Governance failures in South African public higher education institutions - lessons to be learnt from company law

It is recommended that the Higher Education Act be amended to provide a standard of conduct for council members and executive management to ensure clarity and accountability. The Higher Education Act will benefit from adding provisions applicable to members of council and management structures of public universities similar to those in the Companies Act, which provide for the duties and liabilities of directors, their fiduciary duties and the duty of care and skill, their declaration as delinquent, as well as their removal. Incorporating these provisions, with the necessary amendments as may be required, will enhance accountability at the management level and curb mismanagement of public universities' financial and other resources. It is also advisable that each institution assess the knowledge and experience of its council members annually, or in the event of a vacancy, and setting minimum requirements for members to ensure that the council has the required knowledge and experience. Private higher education institutions have the same focus and objectives as public higher education institutions. They are mainly governed by the Companies Act, and their directors and management are treated like the directors and management of any other company. This means that private higher education institutions are subject to the Companies Act while public higher educations are not, so different standards are used to assess their governance. Private higher education institutions are measured against common law and the statutory provisions of the Companies Act. In contrast, public higher education institutions are measured against the common law and the Higher Education Act of 1997. It is not recommended that public higher education institutions be corporatised; instead, the Higher Education Act will benefit from including similar provisions to those contained in the Companies Act relating to directors, which will ensure high levels of transparency, accountability, and good corporate governance. In addition, the Guideline for Good Governance Practice and Governance Indicators for Councils of South African Public Education Institutions should also include the management of a public university and contain enforcement mechanisms. Lastly, the regulations for reporting by public higher education institutions should also be updated to align with King IV and include enforcement mechanisms to ensure effective compliance. © 2023 Juta and Company Ltd. All rights reserved.