8 Feb, 2012

Why Universities Should “Beware the Seductive Attractions of Money Power”

Ramesh Thakur

Reporting on the management changes at Research in Motion, Tim Weber, business editor, BBC, wrote that the co-chief executive officers’ departure was ‘long overdue.’ The once-dominant company had ‘thrown it all away… in an orgy of poor executive decisions, lacklustre innovation, unkept promises in delivering new product and — the greatest sin of all — a total lack of understanding that its part of the tech industry was undergoing a fundamental shift.’

The governance deficits were foreshadowed in the threeway relationship between the Centre for International Governance Innovation, the Balsillie School of International Affairs, and Wilfrid Laurier and Waterloo universities. Yet no business reporter connected the dots or followed the money trail, despite the substantial amounts of public funds involved. As a result, there remains a story to be told. And the lessons have relevance for India, as it opens up its education sector to international influences.

Business practices and culture can be radically different from those in the public sector and universities. They reflect different historical roots and legacies, different modes of doing core business and different norms of accountability. Civility-challenged business executives can treat employees as ‘hired underlings;’ university management respects even junior faculty as colleagues. The corporate culture can stifle contrarian opinions and weed out nonconformists; universities encourage and thrive on critical questioning. Executives can hire, promote and fire almost at whim or, rarely, in exchange for sexual favours; public servants are better protected by complex layers of rules and appeal procedures.

Ideas matter and universities are the marketplace of ideas. Think tanks are the conduit for processing ideas into policy recommendations. A society in intellectual ferment, with the clash of ideas given free play, is fertile ground for progress and advancement. A society that is bereft of and represses new ideas is doomed to stagnation.

 Research institutions are dedicated to the spirit of free and critical inquiry, tolerance of diversity and a commitment to resolution of difference of opinion through dialogue and debate. They provide the terrain on which intellectually arid and stagnant societies encounter new worlds of ideas. The process of transformation of large and complex societies creates social ferment, disorder, dislocation, volatility and sometimes even conflict. Universities and think tanks, whose core business is knowledge management and its processing into policy advice, often find themselves embattled because they are at the forefront of this struggle for social transformation.

Many universities across the world are becoming more agile and market-responsive due to changes in the higher education sector. This has forced too many to accept donations without due diligence and, sometimes, even bend to donor directives. The intense embarrassment felt by the London School of Economics because of its links to the Gaddafi regime is a salutary caution against the seductive attractions of money power trumping long-held and cherished academic values and practices that prioritize intellectual freedom and institutional autonomy. The LSE’s deeply damaged institutional integrity will take time to repair. The experience shows exactly why we need firm governance structures and arrangements that set up robust firewalls between academic matters and institutional autonomy against outside influence.

Who would have thought that a world famous British university would demonstrate a softer commitment to core academic values? If such a prestigious university can fall short of expected standards, so can reputable Canadian universities.

But that is only part of the problem. As the mode of corporate leadership came to be widely admired and emulated in the worlds of the public sector and universities, the vices of casino capitalism cross-infected sectors that previously were pillars of public service ethos.

The reification of the corporate sector with its all-encompassing motto of ‘greed is good’ produced the biggest global financial and economic crisis since the Great Depression of the 1930s. The corporate environment increasingly became an ethics-free zone. The tragedy is that, as the dominant management ideology has forced the corporate management culture more and more into public sector and university administrations, the risk has grown of an accompanying infestation of ethically-challenged public sector chief executives. And also university presidents, especially when fund raising becomes a chief criterion for selecting them.

A self-respecting university should have a bottom line beyond just the bottom line. It is time to bring back civic virtue into the marketplace and spread civility in the boardroom. To restore public trust in financial institutions and the corporate sector, perhaps the best and the brightest from the public sector should be poached and perched in positions of corporate power to instruct them on what a moral compass means in practice.

Public-private partnerships should see private money flow into public institutions where benefactors donate to educational institutions, retain an interest in what is done with their money, but have no control over its use. If managerial and operational control is under the tight control of a donor and corporate buddies, instead of private money being put to serve the public good, in effect the taxpayer ends up subsidizing the whims and indulgences of a megarich donor. And if universities should succumb to donor pressure on academic matters, they will vindicate the contempt of wealthy ‘benefactors’ for academics and their values.

Ramesh Thakur is director, Centre for Nuclear Non-proliferation and Disarmament ANU Asia-Pacific College of Diplomacy, Canberra. Till-early last year he was director, Balsillie School of International Affairs, Waterloo, a school established by Research in Motion co-founder Jim Balsillie.