Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) H Foreword igher education institutions (HEIs) form a critical part of Scotland’s national fabric, with significant impact locally, nationally and internationally. They prepare the next generation of highly educated and skilled individuals, opening doors and transforming lives in the process. They address the major social and scientific issues facing the country and the wider world and play vital roles in communities and the nation’s cultural life. Collectively, HEIs form one of Scotland’s leading economic sectors and are key to producing sustainable, inclusive economic growth. While HEIs have in common the core activities of teaching, research and knowledge exchange, as autonomous institutions their missions, strategic priorities, institutional histories and constitutions may differ. HEIs receive substantial amounts of funding from both public and private sources, to deliver diverse outcomes to many beneficiaries. This means that they, and those involved in their governance, have responsibilities towards a particularly wide range of stakeholders. These include the institutions’ students and staff, its alumni, employers of graduates, partners in research and development, the Scottish and UK governments (through the Scottish Funding Council and the UK Research Councils in particular) and other funders, including international partners. The unique position and status of HEIs places special responsibilities on their governing bodies. HEIs serve the common good. As autonomous organisations, they have to generate income, innovate and invest to develop and sustain excellence in all their activities and remain competitive on a global stage. Those involved in the governance of higher education institutions therefore must balance the need for coherent strategy and sound financial management with the responsibility to bring benefit to higher education’s many stakeholders and society in general. In addition, all of Scotland’s HEIs have charitable status, placing on their governing bodies the legal responsibilities of trustees. Reflecting these responsibilities and expectations, this Code underpins the sector’s commitment to high standards of governance. Governing bodies have a responsibility to lead by Scottish Code of Good Higher Education Governance example, guiding the development of the institution’s ethics (2017 edition) and values and demonstrating these in the governing body’s own actions. This means that they must show leadership and Note on the second edition of the Code integrity not only in the decisions they make but also in the This is the 2017 edition of the Code. It is the output of a review way they conduct their business. In particular, the governing of the original Code, which was published in 2013. The present body has to both lead and exemplify the institution’s edition, once fully adopted, entirely replaces the 2013 Code. approach to equality and diversity and to social responsibility. 2 3 Scottish Code of Good Higher Education Governance (2017 edition) H Foreword igher education institutions (HEIs) form a critical part of Scotland’s national fabric, with significant impact locally, nationally and internationally. They prepare the next generation of highly educated and skilled individuals, opening doors and transforming lives in the process. They address the major social and scientific issues facing the country and the wider world and play vital roles in communities and the nation’s cultural life. Collectively, HEIs form one of Scotland’s leading economic sectors and are key to producing sustainable, inclusive economic growth. While HEIs have in common the core activities of teaching, research and knowledge exchange, as autonomous institutions their missions, strategic priorities, institutional histories and constitutions may differ. HEIs receive substantial amounts of funding from both public and private sources, to deliver diverse outcomes to many beneficiaries. This means that they, and those involved in their governance, have responsibilities towards a particularly wide range of stakeholders. These include the institutions’ students and staff, its alumni, employers of graduates, partners in research and development, the Scottish and UK governments (through the Scottish Funding Council and the UK Research Councils in particular) and other funders, including international partners. The unique position and status of HEIs places special responsibilities on their governing bodies. HEIs serve the common good. As autonomous organisations, they have to generate income, innovate and invest to develop and sustain excellence in all their activities and remain competitive on a global stage. Those involved in the governance of higher education institutions therefore must balance the need for coherent strategy and sound financial management with the responsibility to bring benefit to higher education’s many stakeholders and society in general. In addition, all of Scotland’s HEIs have charitable status, placing on their governing bodies the legal responsibilities of trustees. Reflecting these responsibilities and expectations, this Code underpins the sector’s commitment to high standards of governance. Governing bodies have a responsibility to lead by Scottish Code of Good Higher Education Governance example, guiding the development of the institution’s ethics (2017 edition) and values and demonstrating these in the governing body’s own actions. This means that they must show leadership and Note on the second edition of the Code integrity not only in the decisions they make but also in the This is the 2017 edition of the Code. It is the output of a review way they conduct their business. In particular, the governing of the original Code, which was published in 2013. The present body has to both lead and exemplify the institution’s edition, once fully adopted, entirely replaces the 2013 Code. approach to equality and diversity and to social responsibility. 2 3 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) The Code applies in a complex context of other regulatory and legislative requirements with which HEIs must comply. These include not only Scottish The form of this Code and UK laws relating specifically to higher education, but also (among others): This Code is concerned with governance of the institution and is organised into sections thematically. Each section starts with the high-level principles • charities law and regulations overseen by the Office of the Scottish Charity of good governance in the relevant area. More detailed provisions follow in Regulator (OSCR); the subsequent paragraphs. • the requirements of the Scottish Funding Council, including those laid The more detailed provisions of the Code specify how the high-level down in its Financial Memorandum and Accounts Direction; principles should be put into practice. The left-hand margin is used to show • the Statement of Recommended Practice for Further and Higher Education how different paragraphs relate to different elements of the high-level (SORP2015); principles. The whole Code is subject to the ‘comply or explain’ approach, • relevant company law; but naturally some provisions are to a greater extent obligatory, being more • equality law and associated duties; fundamental to good governance. The strength of the requirement for • legislation on health and safety and on the protection of children and compliance is indicated systematically as follows: vulnerable adults; • Where must is used, this indicates something that is obligatory either • Freedom of Information and Data Protection legislation; because it is a legislative or regulatory requirement or because it is • procurement law; fundamental to good higher education governance. Compliance is therefore required in all of these cases. The number of instances has • complaints handling requirements overseen by the Scottish Public been kept to a minimum. Sector Ombudsman; • Where expected is used, this indicates a strong presumption that • the requirements of professional bodies and other regulators relevant to compliance will be achieved in normal circumstances, but there the wide range of HEIs’ activity, including QAA Scotland. may be cases in which an alternative approach to good governance can be justified. As part of the wider legal framework, the Scottish Funding Council requires • Statements that use the verb should also bring an expectation of institutions to comply with principles of good governance as a condition of compliance in most circumstances, but with a recognition that there a grant of public funding. This Code sets out an appropriate set of principles may be situations in which a departure can be justified or it would be for this purpose. reasonable and acceptable to meet the principles of good governance in alternative ways. Balancing the diversity and autonomy of Scotland’s higher education institutions with the need for a common understanding of the highest standards of governance, the Code contains both high-level principles and Where institutions invoke ‘comply or explain’, whether in relation to an more detailed provisions. In such a diverse sector it is possible that certain expect statement or a should statement, they must demonstrate how of the principles can be met in ways that are different from those envisaged the relevant high-level principle of good governance is met in some in the specifics of the Code. The Code should be applied with attention alternative way. to the principles of proportionality and of relevance to the nature of the individual institution, this being particularly important in the case of the This Code does not list examples of good practice, which can be expected Small Specialist Institutions. to vary widely across such a diverse set of institutions and over time. HEIs should work together, and with stakeholder representatives, to create and Accordingly, the Code is issued on a ‘comply or explain’ basis. This approach maintain a public repository of examples of best practice as a live resource is widely accepted as the most effective way of achieving good governance. and so to promote continuous improvement in governance practices Institutions must report in the corporate governance statement of their across the sector. Student representatives should also, in conjunction with annual audited financial statements (Annual Reports) the extent of their their institutions, develop their own best practice to help support student compliance with the Code. If an institution’s practices are not consistent with governing body members to meet the particular challenges of their short particular provisions of the Code, an explanation must be published in that terms of office on governing bodies. statement. Such exceptions must be explained in terms of the institution’s particular circumstances and/or operating model. Matters not explicitly covered within this Code, or which emerge over time, should be considered in the spirit of this Code and its underlying principles of openness and transparency in pursuit of good governance. 4 5 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) The Code applies in a complex context of other regulatory and legislative requirements with which HEIs must comply. These include not only Scottish The form of this Code and UK laws relating specifically to higher education, but also (among others): This Code is concerned with governance of the institution and is organised into sections thematically. Each section starts with the high-level principles • charities law and regulations overseen by the Office of the Scottish Charity of good governance in the relevant area. More detailed provisions follow in Regulator (OSCR); the subsequent paragraphs. • the requirements of the Scottish Funding Council, including those laid The more detailed provisions of the Code specify how the high-level down in its Financial Memorandum and Accounts Direction; principles should be put into practice. The left-hand margin is used to show • the Statement of Recommended Practice for Further and Higher Education how different paragraphs relate to different elements of the high-level (SORP2015); principles. The whole Code is subject to the ‘comply or explain’ approach, • relevant company law; but naturally some provisions are to a greater extent obligatory, being more • equality law and associated duties; fundamental to good governance. The strength of the requirement for • legislation on health and safety and on the protection of children and compliance is indicated systematically as follows: vulnerable adults; • Where must is used, this indicates something that is obligatory either • Freedom of Information and Data Protection legislation; because it is a legislative or regulatory requirement or because it is • procurement law; fundamental to good higher education governance. Compliance is therefore required in all of these cases. The number of instances has • complaints handling requirements overseen by the Scottish Public been kept to a minimum. Sector Ombudsman; • Where expected is used, this indicates a strong presumption that • the requirements of professional bodies and other regulators relevant to compliance will be achieved in normal circumstances, but there the wide range of HEIs’ activity, including QAA Scotland. may be cases in which an alternative approach to good governance can be justified. As part of the wider legal framework, the Scottish Funding Council requires • Statements that use the verb should also bring an expectation of institutions to comply with principles of good governance as a condition of compliance in most circumstances, but with a recognition that there a grant of public funding. This Code sets out an appropriate set of principles may be situations in which a departure can be justified or it would be for this purpose. reasonable and acceptable to meet the principles of good governance in alternative ways. Balancing the diversity and autonomy of Scotland’s higher education institutions with the need for a common understanding of the highest standards of governance, the Code contains both high-level principles and Where institutions invoke ‘comply or explain’, whether in relation to an more detailed provisions. In such a diverse sector it is possible that certain expect statement or a should statement, they must demonstrate how of the principles can be met in ways that are different from those envisaged the relevant high-level principle of good governance is met in some in the specifics of the Code. The Code should be applied with attention alternative way. to the principles of proportionality and of relevance to the nature of the individual institution, this being particularly important in the case of the This Code does not list examples of good practice, which can be expected Small Specialist Institutions. to vary widely across such a diverse set of institutions and over time. HEIs should work together, and with stakeholder representatives, to create and Accordingly, the Code is issued on a ‘comply or explain’ basis. This approach maintain a public repository of examples of best practice as a live resource is widely accepted as the most effective way of achieving good governance. and so to promote continuous improvement in governance practices Institutions must report in the corporate governance statement of their across the sector. Student representatives should also, in conjunction with annual audited financial statements (Annual Reports) the extent of their their institutions, develop their own best practice to help support student compliance with the Code. If an institution’s practices are not consistent with governing body members to meet the particular challenges of their short particular provisions of the Code, an explanation must be published in that terms of office on governing bodies. statement. Such exceptions must be explained in terms of the institution’s particular circumstances and/or operating model. Matters not explicitly covered within this Code, or which emerge over time, should be considered in the spirit of this Code and its underlying principles of openness and transparency in pursuit of good governance. 4 5 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Definitions Staff member Anyone serving on the governing body who is employed by the Institution, Governance arrangements in HEIs reflect the uniqueness and complexity of (of the governing body) except for those whose membership is on an ex officio basis; e.g. Principal higher education. Many of their numerous stakeholders are directly involved, or Vice Principal. (This includes Elected or Union staff members, as follows.) enhancing governance by contributing a wide range of skills, perspectives and experience. Given the variety of participants and roles, it is helpful to define Elected or Union staff member Anyone serving on the governing body in one of the capacities specified in some terms in advance, to allow for a more concise Code. subsections 10(1)(b-d) of the Higher Education Governance (Scotland) Act Throughout this Code, the following definitions of key terms are assumed, 2016. These are: except where an alternative definition is given explicitly: 1. Elected staff members: at least two members of the governing body must be appointed “by being elected by the staff of the institution from among their own number”. 2. Trade union nominees, of which at least one must be nominated by a union representing academic staff and one by a union representing non-academic staff. Student member A member of the governing body who is a registered student of the Institution and/or an officer of the student association, nominated to the governing body by that association or on an ex officio basis. Chair The responsibilities of the position of ‘Senior Lay Member’ in relation to the role of Chair are set out in the Higher Education Governance (Scotland) Act 2016. The Rector may also carry out some of the roles of Chair at the Ancient universities, as prescribed in older legislation. Principal The de facto Head of Institution and the Institution’s chief executive officer in the terms of the SFC’s Financial Memorandum. This includes the position of Director of the Glasgow School of Art and the position of Principal and Vice Chancellor at other Institutions. Lay member A member of the governing body who is neither an employee nor a student of the Institution. Where appropriate, a further distinction is drawn in the text of the Code between lay governing body members who are appointed by the governing body and other lay members (the latter group including the Senior Lay Member, any members appointed or elected by alumni groups, any representative of the local or regional authority appointed in accordance with the statutes of a particular HEI and, in some HEIs, Rector’s or Chancellor’s Assessors). External lay committee member A lay member of one of the governing body’s committees who is not a member of the governing body itself. It is common practice to appoint such external members to committees in order to bring in specific expertise. Committee membership can also provide individuals with experience of HE governance without taking on the full responsibilities of governing body membership. Executive officer A member of the Institution’s management team who is not a member of the governing body (i.e. here this term is not used to denote the Principal or any other members of the governing body). 6 7 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Definitions Staff member Anyone serving on the governing body who is employed by the Institution, Governance arrangements in HEIs reflect the uniqueness and complexity of (of the governing body) except for those whose membership is on an ex officio basis; e.g. Principal higher education. Many of their numerous stakeholders are directly involved, or Vice Principal. (This includes Elected or Union staff members, as follows.) enhancing governance by contributing a wide range of skills, perspectives and experience. Given the variety of participants and roles, it is helpful to define Elected or Union staff member Anyone serving on the governing body in one of the capacities specified in some terms in advance, to allow for a more concise Code. subsections 10(1)(b-d) of the Higher Education Governance (Scotland) Act Throughout this Code, the following definitions of key terms are assumed, 2016. These are: except where an alternative definition is given explicitly: 1. Elected staff members: at least two members of the governing body must be appointed “by being elected by the staff of the institution from among their own number”. 2. Trade union nominees, of which at least one must be nominated by a union representing academic staff and one by a union representing non-academic staff. Student member A member of the governing body who is a registered student of the Institution and/or an officer of the student association, nominated to the governing body by that association or on an ex officio basis. Chair The responsibilities of the position of ‘Senior Lay Member’ in relation to the role of Chair are set out in the Higher Education Governance (Scotland) Act 2016. The Rector may also carry out some of the roles of Chair at the Ancient universities, as prescribed in older legislation. Principal The de facto Head of Institution and the Institution’s chief executive officer in the terms of the SFC’s Financial Memorandum. This includes the position of Director of the Glasgow School of Art and the position of Principal and Vice Chancellor at other Institutions. Lay member A member of the governing body who is neither an employee nor a student of the Institution. Where appropriate, a further distinction is drawn in the text of the Code between lay governing body members who are appointed by the governing body and other lay members (the latter group including the Senior Lay Member, any members appointed or elected by alumni groups, any representative of the local or regional authority appointed in accordance with the statutes of a particular HEI and, in some HEIs, Rector’s or Chancellor’s Assessors). External lay committee member A lay member of one of the governing body’s committees who is not a member of the governing body itself. It is common practice to appoint such external members to committees in order to bring in specific expertise. Committee membership can also provide individuals with experience of HE governance without taking on the full responsibilities of governing body membership. Executive officer A member of the Institution’s management team who is not a member of the governing body (i.e. here this term is not used to denote the Principal or any other members of the governing body). 6 7 1 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) The Governing Body: 5. The governing body should satisfy itself that the Institution has adequate Primary responsibilities systems and practices for informing and consulting with stakeholders’ representative bodies, including recognised trade unions and student associations, in relation to the on-going development of the Institution The governing body must take responsibility for ensuring the and any significant proposals regarding relevant institutional policies. The effective management of the Institution, planning the Institution’s governing body should also satisfy itself that the Institution has in place strategic direction and future development and advancing its appropriate arrangements for engaging with the public and the wider mission. The governing body has ultimate responsibility for communities which it serves. all the affairs of the Institution and must ensure that there are 6. The governing body should satisfy itself that the Institution’s students’ appropriate arrangements for financial management. It must association is properly resourced and supported to function as an effective satisfy itself that the Institution is compliant with all relevant and autonomous organisation. The Institution has a legal obligation to legal and regulatory obligations and operates with high levels of take reasonable steps to ensure that the students’ association operates social responsibility. The governing body must adopt and publish a in a fair and democratic manner and that the students’ association is Statement of Primary Responsibilities. accountable for its finances. The governing body must 7. The Institution’s financial regulations must specify the financial The governing body must 1. The governing body must enable the Institution to achieve and develop its responsibilities and authority of the governing body, its committees, and ensure that the Institution has take responsibility for mission and primary objectives of learning and teaching and research. appropriate arrangements for staff. Financial procedures should specify processes to be followed in day- ensuring the effective 2. The members of a governing body, collectively and individually, must act to-day financial transactions. There should be clear policies on a range of financial management. management of the in accordance with the Nine Principles of Public Life in Scotland,1 which systems, including (but not limited to) treasury management, investment Institution, planning the should be the foundation for the governing body’s behaviour and its management, risk management, debt management, and grants and decision-making processes. They are: contracts. These should be monitored to enable continuous improvement. Institution’s strategic direction • Duty and future development and • Selflessness advancing its mission. The The governing body must 8. Legal and regulatory obligations include compliance with all relevant laws, • Integrity governing body has ultimate satisfy itself that the the governing instruments of the Institution, relevant financial standards • Objectivity including the Scottish Funding Council’s Financial Memorandum, and any responsibility for all the Institution is compliant • Accountability and Stewardship legal obligations arising in connection with the Institution’s charitable affairs of the Institution. with all relevant legal and • Openness and/or company status, in addition to the observance (on a comply or regulatory obligations. explain basis) of this Code. • Honesty • Leadership 9. The governing body is expected to review regularly its policies relating to • Respect compliance with statutory duties. 3. The governing body must be involved in the development of, take responsibility for, and monitor performance against the Institution’s strategic plan, which sets the aims and objectives of the Institution and identifies The governing body must 10. The governing body must satisfy itself that the Institution’s policies and the financial, physical and staffing strategies necessary to achieve these satisfy itself that the actions are ethical and sustainable, taking into consideration their impact objectives. It is also expected to approve an annual plan that identifies those Institution operates with high on the environment, on the wellbeing of its students and workforce, aspects of the strategic plan being implemented in the year in question. including health and safety issues and fair working practices, and on other levels of social responsibility. communities, whether local or more distant. 4. The governing body must be attentive to risks which could threaten the sustainability of the Institution, including the risk of inaction in the face of threat or opportunity, and ensure that the Institution has appropriate procedures to identify and actively manage risk. The governing body is responsible for determining the nature and extent of the principal risks it is willing to take in pursuing its strategic plan. Institutions should maintain a risk register and are expected to provide an annual disclosure about risk management in audited financial statements. 1 While higher education institutions are not public bodies, the Nine Principles of Public Life in Scotland, which incorporate the seven ‘Nolan Principles’, provide an appropriate and recognised definition of ethical and responsible behaviour for those involved in higher education governance. 8 9 1 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) The Governing Body: 5. The governing body should satisfy itself that the Institution has adequate Primary responsibilities systems and practices for informing and consulting with stakeholders’ representative bodies, including recognised trade unions and student associations, in relation to the on-going development of the Institution The governing body must take responsibility for ensuring the and any significant proposals regarding relevant institutional policies. The effective management of the Institution, planning the Institution’s governing body should also satisfy itself that the Institution has in place strategic direction and future development and advancing its appropriate arrangements for engaging with the public and the wider mission. The governing body has ultimate responsibility for communities which it serves. all the affairs of the Institution and must ensure that there are 6. The governing body should satisfy itself that the Institution’s students’ appropriate arrangements for financial management. It must association is properly resourced and supported to function as an effective satisfy itself that the Institution is compliant with all relevant and autonomous organisation. The Institution has a legal obligation to legal and regulatory obligations and operates with high levels of take reasonable steps to ensure that the students’ association operates social responsibility. The governing body must adopt and publish a in a fair and democratic manner and that the students’ association is Statement of Primary Responsibilities. accountable for its finances. The governing body must 7. The Institution’s financial regulations must specify the financial The governing body must 1. The governing body must enable the Institution to achieve and develop its responsibilities and authority of the governing body, its committees, and ensure that the Institution has take responsibility for mission and primary objectives of learning and teaching and research. appropriate arrangements for staff. Financial procedures should specify processes to be followed in day- ensuring the effective 2. The members of a governing body, collectively and individually, must act to-day financial transactions. There should be clear policies on a range of financial management. management of the in accordance with the Nine Principles of Public Life in Scotland,1 which systems, including (but not limited to) treasury management, investment Institution, planning the should be the foundation for the governing body’s behaviour and its management, risk management, debt management, and grants and decision-making processes. They are: contracts. These should be monitored to enable continuous improvement. Institution’s strategic direction • Duty and future development and • Selflessness advancing its mission. The The governing body must 8. Legal and regulatory obligations include compliance with all relevant laws, • Integrity governing body has ultimate satisfy itself that the the governing instruments of the Institution, relevant financial standards • Objectivity including the Scottish Funding Council’s Financial Memorandum, and any responsibility for all the Institution is compliant • Accountability and Stewardship legal obligations arising in connection with the Institution’s charitable affairs of the Institution. with all relevant legal and • Openness and/or company status, in addition to the observance (on a comply or regulatory obligations. explain basis) of this Code. • Honesty • Leadership 9. The governing body is expected to review regularly its policies relating to • Respect compliance with statutory duties. 3. The governing body must be involved in the development of, take responsibility for, and monitor performance against the Institution’s strategic plan, which sets the aims and objectives of the Institution and identifies The governing body must 10. The governing body must satisfy itself that the Institution’s policies and the financial, physical and staffing strategies necessary to achieve these satisfy itself that the actions are ethical and sustainable, taking into consideration their impact objectives. It is also expected to approve an annual plan that identifies those Institution operates with high on the environment, on the wellbeing of its students and workforce, aspects of the strategic plan being implemented in the year in question. including health and safety issues and fair working practices, and on other levels of social responsibility. communities, whether local or more distant. 4. The governing body must be attentive to risks which could threaten the sustainability of the Institution, including the risk of inaction in the face of threat or opportunity, and ensure that the Institution has appropriate procedures to identify and actively manage risk. The governing body is responsible for determining the nature and extent of the principal risks it is willing to take in pursuing its strategic plan. Institutions should maintain a risk register and are expected to provide an annual disclosure about risk management in audited financial statements. 1 While higher education institutions are not public bodies, the Nine Principles of Public Life in Scotland, which incorporate the seven ‘Nolan Principles’, provide an appropriate and recognised definition of ethical and responsible behaviour for those involved in higher education governance. 8 9 2 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) The governing body 11. The Statement of Primary Responsibilities is expected to include, as a The Governing Body: Membership must adopt and publish minimum, provisions that relate to: The governing body must have a balance of skills and experience a Statement of Primary • protecting the reputation and values of the Institution; among its members sufficient to enable it to meet its primary Responsibilities. • ensuring, in conjunction with the academic board, the quality of the responsibilities and foster stakeholder confidence. It must have a Institution’s educational provision and adequate provision for the majority of lay members and should be no larger than is necessary to general welfare of students; meet legal requirements on membership and to ensure appropriate • approving the mission and strategic vision of the Institution, its coverage of skills and stakeholder involvement. The recruitment of strategic plan, key performance indicators (KPIs) and annual budgets, members appointed by the governing body must proceed through ensuring that they have due regard to the interests of students, staff and other stakeholders, and monitoring institutional performance in an open and inclusive process that is based on a skills evaluation. terms of these; • appointing the Head of the Institution (the Principal) as chief executive The governing body must 15. The governing body is expected to draw up and make public a register of officer of the Institution and putting in place suitable arrangements for have a balance of skills the balance of skills, attributes and experience required in the membership monitoring their performance; and experience among of the governing body, to inform the recruitment of appointed lay members • appointing the Secretary to the governing body; of the governing body as well as regular assessment of the balance of skills its members sufficient to across the membership of the governing body. • ensuring the establishment and monitoring of systems of control enable it to meet its primary and accountability, including financial and operational controls, responsibilities and foster 16. By law, governing bodies must include at least two members “appointed risk management, means of evaluating the governing body’s own by being elected by the staff of the Institution from among their own stakeholder confidence. It performance and clear procedures for handling internal grievances and number”. In devising a process or processes for appointing these members, must have a majority of lay Institutions should have regard to the importance of maintaining adequate “whistleblowing” complaints and for managing conflicts of interest. members and should be no representation from both the academic and non-academic staff bodies, 12. This Statement must be included in the Institution’s Annual Report, along larger than is necessary to building on current practice where appropriate. with a broad summary of the authority that the governing body delegates meet legal requirements 17. All Institutions are expected to make clear in their annual reports how to management, its committees and the academic board. The Annual Report must be published on the Institution’s website. and ensure appropriate the size, and composition of the governing body (and any change in the coverage of skills and size or composition) contributes to maintaining a coherent and effectively 13. The governing body may delegate authority or allocate some of its work stakeholder involvement. functioning governing body, as well as meeting statutory requirements on to committees, grant delegated authority to the Chair or a committee to membership and the need for an appropriate range of skills and experience. act on its behalf, and delegate authority to the Principal and other officers of the Institution. Such delegations must be clearly defined in a schedule of delegation that is formally approved by the governing body. Having The recruitment of members 18. Institutions are expected to advertise vacancies for appointed lay members delegated authority to other bodies or individuals to act on its behalf, the appointed by the governing within and outside the Institution, using a job specification and a clear governing body is nevertheless still ultimately accountable and assumes body must proceed through indication of the skills, knowledge and experience required. collective responsibility for the actions taken. an open and inclusive 19. Lay members who are appointed by the governing body must be appointed process that is based on a for a given term, which may be renewable, subject to satisfactory 14. In deciding which tasks should be delegated to committees, the governing performance. The renewal of any appointment must not be automatic, but body must retain a formal schedule of matters reserved to it for its skills evaluation. should be recommended by the nominations committee or equivalent (see collective decision.2 Such matters are likely to include final decisions on Section 7). Service beyond three terms of three years, or two terms of four issues of institutional strategy; the review and approval of the Institution’s years, should be avoided (exceptions, such as retention of a particular skill annual budget and Annual Report; and the appointment and dismissal of or expertise, may be permitted, but must be explained). After this point the Principal and of the Secretary to the governing body. members should normally retire and be replaced by new members. Such limits on periods of office should also be observed by those constituencies which appoint or elect members to the governing body. 20. Where an existing member of the governing body is elected to serve as Chair, that member should automatically begin a new term of membership linked to the office. However, consideration should be given to limiting the new Chair to a single term of office where that person has already served for a substantial period on the governing body. The governing body or relevant committee should consider this point when formulating the rules 2 The governing instruments of some Institutions list key powers that the governing body may not delegate. for eligibility to stand for election to the Senior Lay Member position. 10 11 2 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) The governing body 11. The Statement of Primary Responsibilities is expected to include, as a The Governing Body: Membership must adopt and publish minimum, provisions that relate to: The governing body must have a balance of skills and experience a Statement of Primary • protecting the reputation and values of the Institution; among its members sufficient to enable it to meet its primary Responsibilities. • ensuring, in conjunction with the academic board, the quality of the responsibilities and foster stakeholder confidence. It must have a Institution’s educational provision and adequate provision for the majority of lay members and should be no larger than is necessary to general welfare of students; meet legal requirements on membership and to ensure appropriate • approving the mission and strategic vision of the Institution, its coverage of skills and stakeholder involvement. The recruitment of strategic plan, key performance indicators (KPIs) and annual budgets, members appointed by the governing body must proceed through ensuring that they have due regard to the interests of students, staff and other stakeholders, and monitoring institutional performance in an open and inclusive process that is based on a skills evaluation. terms of these; • appointing the Head of the Institution (the Principal) as chief executive The governing body must 15. The governing body is expected to draw up and make public a register of officer of the Institution and putting in place suitable arrangements for have a balance of skills the balance of skills, attributes and experience required in the membership monitoring their performance; and experience among of the governing body, to inform the recruitment of appointed lay members • appointing the Secretary to the governing body; of the governing body as well as regular assessment of the balance of skills its members sufficient to across the membership of the governing body. • ensuring the establishment and monitoring of systems of control enable it to meet its primary and accountability, including financial and operational controls, responsibilities and foster 16. By law, governing bodies must include at least two members “appointed risk management, means of evaluating the governing body’s own by being elected by the staff of the Institution from among their own stakeholder confidence. It performance and clear procedures for handling internal grievances and number”. In devising a process or processes for appointing these members, must have a majority of lay Institutions should have regard to the importance of maintaining adequate “whistleblowing” complaints and for managing conflicts of interest. members and should be no representation from both the academic and non-academic staff bodies, 12. This Statement must be included in the Institution’s Annual Report, along larger than is necessary to building on current practice where appropriate. with a broad summary of the authority that the governing body delegates meet legal requirements 17. All Institutions are expected to make clear in their annual reports how to management, its committees and the academic board. The Annual Report must be published on the Institution’s website. and ensure appropriate the size, and composition of the governing body (and any change in the coverage of skills and size or composition) contributes to maintaining a coherent and effectively 13. The governing body may delegate authority or allocate some of its work stakeholder involvement. functioning governing body, as well as meeting statutory requirements on to committees, grant delegated authority to the Chair or a committee to membership and the need for an appropriate range of skills and experience. act on its behalf, and delegate authority to the Principal and other officers of the Institution. Such delegations must be clearly defined in a schedule of delegation that is formally approved by the governing body. Having The recruitment of members 18. Institutions are expected to advertise vacancies for appointed lay members delegated authority to other bodies or individuals to act on its behalf, the appointed by the governing within and outside the Institution, using a job specification and a clear governing body is nevertheless still ultimately accountable and assumes body must proceed through indication of the skills, knowledge and experience required. collective responsibility for the actions taken. an open and inclusive 19. Lay members who are appointed by the governing body must be appointed process that is based on a for a given term, which may be renewable, subject to satisfactory 14. In deciding which tasks should be delegated to committees, the governing performance. The renewal of any appointment must not be automatic, but body must retain a formal schedule of matters reserved to it for its skills evaluation. should be recommended by the nominations committee or equivalent (see collective decision.2 Such matters are likely to include final decisions on Section 7). Service beyond three terms of three years, or two terms of four issues of institutional strategy; the review and approval of the Institution’s years, should be avoided (exceptions, such as retention of a particular skill annual budget and Annual Report; and the appointment and dismissal of or expertise, may be permitted, but must be explained). After this point the Principal and of the Secretary to the governing body. members should normally retire and be replaced by new members. Such limits on periods of office should also be observed by those constituencies which appoint or elect members to the governing body. 20. Where an existing member of the governing body is elected to serve as Chair, that member should automatically begin a new term of membership linked to the office. However, consideration should be given to limiting the new Chair to a single term of office where that person has already served for a substantial period on the governing body. The governing body or relevant committee should consider this point when formulating the rules 2 The governing instruments of some Institutions list key powers that the governing body may not delegate. for eligibility to stand for election to the Senior Lay Member position. 10 11 3 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Responsibilities of All governing body 25. All governing body members must be considered full members of the Governing Body Members members assume the same governing body and treated as such. Once appointed, all members responsibilities as part of assume the same responsibilities, obligations and rights and should Governing body members must take collective responsibility be expected and supported to participate fully in all governing body the collective decision- for the governing body’s decisions. All members must exercise business, unless a clear conflict of interest is identified. The roles of the making body (apart from the their responsibilities in accordance with accepted standards of Chair, Rector (where there is one) and Principal have additional aspects, additional responsibilities which are prescribed in legislation, in institutional protocols and in this behaviour in public life and in the interests of the Institution as that attend particular offices, Code. Otherwise, there are different categories of member only in that a whole, rather than as representatives of any constituency. All including the roles of Chair, there exist distinct routes to appointment to the governing body. governing body members assume the same responsibilities as part Principal and, where there 26. Institutions are expected to set rules on committee memberships that of the collective decision-making body (apart from the additional is one, Rector). Conflicts of are consistent with this principle. Institutions’ rules must not preclude responsibilities that attend particular offices, including the roles interest must be considered membership of any of the governing body’s standing committees, with the of Chair, Principal and, where there is one, Rector). Conflicts of exception of the Audit Committee, purely on the basis of the category of and may affect a member’s interest must be considered and may affect a member’s ability to governing body member (in the sense of who appointed or elected that ability to participate in some participate in some governing body business. member). A conflict of interest may prevent a governing body member from governing body business. taking up membership of a particular committee. Other than this, the primary determinant of committee membership is that its members have the ability Governing body members 21. All governing body members are collectively responsible and accountable (the required skills and the time) to contribute effectively to the committee. must take collective for all the governing body’s decisions. Members should take an active part in all governing body business and should not confine their contributions 27. A member of a governing body who has a financial, family or other interest responsibility for the in any matter under discussion, at any meeting of the governing body or to matters that appear relevant to their background or the particular governing body’s decisions. one of its committees at which they are present, must, as soon as practicable, constituency that appointed or elected them. All members must exercise disclose the fact of this interest to the meeting. The same requirement 22. Members appointed or elected by a particular constituency, or otherwise applies to the Secretary and any executive officers who are present. their responsibilities in drawn from a particular sector or community, must not act as if delegated accordance with accepted 28. Where it is identified that a member of the governing body has a conflict of by that particular constituency. No member may be bound, when standards of behaviour interest with respect to a given matter, the Chair may, on the advice of the speaking or voting, by mandates given to them by others, or drawn from in public life and in the Secretary, request that the member in question withdraw from participation an electoral platform. This requirement is not only in line with principles in relevant business. Depending on the nature of the business, this may interests of the Institution of good governance but also essential to members’ responsibilities as allow for participation in discussions without taking part in decision-making as a whole, rather than as charity trustees.3 or may require complete non-participation and/or withdrawal from that a representative of 23. Members of the governing body must also take care not to become part of the meeting. any constituency. involved in the day-to-day executive management of the Institution, 29. A member of the governing body is not considered to have a financial excepting those who are employed by or are students of the Institution, interest in matters under discussion merely because they are a member of and in these cases only to the extent that they have executive staff or a student of the Institution. Nor does the restriction of involvement responsibilities in the course of their employment or their activities as in matters of direct personal or financial interest prevent members of the students or trade union representatives. governing body from remaining at a meeting which is considering, and 24. The governing body, acting as a whole, has the power to remove any voting, on proposals to insure the governing body against liabilities which member of the governing body from office,4 and should do so if the it might incur. member materially breaches the conditions of their appointment, including the requirements of this Code. The Institution must 30. The Institution is expected to publish the register of interests on its website, maintain and publicly suitably redacted to take account of data protection duties, and keep it up disclose a current register to date. The Secretary and any other senior officer closely associated with the work of the governing body, for example the Finance Director, must of interests of members also submit details of any interests to be included in the register. of the governing body. 31. The Institution is also expected to maintain robust and comprehensive policies on registering gifts and hospitality offered to governing body 3 On this point and other aspects of the charity trustee role, see http://www.oscr.org.uk/charities/guidance/guidance-and-good-practice-for-charity-trustees. members in relation to their role on the governing body, and to the 4 The Higher Education Governance (Scotland) Act 2016 sets out conditions on the rules that Institutions may Secretary and Finance Director. These policies should have regard to the adopt in respect of removal of any governing body member, including the Chair. overarching need for transparency in public life. 12 13 3 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Responsibilities of All governing body 25. All governing body members must be considered full members of the Governing Body Members members assume the same governing body and treated as such. Once appointed, all members responsibilities as part of assume the same responsibilities, obligations and rights and should Governing body members must take collective responsibility be expected and supported to participate fully in all governing body the collective decision- for the governing body’s decisions. All members must exercise business, unless a clear conflict of interest is identified. The roles of the making body (apart from the their responsibilities in accordance with accepted standards of Chair, Rector (where there is one) and Principal have additional aspects, additional responsibilities which are prescribed in legislation, in institutional protocols and in this behaviour in public life and in the interests of the Institution as that attend particular offices, Code. Otherwise, there are different categories of member only in that a whole, rather than as representatives of any constituency. All including the roles of Chair, there exist distinct routes to appointment to the governing body. governing body members assume the same responsibilities as part Principal and, where there 26. Institutions are expected to set rules on committee memberships that of the collective decision-making body (apart from the additional is one, Rector). Conflicts of are consistent with this principle. Institutions’ rules must not preclude responsibilities that attend particular offices, including the roles interest must be considered membership of any of the governing body’s standing committees, with the of Chair, Principal and, where there is one, Rector). Conflicts of exception of the Audit Committee, purely on the basis of the category of and may affect a member’s interest must be considered and may affect a member’s ability to governing body member (in the sense of who appointed or elected that ability to participate in some participate in some governing body business. member). A conflict of interest may prevent a governing body member from governing body business. taking up membership of a particular committee. Other than this, the primary determinant of committee membership is that its members have the ability Governing body members 21. All governing body members are collectively responsible and accountable (the required skills and the time) to contribute effectively to the committee. must take collective for all the governing body’s decisions. Members should take an active part in all governing body business and should not confine their contributions 27. A member of a governing body who has a financial, family or other interest responsibility for the in any matter under discussion, at any meeting of the governing body or to matters that appear relevant to their background or the particular governing body’s decisions. one of its committees at which they are present, must, as soon as practicable, constituency that appointed or elected them. All members must exercise disclose the fact of this interest to the meeting. The same requirement 22. Members appointed or elected by a particular constituency, or otherwise applies to the Secretary and any executive officers who are present. their responsibilities in drawn from a particular sector or community, must not act as if delegated accordance with accepted 28. Where it is identified that a member of the governing body has a conflict of by that particular constituency. No member may be bound, when standards of behaviour interest with respect to a given matter, the Chair may, on the advice of the speaking or voting, by mandates given to them by others, or drawn from in public life and in the Secretary, request that the member in question withdraw from participation an electoral platform. This requirement is not only in line with principles in relevant business. Depending on the nature of the business, this may interests of the Institution of good governance but also essential to members’ responsibilities as allow for participation in discussions without taking part in decision-making as a whole, rather than as charity trustees.3 or may require complete non-participation and/or withdrawal from that a representative of 23. Members of the governing body must also take care not to become part of the meeting. any constituency. involved in the day-to-day executive management of the Institution, 29. A member of the governing body is not considered to have a financial excepting those who are employed by or are students of the Institution, interest in matters under discussion merely because they are a member of and in these cases only to the extent that they have executive staff or a student of the Institution. Nor does the restriction of involvement responsibilities in the course of their employment or their activities as in matters of direct personal or financial interest prevent members of the students or trade union representatives. governing body from remaining at a meeting which is considering, and 24. The governing body, acting as a whole, has the power to remove any voting, on proposals to insure the governing body against liabilities which member of the governing body from office,4 and should do so if the it might incur. member materially breaches the conditions of their appointment, including the requirements of this Code. The Institution must 30. The Institution is expected to publish the register of interests on its website, maintain and publicly suitably redacted to take account of data protection duties, and keep it up disclose a current register to date. The Secretary and any other senior officer closely associated with the work of the governing body, for example the Finance Director, must of interests of members also submit details of any interests to be included in the register. of the governing body. 31. The Institution is also expected to maintain robust and comprehensive policies on registering gifts and hospitality offered to governing body 3 On this point and other aspects of the charity trustee role, see http://www.oscr.org.uk/charities/guidance/guidance-and-good-practice-for-charity-trustees. members in relation to their role on the governing body, and to the 4 The Higher Education Governance (Scotland) Act 2016 sets out conditions on the rules that Institutions may Secretary and Finance Director. These policies should have regard to the adopt in respect of removal of any governing body member, including the Chair. overarching need for transparency in public life. 12 13 4 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Equality and Diversity The governing body must 35. Having due regard to applicable law, best practice and the need for The governing body must provide leadership in equality monitor its own composition, appropriate skills and experience, the governing body is expected to and diversity across all protected characteristics, assuming establishing appropriate establish and regularly review appropriate goals and policies on equality and diversity with respect to the members it appoints.6 The governing responsibility for the Institution’s strategy and policy on goals and policies regarding body, through its nominations committee or equivalent, should take steps equality and diversity. This should not only ensure compliance the balance and diversity to open opportunity of membership to the widest possible range of well with all relevant legislative and regulatory requirements but of the members it appoints qualified potential members and to remove any unnecessary barriers to also actively promote and facilitate equality and diversity goals and regularly reviewing its membership. across the whole Institution. performance against these 36. The governing body should monitor equality and diversity (including, goals and policies. but not restricted to, gender balance) across the entire governing body. In addition, the governing body must monitor its own External organisations or electorates that appoint or elect governing composition, establishing appropriate goals and policies body members should be made aware of any significant imbalances and regarding the balance and diversity of the members it appoints should consider how they can contribute to increasing the diversity of the and regularly reviewing its performance against these goals governing body where appropriate. and policies. The governing body must 32. The governing body is responsible for compliance with all relevant provide leadership in legislative and regulatory requirements relating to equality and diversity. equality and diversity across The governing body is expected to approve the Institution’s equality and diversity policy and to satisfy itself that relevant policies have been all protected characteristics, implemented throughout the Institution. The governing body is expected assuming responsibility for to receive an equality monitoring report at least annually.5 This report the Institution’s strategy should include clear goals in relation to specified characteristics and and policy on equality and actions taken towards achieving these goals. diversity. This should not 33. Institutions must work to eliminate unlawful discrimination, promote only ensure compliance with and facilitate equality and foster good relations across all protected all relevant legislative and characteristics. The governing body is expected to show leadership in regulatory requirements pursuing these actions. but also actively promote 34. The governing body’s equality and diversity responsibilities should be and facilitate equality and included in the induction of new members. The need for additional diversity goals across the training in matters of equality and diversity should be assessed as part of whole Institution. regular reviews of the development needs of governing body members (see Section 5). 6 At the time of this Code’s publication (October 2017), relevant guidance includes the public commitment by the Chairs of all Scottish HEIs to maintaining or working towards gender-balance, defined as at least 40% women and at least 40% men, among the members directly appointed by governing bodies. More generally, 5 Where externally required reports fulfil this requirement, no additional reporting is required for the sake of the Equality Challenge Unit offers a range of useful resources including key guidance for governance at: this Code. http://www.ecu.ac.uk/publications/governing-bodies-equality-and-diversity. 14 15 4 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Equality and Diversity The governing body must 35. Having due regard to applicable law, best practice and the need for The governing body must provide leadership in equality monitor its own composition, appropriate skills and experience, the governing body is expected to and diversity across all protected characteristics, assuming establishing appropriate establish and regularly review appropriate goals and policies on equality and diversity with respect to the members it appoints.6 The governing responsibility for the Institution’s strategy and policy on goals and policies regarding body, through its nominations committee or equivalent, should take steps equality and diversity. This should not only ensure compliance the balance and diversity to open opportunity of membership to the widest possible range of well with all relevant legislative and regulatory requirements but of the members it appoints qualified potential members and to remove any unnecessary barriers to also actively promote and facilitate equality and diversity goals and regularly reviewing its membership. across the whole Institution. performance against these 36. The governing body should monitor equality and diversity (including, goals and policies. but not restricted to, gender balance) across the entire governing body. In addition, the governing body must monitor its own External organisations or electorates that appoint or elect governing composition, establishing appropriate goals and policies body members should be made aware of any significant imbalances and regarding the balance and diversity of the members it appoints should consider how they can contribute to increasing the diversity of the and regularly reviewing its performance against these goals governing body where appropriate. and policies. The governing body must 32. The governing body is responsible for compliance with all relevant provide leadership in legislative and regulatory requirements relating to equality and diversity. equality and diversity across The governing body is expected to approve the Institution’s equality and diversity policy and to satisfy itself that relevant policies have been all protected characteristics, implemented throughout the Institution. The governing body is expected assuming responsibility for to receive an equality monitoring report at least annually.5 This report the Institution’s strategy should include clear goals in relation to specified characteristics and and policy on equality and actions taken towards achieving these goals. diversity. This should not 33. Institutions must work to eliminate unlawful discrimination, promote only ensure compliance with and facilitate equality and foster good relations across all protected all relevant legislative and characteristics. The governing body is expected to show leadership in regulatory requirements pursuing these actions. but also actively promote 34. The governing body’s equality and diversity responsibilities should be and facilitate equality and included in the induction of new members. The need for additional diversity goals across the training in matters of equality and diversity should be assessed as part of whole Institution. regular reviews of the development needs of governing body members (see Section 5). 6 At the time of this Code’s publication (October 2017), relevant guidance includes the public commitment by the Chairs of all Scottish HEIs to maintaining or working towards gender-balance, defined as at least 40% women and at least 40% men, among the members directly appointed by governing bodies. More generally, 5 Where externally required reports fulfil this requirement, no additional reporting is required for the sake of the Equality Challenge Unit offers a range of useful resources including key guidance for governance at: this Code. http://www.ecu.ac.uk/publications/governing-bodies-equality-and-diversity. 14 15 5 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Effectiveness in particular, in order to maximise its usefulness during their limited terms of office. These reviews need not all be carried out by the Chair, On joining the governing body, new members must receive an though the Chair retains ultimate responsibility for the effectiveness of induction aimed at equipping them to be effective governing the governing body (see Section 6). body members when they commence the role. Opportunities for further development for all members should be provided regularly, The proceedings of 42. Governing bodies are expected to meet at least four times a year. in accordance with their individual needs and responsibilities. the governing body must Members should attend all meetings where possible. Details of the The proceedings of the governing body must be conducted in number of meetings of the governing body and its main committees, be conducted in a timely a timely and appropriately transparent manner. Key officers and rates of attendance of members, should be reported publicly. and appropriately of the executive should attend meetings to support effective 43. In addition to normal meetings of the governing body, the Institution transparent manner. decision-making, but must not unduly influence the business is expected to hold an annual stakeholder meeting in public, at which of the governing body. The governing body must review its representatives of the governing body, including the Principal, are effectiveness regularly and is expected to report publicly on the expected to give an account of the Institution’s performance and should results of effectiveness reviews and associated actions. In addition, be available to answer questions. This event may or may not also include the governing body must satisfy itself that it has discharged its regular governing body business. responsibilities through its annual review of the Institution’s 44. To function efficiently, the governing body must have rules for the overall performance which forms the core of the Annual Report. conduct of its meetings. Institutions are expected to publish these rules, which should include, but are not restricted to: • procedures for voting, rescinding decisions, calling extraordinary New members must 37. Governing bodies are expected to provide all those responsible for meetings, and declaring business reserved; receive a full induction making appointments or overseeing elections to the governing body with • requirements for a quorum; and on joining the governing a clear description of the responsibilities of and expectations placed upon • frequency of meetings. governing body members. This should also be published in a form that is body. Opportunities for accessible to potential electors of governing body members. 45. The agenda of governing body meetings and supporting papers are further development expected to be circulated sufficiently in advance to allow for effective for all members should 38. On taking up office, all new members are expected to receive the scrutiny of proposals, and decisions minuted. The agenda and minutes Institution’s standard letter of appointment, be briefed on the terms of be provided regularly, are expected to be published in a timely manner on the Institution’s their appointment and be made aware of the responsibilities placed on in accordance with their website. The governing body’s rules must specify the kinds of matter them for the proper governance of the Institution. Each new member individual needs that may not be published for reasons of confidentiality. The papers should have a programme of induction covering both general aspects considered at meetings should be made available to staff and students, and responsibilities. of the role and matters specific to the particular Institution, including its unless this would breach confidentiality or would not be in the interests current strategy and performance and its various stakeholder groups. of the Institution. 39. Special attention should be paid to induction for members who lack 46. Institutions are expected to make available on their website a list of experience of comparable roles. Governing bodies should work with all members of the governing body, along with a brief biography of student organisations to mitigate any challenges caused by the usually each member, and an email address for contacting the Secretary, which short tenure of student governing body members. As part of this, may also be used to contact members of the governing body. Details of particular care should be given to ensuring that their induction is the membership and terms of reference of key committees, including comprehensive and, as far as possible, completed before they take on the audit, remuneration and nominations committees (or equivalents) any governance responsibilities. should also be listed. 40. Induction should cover conflicts of interest, questioning skills, relevant financial knowledge and skills, and the nature of higher education institutions, except where the governing body member has sufficient relevant experience to render some part of this unnecessary. 41. Members’ individual contributions are expected to be reviewed regularly, at a minimum every two years, through a standardised process with the active involvement of the member concerned. Opportunities for relevant personal development should be identified. The timing of this review process should be carefully considered for student members 16 17 5 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Effectiveness in particular, in order to maximise its usefulness during their limited terms of office. These reviews need not all be carried out by the Chair, On joining the governing body, new members must receive an though the Chair retains ultimate responsibility for the effectiveness of induction aimed at equipping them to be effective governing the governing body (see Section 6). body members when they commence the role. Opportunities for further development for all members should be provided regularly, The proceedings of 42. Governing bodies are expected to meet at least four times a year. in accordance with their individual needs and responsibilities. the governing body must Members should attend all meetings where possible. Details of the The proceedings of the governing body must be conducted in number of meetings of the governing body and its main committees, be conducted in a timely a timely and appropriately transparent manner. Key officers and rates of attendance of members, should be reported publicly. and appropriately of the executive should attend meetings to support effective 43. In addition to normal meetings of the governing body, the Institution transparent manner. decision-making, but must not unduly influence the business is expected to hold an annual stakeholder meeting in public, at which of the governing body. The governing body must review its representatives of the governing body, including the Principal, are effectiveness regularly and is expected to report publicly on the expected to give an account of the Institution’s performance and should results of effectiveness reviews and associated actions. In addition, be available to answer questions. This event may or may not also include the governing body must satisfy itself that it has discharged its regular governing body business. responsibilities through its annual review of the Institution’s 44. To function efficiently, the governing body must have rules for the overall performance which forms the core of the Annual Report. conduct of its meetings. Institutions are expected to publish these rules, which should include, but are not restricted to: • procedures for voting, rescinding decisions, calling extraordinary New members must 37. Governing bodies are expected to provide all those responsible for meetings, and declaring business reserved; receive a full induction making appointments or overseeing elections to the governing body with • requirements for a quorum; and on joining the governing a clear description of the responsibilities of and expectations placed upon • frequency of meetings. governing body members. This should also be published in a form that is body. Opportunities for accessible to potential electors of governing body members. 45. The agenda of governing body meetings and supporting papers are further development expected to be circulated sufficiently in advance to allow for effective for all members should 38. On taking up office, all new members are expected to receive the scrutiny of proposals, and decisions minuted. The agenda and minutes Institution’s standard letter of appointment, be briefed on the terms of be provided regularly, are expected to be published in a timely manner on the Institution’s their appointment and be made aware of the responsibilities placed on in accordance with their website. The governing body’s rules must specify the kinds of matter them for the proper governance of the Institution. Each new member individual needs that may not be published for reasons of confidentiality. The papers should have a programme of induction covering both general aspects considered at meetings should be made available to staff and students, and responsibilities. of the role and matters specific to the particular Institution, including its unless this would breach confidentiality or would not be in the interests current strategy and performance and its various stakeholder groups. of the Institution. 39. Special attention should be paid to induction for members who lack 46. Institutions are expected to make available on their website a list of experience of comparable roles. Governing bodies should work with all members of the governing body, along with a brief biography of student organisations to mitigate any challenges caused by the usually each member, and an email address for contacting the Secretary, which short tenure of student governing body members. As part of this, may also be used to contact members of the governing body. Details of particular care should be given to ensuring that their induction is the membership and terms of reference of key committees, including comprehensive and, as far as possible, completed before they take on the audit, remuneration and nominations committees (or equivalents) any governance responsibilities. should also be listed. 40. Induction should cover conflicts of interest, questioning skills, relevant financial knowledge and skills, and the nature of higher education institutions, except where the governing body member has sufficient relevant experience to render some part of this unnecessary. 41. Members’ individual contributions are expected to be reviewed regularly, at a minimum every two years, through a standardised process with the active involvement of the member concerned. Opportunities for relevant personal development should be identified. The timing of this review process should be carefully considered for student members 16 17 6 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Key officers of the executive 47. Decisions of the governing body must be made only by its members, Key roles should attend meetings acting collectively. Executive officers should provide information and The Chair is responsible for the leadership of the governing body, to support effective advice when called upon (allowing that Secretaries may need to take and is ultimately responsible for its effectiveness. The Chair must a more active role in order to fulfil their responsibilities; see Section 6). decision-making, but must act so as to maintain the confidence of the governing body and At governing body meetings, the number of executive officers present not unduly influence the should not normally exceed the number of lay members present. Any ensure the Institution is well connected with its stakeholders, business of the governing member of the governing body must be able to raise issues relating including staff and students. body or its committees. to institutional management, notwithstanding the presence of The four Ancient universities must have a protocol to define the executive officers. To help ensure this, the Chair should be aware of any division of responsibilities between the Rector and the Chair. professional or personal connections between, or other relevant issues concerning, governing body members and executive officers. The Principal must be accountable to the governing body. The 48. The Chair must ensure that the distinct roles for executive officers and governing body must make clear, and regularly review, the members of the governing body are maintained and respected. The authority delegated to the Principal as chief executive, having Chair and the Principal should discuss and reach a clear understanding regard also to that conferred directly by the instruments of of the extent and nature of executive officers’ involvement in meetings, governance of the Institution. including which parts of the meeting each individual should attend. Ultimately the Chair is responsible for the conduct and effectiveness of The Secretary to the governing body must ensure compliance with governing body business. all procedures and ensure that the governing body is appropriately supported such that it is able to discharge its duties. All members must have access to the advice and services of the Secretary to The governing body must 49. The governing body is expected to review its own effectiveness each year and to undertake an externally facilitated evaluation of its own the governing body, and the appointment and removal of the review its effectiveness effectiveness and that of its committees, including size and composition Secretary must be a decision of the governing body as a whole. regularly and is expected to of membership, at least every five years. As part of these processes report publicly on the results or separately, the effectiveness of the academic board (also known of effectiveness reviews and The Chair is responsible 52. The Higher Education (Scotland) Act (2016) specifies the responsibilities as Senate, Senatus Academicus or academic council) is expected to be associated actions. for the leadership of the of what it terms the ‘Senior Lay Member’ in relation to the role of Chair. reviewed similarly. These reviews should be reported upon appropriately governing body, and is By virtue of older legislation, the Rector at the Ancient universities may within the Institution and outside. Externally facilitated reviews should carry out certain elements of the Chair role. References to the Chair be held following any period of exceptional change or upheaval ultimately responsible for in this Code therefore refer to the Senior Lay Member insofar as the (allowing suitable time to see the effects of changes made), the usual its effectiveness. The Chair relevant responsibilities fall within the legal definition of the Senior Lay timetable for externally facilitated review being brought forward if must act so as to maintain the Member role. necessary in these circumstances. confidence of the governing 53. Having responsibility for leadership of the governing body and as chair 50. Given the short terms of office served by student members, externally body and ensure the of its meetings, the Chair must promote its effective operation, ensuring facilitated effectiveness reviews should, where possible, take evidence Institution is well connected that its members work together effectively and have confidence in the from recent student members as well as those currently serving on the with its stakeholders, procedures laid down for the conduct of business. Like all other members, governing body. including staff and students. the Chair must contribute to collective decision-making and act only in the interests of the Institution, not on behalf of any electoral constituency or interest group. In addition, the governing 51. The governing body is expected to reflect annually on the performance body must satisfy itself of the Institution as a whole in relation to its strategic plan, with 54. The Chair may delegate duties to other members of the governing reference to agreed KPIs. Where possible, the governing body should body, but must do so with the consent of the governing body and with that it has discharged its benchmark institutional performance against equivalent metrics of other due regard to the Chair’s statutory responsibilities and the rules of the responsibilities through comparable institutions. The Institution’s annual performance against governing body. Any such delegation should be clearly recorded. its annual review of KPIs and its progress towards meeting its strategic objectives should be 55. As part of responsibility for the governing body’s overall effectiveness, the Institution’s overall published in its Annual Report. the Chair should ensure that student members are given the necessary performance which forms the support to participate effectively, bearing in mind their short terms core of the Annual Report. of office. 18 19 6 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) Key officers of the executive 47. Decisions of the governing body must be made only by its members, Key roles should attend meetings acting collectively. Executive officers should provide information and The Chair is responsible for the leadership of the governing body, to support effective advice when called upon (allowing that Secretaries may need to take and is ultimately responsible for its effectiveness. The Chair must a more active role in order to fulfil their responsibilities; see Section 6). decision-making, but must act so as to maintain the confidence of the governing body and At governing body meetings, the number of executive officers present not unduly influence the should not normally exceed the number of lay members present. Any ensure the Institution is well connected with its stakeholders, business of the governing member of the governing body must be able to raise issues relating including staff and students. body or its committees. to institutional management, notwithstanding the presence of The four Ancient universities must have a protocol to define the executive officers. To help ensure this, the Chair should be aware of any division of responsibilities between the Rector and the Chair. professional or personal connections between, or other relevant issues concerning, governing body members and executive officers. The Principal must be accountable to the governing body. The 48. The Chair must ensure that the distinct roles for executive officers and governing body must make clear, and regularly review, the members of the governing body are maintained and respected. The authority delegated to the Principal as chief executive, having Chair and the Principal should discuss and reach a clear understanding regard also to that conferred directly by the instruments of of the extent and nature of executive officers’ involvement in meetings, governance of the Institution. including which parts of the meeting each individual should attend. Ultimately the Chair is responsible for the conduct and effectiveness of The Secretary to the governing body must ensure compliance with governing body business. all procedures and ensure that the governing body is appropriately supported such that it is able to discharge its duties. All members must have access to the advice and services of the Secretary to The governing body must 49. The governing body is expected to review its own effectiveness each year and to undertake an externally facilitated evaluation of its own the governing body, and the appointment and removal of the review its effectiveness effectiveness and that of its committees, including size and composition Secretary must be a decision of the governing body as a whole. regularly and is expected to of membership, at least every five years. As part of these processes report publicly on the results or separately, the effectiveness of the academic board (also known of effectiveness reviews and The Chair is responsible 52. The Higher Education (Scotland) Act (2016) specifies the responsibilities as Senate, Senatus Academicus or academic council) is expected to be associated actions. for the leadership of the of what it terms the ‘Senior Lay Member’ in relation to the role of Chair. reviewed similarly. These reviews should be reported upon appropriately governing body, and is By virtue of older legislation, the Rector at the Ancient universities may within the Institution and outside. Externally facilitated reviews should carry out certain elements of the Chair role. References to the Chair be held following any period of exceptional change or upheaval ultimately responsible for in this Code therefore refer to the Senior Lay Member insofar as the (allowing suitable time to see the effects of changes made), the usual its effectiveness. The Chair relevant responsibilities fall within the legal definition of the Senior Lay timetable for externally facilitated review being brought forward if must act so as to maintain the Member role. necessary in these circumstances. confidence of the governing 53. Having responsibility for leadership of the governing body and as chair 50. Given the short terms of office served by student members, externally body and ensure the of its meetings, the Chair must promote its effective operation, ensuring facilitated effectiveness reviews should, where possible, take evidence Institution is well connected that its members work together effectively and have confidence in the from recent student members as well as those currently serving on the with its stakeholders, procedures laid down for the conduct of business. Like all other members, governing body. including staff and students. the Chair must contribute to collective decision-making and act only in the interests of the Institution, not on behalf of any electoral constituency or interest group. In addition, the governing 51. The governing body is expected to reflect annually on the performance body must satisfy itself of the Institution as a whole in relation to its strategic plan, with 54. The Chair may delegate duties to other members of the governing reference to agreed KPIs. Where possible, the governing body should body, but must do so with the consent of the governing body and with that it has discharged its benchmark institutional performance against equivalent metrics of other due regard to the Chair’s statutory responsibilities and the rules of the responsibilities through comparable institutions. The Institution’s annual performance against governing body. Any such delegation should be clearly recorded. its annual review of KPIs and its progress towards meeting its strategic objectives should be 55. As part of responsibility for the governing body’s overall effectiveness, the Institution’s overall published in its Annual Report. the Chair should ensure that student members are given the necessary performance which forms the support to participate effectively, bearing in mind their short terms core of the Annual Report. of office. 18 19 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) 56. Through leadership of the governing body, the Chair plays a key role in the business of the Institution, but not in day-to-day executive The Principal must be 61. The Principal is responsible for management of the Institution and for management. The Chair must strive to maintain a constructive and accountable to the governing providing the governing body with advice on its strategic direction. challenging working relationship with the Principal and, by extension, body. The governing 62. The Principal is the designated officer in respect of the use of Scottish between the governing body and the Principal. These relationships body must make clear, Funding Council funds and compliance with that Funding Council’s should be mutually supportive, but must also incorporate the checks and regularly review, the Financial Memorandum. The Principal must alert the governing body and balances imposed by the different roles that each has within an if any actions or policy under consideration would be incompatible authority delegated to the Institution’s constitution. with the terms of the Financial Memorandum. If the governing body Principal as chief executive, 57. The governing body may grant delegated authority to the Chair to act nevertheless decides to proceed, then the Principal has a duty to inform having regard also to that either the Chief Executive of the Scottish Funding Council, or other on its behalf between meetings. Alternatively, other arrangements may conferred directly by the appropriate officer. be made for action between meetings, such as the use of an Exceptions Committee or equivalent and/or protocols around decision-making by instruments of governance of 63. The Principal has responsibility for the appropriate implementation of the correspondence. Policy on this matter should be clearly defined in the the Institution. decisions of the governing body. rules governing the governing body’s business. The Chair is answerable to 64. The governing body is expected to ensure that the appointment process the governing body for and must make a report to the governing body for the Principal enables student, staff and trade union input to be taken on any action taken on its behalf. into account, taking into consideration the academic and non-academic 58. The governing body is expected to appoint one of its lay members to aspects of the Principal’s role. The membership of the selection committee serve as an intermediary for other members who might wish to raise for the appointment of the Principal must be approved by the governing concerns about the conduct of the governing body or the Chair. Led by body and is expected to consist of lay members, at least one Elected or this lay member, the members of the governing body are expected to Union staff member, at least one student member of the governing body appraise the Chair’s performance at least annually, without the Chair and adequate representation from the academic community. present. Prior to this, all governing body members should be offered the 65. Assessment of the performance of the Principal, normally led by the opportunity to provide relevant feedback individually and in private. Chair, is expected to take place on an annual basis, with views sought Like other members, the Chair should be assisted to identify professional and considered from each member of the governing body. development needs in relation to governance responsibilities and seek opportunities to address them. 59. In formulating rules and procedures for the election of a Senior Lay The Secretary to the 66. The Secretary to the governing body must be appointed to that post Member, as required by the Higher Education Governance (Scotland) Act by the governing body and, in carrying out the role of Secretary to the governing body must 2016, the Institution is expected to consult with relevant stakeholders. The governing body, must be solely responsible to the governing body. When ensure compliance with Institution is expected to publish these rules and procedures on its website, dealing with governing body business, the Secretary must act on the along with the membership of the committee managing this process. all procedures and ensure instructions of the governing body itself. Only the governing body, as a that the governing body is whole, is empowered to remove the Secretary from these duties. appropriately supported such The four Ancient universities 60. A distinction needs to be drawn in the four Ancient universities (the 67. The Secretary must have a direct reporting link to the Chair of the that it is able to discharge must have a protocol to Universities of Aberdeen, Edinburgh, Glasgow and St. Andrews) governing body for the conduct of governing body business (i.e. agendas, its duties. All members must papers, minutes, etc.) and must be available and accessible to all members define the division of between the role of the Chair and the specific role of the Rector in ‘presiding’ at governing body (Court) meetings. The exact interpretation have access to the advice and of the governing body. All members of the governing body should be responsibilities between the services of the Secretary to of the Rector’s role with respect to the governing body is a matter proactive in seeking advice from the Secretary when it is required. Rector and the Chair. for agreement by the governing body of the individual Institution the governing body, and the 68. The Secretary must draw to the attention of the governing body concerned. Each governing body must set that agreement out clearly in appointment and removal any conflict of interest, actual or potential, between the Secretary’s a protocol, the content of which should be published and made clear to of the Secretary must be a administrative or managerial responsibilities within the Institution and candidates for the posts of Rector and Senior Lay Member and reflected responsibilities as a Secretary to the governing body. If the governing decision of the governing in the job descriptions for these posts.7 body believes that it has identified such a conflict of interest itself, the body as a whole. Chair should seek advice from the Principal, but must offer the Secretary an opportunity to respond. 7 Note that this section does not apply to the Rector at the University of Dundee or the University of the Highlands 69. The Secretary is expected to ensure that papers are supplied to members and Islands (UHI). At the University of Dundee, the Rector is elected by the student body and may choose to act as an ex officio member of the governing body or appoint an assessor following consultation with the students’ in a timely manner and contain such information, in such form and of association; neither the Rector nor their assessor automatically presides at meetings of the governing body. UHI’s such quality, as is appropriate to enable the governing body to discharge Rector also has ex officio ordinary membership of the governing body. This is a quite distinct position from that its duties efficiently and effectively. of Rector at the Ancient universities: UHI’s Rector is elected by and chairs the UHI Foundation. 20 21 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) 56. Through leadership of the governing body, the Chair plays a key role in the business of the Institution, but not in day-to-day executive The Principal must be 61. The Principal is responsible for management of the Institution and for management. The Chair must strive to maintain a constructive and accountable to the governing providing the governing body with advice on its strategic direction. challenging working relationship with the Principal and, by extension, body. The governing 62. The Principal is the designated officer in respect of the use of Scottish between the governing body and the Principal. These relationships body must make clear, Funding Council funds and compliance with that Funding Council’s should be mutually supportive, but must also incorporate the checks and regularly review, the Financial Memorandum. The Principal must alert the governing body and balances imposed by the different roles that each has within an if any actions or policy under consideration would be incompatible authority delegated to the Institution’s constitution. with the terms of the Financial Memorandum. If the governing body Principal as chief executive, 57. The governing body may grant delegated authority to the Chair to act nevertheless decides to proceed, then the Principal has a duty to inform having regard also to that either the Chief Executive of the Scottish Funding Council, or other on its behalf between meetings. Alternatively, other arrangements may conferred directly by the appropriate officer. be made for action between meetings, such as the use of an Exceptions Committee or equivalent and/or protocols around decision-making by instruments of governance of 63. The Principal has responsibility for the appropriate implementation of the correspondence. Policy on this matter should be clearly defined in the the Institution. decisions of the governing body. rules governing the governing body’s business. The Chair is answerable to 64. The governing body is expected to ensure that the appointment process the governing body for and must make a report to the governing body for the Principal enables student, staff and trade union input to be taken on any action taken on its behalf. into account, taking into consideration the academic and non-academic 58. The governing body is expected to appoint one of its lay members to aspects of the Principal’s role. The membership of the selection committee serve as an intermediary for other members who might wish to raise for the appointment of the Principal must be approved by the governing concerns about the conduct of the governing body or the Chair. Led by body and is expected to consist of lay members, at least one Elected or this lay member, the members of the governing body are expected to Union staff member, at least one student member of the governing body appraise the Chair’s performance at least annually, without the Chair and adequate representation from the academic community. present. Prior to this, all governing body members should be offered the 65. Assessment of the performance of the Principal, normally led by the opportunity to provide relevant feedback individually and in private. Chair, is expected to take place on an annual basis, with views sought Like other members, the Chair should be assisted to identify professional and considered from each member of the governing body. development needs in relation to governance responsibilities and seek opportunities to address them. 59. In formulating rules and procedures for the election of a Senior Lay The Secretary to the 66. The Secretary to the governing body must be appointed to that post Member, as required by the Higher Education Governance (Scotland) Act by the governing body and, in carrying out the role of Secretary to the governing body must 2016, the Institution is expected to consult with relevant stakeholders. The governing body, must be solely responsible to the governing body. When ensure compliance with Institution is expected to publish these rules and procedures on its website, dealing with governing body business, the Secretary must act on the along with the membership of the committee managing this process. all procedures and ensure instructions of the governing body itself. Only the governing body, as a that the governing body is whole, is empowered to remove the Secretary from these duties. appropriately supported such The four Ancient universities 60. A distinction needs to be drawn in the four Ancient universities (the 67. The Secretary must have a direct reporting link to the Chair of the that it is able to discharge must have a protocol to Universities of Aberdeen, Edinburgh, Glasgow and St. Andrews) governing body for the conduct of governing body business (i.e. agendas, its duties. All members must papers, minutes, etc.) and must be available and accessible to all members define the division of between the role of the Chair and the specific role of the Rector in ‘presiding’ at governing body (Court) meetings. The exact interpretation have access to the advice and of the governing body. All members of the governing body should be responsibilities between the services of the Secretary to of the Rector’s role with respect to the governing body is a matter proactive in seeking advice from the Secretary when it is required. Rector and the Chair. for agreement by the governing body of the individual Institution the governing body, and the 68. The Secretary must draw to the attention of the governing body concerned. Each governing body must set that agreement out clearly in appointment and removal any conflict of interest, actual or potential, between the Secretary’s a protocol, the content of which should be published and made clear to of the Secretary must be a administrative or managerial responsibilities within the Institution and candidates for the posts of Rector and Senior Lay Member and reflected responsibilities as a Secretary to the governing body. If the governing decision of the governing in the job descriptions for these posts.7 body believes that it has identified such a conflict of interest itself, the body as a whole. Chair should seek advice from the Principal, but must offer the Secretary an opportunity to respond. 7 Note that this section does not apply to the Rector at the University of Dundee or the University of the Highlands 69. The Secretary is expected to ensure that papers are supplied to members and Islands (UHI). At the University of Dundee, the Rector is elected by the student body and may choose to act as an ex officio member of the governing body or appoint an assessor following consultation with the students’ in a timely manner and contain such information, in such form and of association; neither the Rector nor their assessor automatically presides at meetings of the governing body. UHI’s such quality, as is appropriate to enable the governing body to discharge Rector also has ex officio ordinary membership of the governing body. This is a quite distinct position from that its duties efficiently and effectively. of Rector at the Ancient universities: UHI’s Rector is elected by and chairs the UHI Foundation. 20 21 7 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) 70. The Secretary should be solely responsible for commissioning legal advice Committees and Academic Board for the governing body, and advising it on all matters of procedure. The At a minimum, the governing body’s committees must include a Chair and members of the governing body should look to the Secretary nominations committee, an audit committee, and a remuneration for guidance about their responsibilities under the charter, statutes, committee, or equivalents. All committees must be provided with articles, ordinances and regulations to which they are subject, including legislation, this Code and the requirements of the Scottish Funding a clear remit and written terms of reference. Council, and on how these responsibilities should be discharged. It is The governing body must establish a nominations committee the responsibility of the Secretary to alert the governing body if the with a suitably inclusive membership to oversee the appointment Secretary believes that any proposed action would exceed the governing of new members to the governing body. body’s powers or be contrary to legislation, this Code or to the Scottish Funding Council’s Financial Memorandum (notwithstanding the Principal’s A suitably qualified audit committee must be appointed. responsibility as accountable officer in the latter case). The governing body must establish a remuneration committee 71. The Secretary is expected to advise the Chair in respect of any matters to determine and review the salaries, benefits and terms and where conflict, potential or real, may occur between the governing body and the Principal. The Secretary should also keep the Principal fully conditions (and, where appropriate, severance payments) of informed on any matter relating to governing body business (other than the Principal and such other members of staff as the governing in relation to the Principal’s own performance and reward). body deems appropriate. The policies and processes used by the 72. The governing body must safeguard the Secretary’s ability to carry out remuneration committee must be determined by the governing these responsibilities. body, and the committee’s reports to the governing body should provide sufficient detail to enable the governing body to satisfy itself that the decisions made have been compliant with its policies. The governing body has responsibility for the effectiveness of the Institution’s academic board. At a minimum, the governing 73. Committee remits and terms of reference must state the extent body’s committees must and limits of the committee’s responsibilities and authority and are expected to be published on the Institution’s website. Committees must include an audit committee, a not exceed their terms of reference and should be so advised by the remuneration committee and Secretary to the governing body. Committees must distinguish between nominations committee, or issues on which they are empowered to take decisions, and issues that equivalents. All committees they must refer to the governing body for decision. Where a committee must be provided with a clear is acting under delegated powers it should submit regular written remit and written terms reports to the governing body on decisions that it has taken on the of reference. governing body’s behalf. The governing body must 74. The membership of the nominations committee should have a lay establish a nominations member majority. The membership should include the Chair, the Principal, at least one Elected or Union staff member and a student member of the committee with a suitably governing body. Where the Chair is chair of the nominations committee, inclusive membership to this role should be delegated to another member when the committee is oversee the appointment managing the appointment of the Chair’s successor. of new members to the 75. The nominations committee is expected to consider the field of candidates governing body. against a skills register which to and also to consider whether candidates share the values of the Institution and will add to the overall success and health of the Institution. The nominations committee must also give due consideration to issues of equality and diversity, in line with Section 3 of this Code, and to the appropriate inclusion in the governing body of relevant stakeholder groups. 22 23 7 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) 70. The Secretary should be solely responsible for commissioning legal advice Committees and Academic Board for the governing body, and advising it on all matters of procedure. The At a minimum, the governing body’s committees must include a Chair and members of the governing body should look to the Secretary nominations committee, an audit committee, and a remuneration for guidance about their responsibilities under the charter, statutes, committee, or equivalents. All committees must be provided with articles, ordinances and regulations to which they are subject, including legislation, this Code and the requirements of the Scottish Funding a clear remit and written terms of reference. Council, and on how these responsibilities should be discharged. It is The governing body must establish a nominations committee the responsibility of the Secretary to alert the governing body if the with a suitably inclusive membership to oversee the appointment Secretary believes that any proposed action would exceed the governing of new members to the governing body. body’s powers or be contrary to legislation, this Code or to the Scottish Funding Council’s Financial Memorandum (notwithstanding the Principal’s A suitably qualified audit committee must be appointed. responsibility as accountable officer in the latter case). The governing body must establish a remuneration committee 71. The Secretary is expected to advise the Chair in respect of any matters to determine and review the salaries, benefits and terms and where conflict, potential or real, may occur between the governing body and the Principal. The Secretary should also keep the Principal fully conditions (and, where appropriate, severance payments) of informed on any matter relating to governing body business (other than the Principal and such other members of staff as the governing in relation to the Principal’s own performance and reward). body deems appropriate. The policies and processes used by the 72. The governing body must safeguard the Secretary’s ability to carry out remuneration committee must be determined by the governing these responsibilities. body, and the committee’s reports to the governing body should provide sufficient detail to enable the governing body to satisfy itself that the decisions made have been compliant with its policies. The governing body has responsibility for the effectiveness of the Institution’s academic board. At a minimum, the governing 73. Committee remits and terms of reference must state the extent body’s committees must and limits of the committee’s responsibilities and authority and are expected to be published on the Institution’s website. Committees must include an audit committee, a not exceed their terms of reference and should be so advised by the remuneration committee and Secretary to the governing body. Committees must distinguish between nominations committee, or issues on which they are empowered to take decisions, and issues that equivalents. All committees they must refer to the governing body for decision. Where a committee must be provided with a clear is acting under delegated powers it should submit regular written remit and written terms reports to the governing body on decisions that it has taken on the of reference. governing body’s behalf. The governing body must 74. The membership of the nominations committee should have a lay establish a nominations member majority. The membership should include the Chair, the Principal, at least one Elected or Union staff member and a student member of the committee with a suitably governing body. Where the Chair is chair of the nominations committee, inclusive membership to this role should be delegated to another member when the committee is oversee the appointment managing the appointment of the Chair’s successor. of new members to the 75. The nominations committee is expected to consider the field of candidates governing body. against a skills register which to and also to consider whether candidates share the values of the Institution and will add to the overall success and health of the Institution. The nominations committee must also give due consideration to issues of equality and diversity, in line with Section 3 of this Code, and to the appropriate inclusion in the governing body of relevant stakeholder groups. 22 23 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) of pay used throughout the Institution; and assessments of relevant A suitably qualified 76. The governing body must appoint an audit committee and set up internal individuals’ performance. The remuneration committee should oversee audit committee must and external audit arrangements in accordance with the appropriate contracts of employment for senior staff and should ensure that these be appointed. Audit Code and the Scottish Funding Council’s requirements. The audit do not specify periods of notice of more than 12 months and do not committee should be a small, authoritative body which has the necessary require the payment of pension enhancements (except where these financial expertise and the time to examine the Institution’s financial follow from pension scheme rules). The remuneration committee and risk management control and governance under delegation from is expected similarly to act proportionately and with regard to the the governing body. The committee is expected to produce an annual appropriate use of funds when considering severance arrangements for report for the governing body, including its opinion on the adequacy senior staff. and effectiveness of governance arrangements (not confined to financial arrangements), financial control and arrangements for promoting economy, efficiency and effectiveness. The governing body 82. The governing body must ensure that the academic board (also known has responsibility for as Senate, Senatus Academicus or academic council) is appropriately 77. The governing body should also receive reports on the Institution’s risk the effectiveness of the constituted according to relevant legislation and the Institution’s management arrangements. These may be the responsibility of the Audit statutory instruments. The governing body is expected to receive and Committee or of a separate Risk Committee (or equivalent). Institution’s academic board. consider reviews of the academic board’s effectiveness (see Section 5). 83. The Institution is expected to have appropriate measures in place to The governing body must 78. Membership of the remuneration committee should have a majority of clarify the different responsibilities of the governing body and the establish a remuneration lay members. A majority of these lay members should be members of academic board and to encourage a high level of mutual understanding committee to determine and the governing body (others may be external lay committee members). between them. The membership should include the Chair of the governing body. The review the salaries, benefits committee chair should be a lay member of the governing body and and terms and conditions should not be the Chair of the governing body. The Principal should be (and, where appropriate, consulted on remuneration relating to other senior post-holders and severance payments) of the should attend meetings of the committee, except when the committee Principal and such other discusses matters relating to the Principal’s own remuneration. members of staff as the 79. The policies and processes used by the remuneration committee in governing body deems reaching decisions on individuals must be discussed by the whole appropriate. The policies governing body and approved by that body. The remuneration and processes used by the committee’s reports to the governing body should provide sufficient detail of the broad criteria and policies against which decisions, including remuneration committee in relation to any unusual severance payments, have been made. must be determined by the governing body, and the 80. In addition, the remuneration committee is expected to seek the views of representatives of students and staff of the Institution, committee’s reports to the including representatives of recognised trade unions, in relation to governing body should the remuneration package of the Principal and the senior executive provide sufficient detail to team. This requirement may be implemented in part through relevant enable the governing body to members of the governing body serving as members of the remuneration satisfy itself that the decisions committee or attending its meetings, or may be achieved through made have been compliant separate consultation with representatives of the student and staff communities. The relevant process should form part of the policies and with its policies. processes approved by the whole governing body, as outlined above. 81. The remuneration committee is expected to represent the public interest and avoid any inappropriate use of public funds. The remuneration committee is expected to seek and make use of sufficient relevant information to reach well informed evidence-based decisions. This should include appropriate comparative information on salaries and other benefits and conditions of service in equivalent positions in the Higher Education sector and elsewhere, including other organisations that similarly receive public funding; national pay awards and rates 24 25 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) of pay used throughout the Institution; and assessments of relevant A suitably qualified 76. The governing body must appoint an audit committee and set up internal individuals’ performance. The remuneration committee should oversee audit committee must and external audit arrangements in accordance with the appropriate contracts of employment for senior staff and should ensure that these be appointed. Audit Code and the Scottish Funding Council’s requirements. The audit do not specify periods of notice of more than 12 months and do not committee should be a small, authoritative body which has the necessary require the payment of pension enhancements (except where these financial expertise and the time to examine the Institution’s financial follow from pension scheme rules). The remuneration committee and risk management control and governance under delegation from is expected similarly to act proportionately and with regard to the the governing body. The committee is expected to produce an annual appropriate use of funds when considering severance arrangements for report for the governing body, including its opinion on the adequacy senior staff. and effectiveness of governance arrangements (not confined to financial arrangements), financial control and arrangements for promoting economy, efficiency and effectiveness. The governing body 82. The governing body must ensure that the academic board (also known has responsibility for as Senate, Senatus Academicus or academic council) is appropriately 77. The governing body should also receive reports on the Institution’s risk the effectiveness of the constituted according to relevant legislation and the Institution’s management arrangements. These may be the responsibility of the Audit statutory instruments. The governing body is expected to receive and Committee or of a separate Risk Committee (or equivalent). Institution’s academic board. consider reviews of the academic board’s effectiveness (see Section 5). 83. The Institution is expected to have appropriate measures in place to The governing body must 78. Membership of the remuneration committee should have a majority of clarify the different responsibilities of the governing body and the establish a remuneration lay members. A majority of these lay members should be members of academic board and to encourage a high level of mutual understanding committee to determine and the governing body (others may be external lay committee members). between them. The membership should include the Chair of the governing body. The review the salaries, benefits committee chair should be a lay member of the governing body and and terms and conditions should not be the Chair of the governing body. The Principal should be (and, where appropriate, consulted on remuneration relating to other senior post-holders and severance payments) of the should attend meetings of the committee, except when the committee Principal and such other discusses matters relating to the Principal’s own remuneration. members of staff as the 79. The policies and processes used by the remuneration committee in governing body deems reaching decisions on individuals must be discussed by the whole appropriate. The policies governing body and approved by that body. The remuneration and processes used by the committee’s reports to the governing body should provide sufficient detail of the broad criteria and policies against which decisions, including remuneration committee in relation to any unusual severance payments, have been made. must be determined by the governing body, and the 80. In addition, the remuneration committee is expected to seek the views of representatives of students and staff of the Institution, committee’s reports to the including representatives of recognised trade unions, in relation to governing body should the remuneration package of the Principal and the senior executive provide sufficient detail to team. This requirement may be implemented in part through relevant enable the governing body to members of the governing body serving as members of the remuneration satisfy itself that the decisions committee or attending its meetings, or may be achieved through made have been compliant separate consultation with representatives of the student and staff communities. The relevant process should form part of the policies and with its policies. processes approved by the whole governing body, as outlined above. 81. The remuneration committee is expected to represent the public interest and avoid any inappropriate use of public funds. The remuneration committee is expected to seek and make use of sufficient relevant information to reach well informed evidence-based decisions. This should include appropriate comparative information on salaries and other benefits and conditions of service in equivalent positions in the Higher Education sector and elsewhere, including other organisations that similarly receive public funding; national pay awards and rates 24 25 1 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) 26 1 Scottish Code of Good Higher Education Governance (2017 edition) Scottish Code of Good Higher Education Governance (2017 edition) 26 Published October 2017 Committee of the Chairs of Scottish Higher Education Institutions www.scottishuniversitygovernance.ac.uk