starting point for planning the 2012-13 operational budget, as recommended by the Finance and General Purposes Committee.

(c)Business Development – Developing the Business Plan

7.5The Senior Deputy Chief Executive sought the Board’s advice on the current stage of development of a business plan for the HEA’s income generation activities.

7.6It was noted that since the last meeting of the Board further work had been completed to ensure the HEA was able to operate entrepreneurially and generate income from UK and international sources. A clear offer of products and services to subscribing institutions; new processes for delivering consultancy and winning contracts; marketing materials for a range of clients; supporting information systems and the re-engineering of a number of HEA processes had all served to create the foundations for an effective diversification strategy. New partnerships had been developed with key bodies including the HE International Unit, UK Trade and Investment(UKTI), the European Universities Association and the British Council.

7.7The supporting paper outlined a number of priority products and markets for proactive business development and set out a delivery plan which showed financial projections for income, defined key areas of risk and outlined the need to appraise opportunities against a set of ethical principles, as recommended by the Audit Committee.

7.8The Board strongly supported the development of the Plan to date and outlined a number of other potential commercial activities that could be explored including opportunities in relation to education and training in the health sector; links to doctoral study and demand for internationally recognised qualifications in Indonesia and Brazil; an alumni development programme; and services offered through the QS World University Ranking.

7.9Further detail was requested on the cost of projected sales and its representation in the forecast. The need to ensure a high enough margin to reflect the costs and associated risks associated with international projects was noted and the Executive was asked to explore the assumptions regarding the levels of senior HEA staff time required to secure, plan and manage international projects further.

7.10A further iteration would be presented to the July Board meeting which would explore the following issues in more detail:

• Investment costs in each of the proposed activities in relation to expected returns on that investment
• The linkages of each planned priority across the four priorities of the Strategic Plan to ensure consistency with the mission of the organisation
• Quality assurance mechanisms in relation to an international individual membership offer in certain countries and the costs of protecting the reputation of the HEA
• What the consultancy model would look like once income reached £8million per annum in terms of an international staffing base with a presence in key countries
• Consideration of the suitability of current staff to work in different cultural contexts and assurance regarding the continuity of quality support to HEIs in the UK and the continued high quality development of the HEA brand.
• A supporting sales and marketing plan
• The point at which the establishment of a trading arm would be desirable and the associated governance implications

(d)Operational Priorities 2012-13

7.13TheChief Executive presented the operational priorities for 2012-13 against each of the strategic priorities.

7.14It was agreed that the plans to work with HR Directors would be particularly valuable to institutions in looking at reward strategies for educational leadership. Consideration would be given more generally to the HEA’s relationship with students and potential to use them more actively as partners and co-producers of knowledge. The links between the HEA and students as part of the business development strategy and potential role in building the HEA brand would be considered.

8.0Board Effectiveness Review – Outcomes

8.1The Chair introduced a discussion on Board effectiveness, following an evaluation undertaken at the end of 2011. The Company Secretary presented the key findings which included a number of improvements since 2009, namelya much improved strategic focus of Board discussions and supporting documentation; the development of shared vision between the Board and Executive; and a more proactive role taken by Board members in enhancing the HEA’s value and reputation through key external engagements and representation.

8.4Areas for further development included improved communication from the committees through to the Board and a number of actions had already been implemented including an update and key messages item from each sub-committee Chair at Board meetings and the introduction of a monthly Board e-bulletin and secure webspace for papers and on-line discussion

8.5The establishment of a Board Working Group to support and advise the Executive on its business development planning would be explored further with members of the Governance and Nominations Committee. The importance of ensuring that an appropriate distinction between governance and management was maintained was noted.

8.6The Board welcomed the findings and noted that the priority areas identified by participants would be included in the work plan for the Board for 2012-13.

9.0Board Committees – Updates and key messages

(a) Audit Committee

9.1Geoff Donnelly, Chair of the Audit Committee, highlighted a number of issues considered at its last meeting including the:

• Consideration of the risks associated with international HEA activity, particularly relating to brand, intellectual property and cultural differences
• Endorsement of the Information Strategy and progress made in developing this cross-organisational approach to the use of information.
• Continued improvement to risk management processes and consideration of risk as part of key strategic documents.

9.2The Minutes of the meeting held on 29 February 2012 were received.

(b) Finance and General Purposes

9.3Rama Thirunamachandran, Chair of the Finance and General Purposes Committee (F&GP)highlighted a number of key issues agreed at the last two meetings of F&GP. This included:

• The agreement of a new pay, performance and reward policy which supported the new ethos and working practices of the HEA

• Agreed revisions to the Treasury Management Policy to enable the HEA to reduce treasury management risk following the downgrade of the HEA’s banks by Moody’s to below the HEA’s target range. The amendments moved the minimum credit level rating from Aa to A3 to reflect the current rating of all European banks and provided the ability to invest in an international bank with a UK presence where it had a higher credit rating than a UK bank.

9.4The Minutes of the meetings held on 18 January 2012 and 26 March 2012 were received.

RESOLVED (HEAB 07/12) – That the Health, Safety and Welfare Policy as signed by the Chair and Chief Executive be noted, in accordance with the Board’s statutory responsibilities for the health, safety and welfare of its employees.

10.0Board and Committee Meeting Dates 2012-13 – RESOLVED (HEAB 0*/12) – That the schedule of HEA Board and committee meetings dates for 2012-13 be approved.

(It was noted that the date of the June/July 2013 meeting would be confirmed alongside the date of the HEA Annual Conference)

11.0Any other business as notified to the Chair in advance

11.1The Chair congratulated HEA colleagues on the impressive marketing material distributed to the Board. The Senior Deputy Chief Executive and Company Secretary were to be available over lunch to demonstrate and discuss the development of management information and a new website for Board colleagues to access papers and key HEA information respectively.

12.0Date of next meeting –Wednesday 4 July 2012 – 16:00 – 19:00, Manchester University, followed by dinner at The Midland Hotel, Manchester.

The meeting concluded at approximately 12:30pm.

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