Research on the model of university autonomy in the direction of corporate governance

Trinh Thuy Anh et al. HCMCOUJS-Economics and Business Administration, 11(2), 31-41

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Research on the model of university autonomy in the direction of

corporate governance

Trinh Thuy Anh^1*, Bui Quang Hung², Nguyen Pham Kien Minh¹

¹Ho Chi Minh City Open University, Vietnam

²University of Economics Ho Chi Minh City, Vietnam

^*Corresponding author: [email protected]

ARTICLE INFO

ABSTRACT

DOI:10.46223/HCMCOUJS.

econ.en.11.2.1950.2021

Recently, the trend of university autonomy is seen as a

solution to promote the development of universities, improve the

quality of education and contribute to the training of high–quality

human resources for the country. So how should university

autonomy be recognized, evaluated, and development-oriented? Is

university autonomy aimed at promoting corporate governance

towards corporate governance as a solution to today’s problems?

This article aims to assess the current state of university

governance in Vietnam and the world. Studies related to the

university governance model, which is in the direction of corporate

governance – are also analyzed and discussed. This article

proposes a model to help standardize modern governance activities

according to corporate governance, limit unnecessary overlap

between unrelated departments in university activities, thereby

promoting the development of universities in the future.

Received: March 17^th, 2021

Revised: March 17^th, 2021

Accepted: April 04^th, 2021

Keywords:

business-oriented university

model; entrepreneurial

university; university

autonomy; university

governance

1. Introduction

The dramatic changes of the modern world, especially in the robotic as well as the

explosion of the Internet of everything and 4.0 technologies, have increased the needs of highly

qualified employees in all majors. However, the current training rate of universities has not been

able to fulfill the demands on a well-trained workforce of society. This issue can be explained by

the gaps between of the educational institutions’ training and the employers’ requirements.

Although the continuously modifying and modernizing, the higher education policies over 20

years has brought a lot of advantages for governing university in Vietnam; for example, more

freedom in the sovereignty, this country’s education system still confront many barriers such as

the centralized operations and inappropriate financial policies (Do, 2018; H. D. Nguyen, 2013; P.

T. L. Pham, 2015). Thus, based on the current needs of society and the global trends of

university governance, Vietnam universities should be given more rights on their autonomy at

multiple levels, not only in managerial but also on searching financial supports for transforming

from academic institutions to corporate universities, which will be operated based on the market

mechanism. This study will research and propose a method to innovate the current Vietnamese

institution governance policy based on corporate administration to catch up with the worldwide

school governing’s trend and, therefore, fulfill the needs of the workforce market in particular.

2. Autonomy in University Governance and Corporate University Model

2.1. Autonomy in University Governance

The autonomy in university governance can be divided into four categories: management,

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finance, human resources, and academic, where the sovereignty level will have relied on the

government policies and the current status of the social needs (Chiang, 2004; Parakhina, Godina,

Boris, & Ushvitsky, 2017; Rayevnyeva & Stryzhychenko, 2017). The study of Song (2020) on

46 different countries has shown solid and negative impacts between the government’s financial

supports and the marketization of training institutions, while there is no relationship between the

prior factor towards the academic capitalist knowledge. Meanwhile, he found the government

subsidies will positively affect public-related benefits. In contrast, the market mechanism will

help to enhance the training academies benefits or the academic capitalist knowledge regime

through the collaborations between the university and industries. After all, both of them

contribute to the steady improvements of the higher education quality. This result has

strengthened the work of Wise and Carrazco (2018), who found that the increase in self-

government level in academies will allow them to contribute to the local communities’ benefits.

Also, the relationship between the local academies and industry sectors is believed to bring

stable financial supports for the activities that enhance the institutions’ education quality in the

long term. In other words, gaining universities more rights in self-functioning and operating

them as corporations is necessary since this will both help to deliver more benefits to the local

societies as well as let the institutions work more efficiently and effectively (Flórez-Parra,

López-Pérez, & López-Hernández, 2019).

Although many policies have been proposed by the Vietnam Ministry of Education in the

higher education sector for suiting the country’s developments, universities in this country still

dealing with a lot of barriers in self-governing acts and not until the 2012 Education Law, the

autonomy in Vietnamese training institutions has reached its peak and is governed by the

schools’ representatives which is “School Council” (Do, 2018; P. T. L. Pham, 2016; Trinh,

2017). However, the foundation of “School Council” in the Vietnamese Education System has

not been concerned right at its level, bringing with it a high complexity, overlap, and formalism

in managerial activities and not contribute much to the university developments’ guidance as

well as the education system in general (H. T. T. Pham, Nguyen, Vu, & Hoang, 2019; Trinh,

2017). In addition to this, the financial source for innovations in higher education sectors mainly

comes from the student’s tuition fees. Still, the differences in tuition fee policies between the

private institution and public schools have caused significant gaps and barriers for applying

innovative ideas to the operations of the public academy (L. T. Nguyen & Nguyen, 2019; T. Q.

Nguyen, 2017; P. T. L. Pham, 2016). This proves that the majority of universities in Vietnam

have not reached the self-governing state or slowly switching to this state in both management

and funding supports for various reasons (T T. H. Pham, 2016; Trinh, 2017; Vu, 2017).

2.2. Scholars’ role in Governing University

In the corporations, medium and large enterprises, and private universities that are

operated under the advice of specialized sectors, two of the most important apparatuses are:

market research faculty and product/service development faculty, which are usually led by

experts with high contributions and experiences in research (D’Agostino, Laursen, &

Santangelo, 2013; Kang & Park, 2012; Lim, 2015). However, there are very few schools in

Vietnam public university system forming this type of faculty. Usually, the institutions’ future

direction will be mainly decided by the school councils, rectors, or school administrators under

the policies provided by the local People’s Committee, the country’s Ministries, or a group of

specific corporations who are invited to evaluate the teachings’ curriculums as well as the

schools’ future development paths (H. T. T. Pham et al., 2019).

The work of T. Q. Nguyen, Le, Nguyen, and Vu (2019), concluded the effective rate

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when lecturers help governing universities in both management and finance control will increase

from local institutions, national schools, self-governing education academies, and private

institutions in order. Even though they (the lecturers) will generally be the ones who carry out

the works related to teaching and research more than experts, experts are individuals who will

implement policies, techniques, and aspects of the techniques better than these instructors.

Therefore, when it comes to validating the feasibility of a policy, regulation, or development

orientation, lecturers and the scientific communities usually have a broader view than experts.

From that, they can adjust as well as propose better policies while experts have more advantages

in implementing those recommendations.

In the management perspective, P. T. L. Pham (2016) states that many correlations in the

works’ common characteristics require expertise such as health, law, and education and often

handled by scientists and experts groups. As a result, when these groups get involved with the

university development-oriented governance, they can help to provide specific and unique

policies for educational administration. However, some points make them unsuitable for

governing schools, namely “academic loyalty conflicts with assigned responsibilities,” opposing

with “organizational expectations,” and the freely pursue academic ideas desire (P. T. L. Pham,

2016). Because the scientific community is the knowledge pursuer not only at the domestic level

but also at the international level, the acceptance of new philosophies, policies, and proposals of

existing research in the scientific field in this group will be better than professionals who are

trained to become managers. Therefore, when these scholars evaluate the schools’ development-

oriented policies, they will provide better views that are more suitable to the social and global

needs than experts who only work with aspects related to the future developments of the

institutions (T. H. Pham, 2016). In fact, the main task of scientific councils in universities is

giving evaluations and approvals to the feasibility of projects and academic research as well as

providing funding for implementing those proposed works instead of constructing improvements

for the school (M. D. Nguyen, 2018). Also, the academic research and sharing seminars on

higher education training methods in many Vietnamese academies keep being significantly

formalism. They do not have many practical effects on how the schools should change in the

future. Moreover, instead of solving the current needs of society as well as contributing to the

developments and innovations in the academic environment, many Vietnamese academic studies

focus on extending the existing works, which seem to be unrealistic (M. D. Nguyen, 2018; P. T.

L. Pham, 2015). Therefore, the establishment of a scientific community group that participates in

the management and enhancing the university’s operations is necessary, not only for the purpose

of reducing the workload of specialized administrators in the school but also help draw the paths

for later improvements of it. As a result, the institutions’ outcomes will be the qualified applied

scientific research, which creates stable funding sources for the universities’ improvements

through technology transferring or practical applications. Meanwhile, this scientific community

can boost the quality of academic personnel through the assessment, analysis, and support of

faculty members in multidisciplinary or interdisciplinary scientific research, as well as proposing

specific curriculums for enhancing the professional capability of lecturers in specific sectors.

Currently, most studies view lecturers as scholars in the academic governance field.

Despite the fact that they are the ones who deal with the inadequacies in the school’s

administrative activities most, these educators do not spend much attention in participating in

non-professional activities, especially in constructing the development of their academies and

reluctantly do it when being assigned. Currently, in addition to teaching, lecturers are involved

with academic research as well as enhancing training programs in addition to supporting

enrollment tasks, participating in multiple training courses, or public activities proposed by the

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school labor union. Thus, thanks to the evolvement with multitasking, lecturers can become

groups that can strongly propose policies for later university improvements besides students (M.

D. Nguyen, 2018; T. Q. Nguyen et al., 2019).

Moreover, because educators are the ones who have direct contact with the learners, they

will know the actual status of the learning outcomes from their pupils. Thus, they can evaluate

the feasibility of the current training programs towards the future development policies of the

university, as well as analyze the requirements and desires derived from the market labors. From

there, these can adjust the training programs to suit the accessibility and responsiveness of their

learners. For academic research activities, they are also the main person who directly involve

with the research tasks despite the status of the studies or their roles in the works. Currently,

many lecturers have graduated with overseas programs that delve into the field of research rather

than participating in coursework programs. Thus, they are the connectors between scholars as

well as other qualified Ph.D. students and the institution’s development-oriented governance

tasks through the cooperation in teaching or participation in administrating the school’s

operation (T. Q. Nguyen et al., 2019).

For the university-industry cooperation to create a products or workforce supply-demand

relationship, lecturers usually have the company information by asking their graduated graduates

and current pupils who are advised by these educators during their learning path. Therefore, it

cannot be denied that lecturers are one of the groups providing excellent supports for forming a

well institution governance system by recognizing and assessing the inappropriate in the

institutions’ operation through their working progress as well as interactions with other

departments, learners, senior managers in school, and business owners. Although they have a

high advantage to contribute to the upgrading education system, the majority of educators

usually refuse to propose their ideas about the modifications in proposed school improve-

oriented policies by giving cursory answers for avoiding offends the group of school councils

and vice-reactors in the university but they will discuss it through private off-campus talks for

many sensitive reasons.

2.3. The relationships between Corporates and University Governance

The business community involvement in guiding the development of the university has

been recognized and proven in many studies (Dinh, 2020a; D. K. Nguyen & Pham, 2017; P. T.

L. Pham, 2015). Although the business community is involved with administrative supports on

the improvements of Vietnamese universities in many different forms, drawing out a common

voice between academic scholars who are lecturers and business owners representing the

business community is a complicated issue. While business owners’ suggestions for the

institutions developments often focus on the question "Are the graduates good enough for

handling the works offering by company?" which is a combination of multiple unique and non-

related set of skill, lecturers usually wonder "What kind of knowledge that students should learn

to reduce the unemployment rate or achieve a correlated job – trained major pair?" In other

words, if the approach of the higher education sector is to cultivate the current human resources,

then the business representatives’ approaches are "workforce exploitation" and "head-hunting"

(D. K. Nguyen & Pham, 2017, p. 37). Thus, it can be seen that the gap in the relationship

between the graduates and the headhunters’ demands is huge, where the employers will search

for "non-professional workers," which is the product of "University 2.0," while the aims of the

current education system are the product of "University 3.0" - the workers who have

"multidisciplinary knowledge" and can "create new knowledge" (Dinh, 2020b). This is shown in

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the cooperation between domestic enterprises and domestic universities, mainly in the following

aspects: creating conditions for learners to practice; recruiting learners with high achievements

and effectively working rate during the internship period; organizing tours to introduce the firm;

providing cross–teaching sessions between business managers and university educators; offering

some project-based courses for a cross-checking and cross-evaluating between the training

program outcomes and the firms’ requirements (D. K. Nguyen & Pham, 2017). The above

conflict is believed to come from the fact that companies’ owners do not have confidence in the

learning process or learning outcomes of pupils–lecturers in the institution because of following

reasons: the short-term training periods for recent graduates, the passive interactions between

business owners and heads of universities, the distance in bonds between the subordinates and

superiors in corporations’ environments, the limitations, complexity, and regulatory barriers in

school and corporate governance mechanisms, the lack of information between parties when the

needs of business-university relationships arise (T. T. Nguyen & Bui, 2017).

In foreign countries, the bonds between universities and businesses are not limited to the

cooperation in improving the current programs’ curriculums and training the future workforce. In

fact, these connections are boosted by multiple ways through the cooperate contracts, for

example, the corporations will conduct their projects using the research teams from the

academies, academic products and applications created by students and educators can be

commercialized through business channels, companies owners will propose the strategies which

suits the social needs instead of the demands from specific firms or corporations, exchanging and

providing services suggested by experts from both parties (Dinh, 2016, 2019b; T. T. Nguyen &

Bui, 2017). Hence, the qualified workforce that is trained, managed, and developed by the

university system will be maximized utilized, resulting in the limitation of human capital flight

from the youth community. As a result, institutions can guarantee the quality of their current

offered programs, thus, create a premise on continuous upgrading the training curriculums for

incoming learners, improving the reputation of the universities, be able to regularly evaluate and

enhance the qualifications and professional competence of the lecturers, bridging the gap

between academic works and practical applications. At the same time, this also gives them

steady financial sources from technology transfers and selling research outcomes to corporations

while maintaining the identity of a research academy that focuses on intensive training compared

to teaching skills in vocational education (Dinh, 2016; T. T. Nguyen & Bui, 2017). Therefore,

maximizing the utilization of the relationship between businesses and universities will bring

significant benefits to both parties; however, this is still a sore problem in Vietnam since there

are limited institutions that can be forming this symbiosis which are universities that have their

firms such as Vietnam National University – University of Technology, FPT Polytechnic

University, and Hoa Sen University. After all, it is necessary to enhance, connect, and expand

the relationship between enterprises and academies in governing universities for further

improvements from that, the gap between the knowledge offered at these institutions and the

actual needs of the society can be closed in the future.

3. Governing University: The Entrepreneurial University Model

The entrepreneurial university governance model is inherently not new in the world, but

its popularity in the university market in Vietnam is still limited. Until 2017, only 43 out of 120

higher education institutions across Vietnam responded to the survey of Dinh (2019a), showing

that nearly 26% of the respondents owning a private limited liability company. His work also

points out the difficulties these enterprises deal with, mostly the juridical barriers, especially the

Enterprise Law, to their business activities and management systems in these corporations. For

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the universities that operate as a corporation, Yokoyama (2006) categorizes them into five

groups: “prototype university,” “entrepreneurial–oriented university,” “fledgling entrepreneurial

university,” “adaptive entrepreneurial university,” and “ideal type university” (Dinh, 2019a).

Although the development orientations of each institutions group are different, the ultimate goals

of these enterprises are not far from the social demands and gradually switch from social funding

to self-funding or self–reliant universities model for the schools’ main activities, including

teaching and research, which are the basis of the second educational revolution (Etzkowitz,

2008). In this perspective, Kwiek (2016) proposed three methods for boundaries removal

between the top level of universities governors and the managers at faculties and departments

unit in European entrepreneurial university governance, which is shown as follow:

Table 1

Methods for removing the boundaries and complexities in entrepreneurial university governance

in Europe (p. 59) (Kwiek, 2016)

Method

Examples

Forming a “flat structure” in institute In University of Warwick and many institutions

governance in addition to the removal of in Poland, the governance system is circle

faculties units in schools’ governance system around “the rectors, his collaborators, strategic

and limiting the boundaries between the management team, and departments” only

university governance board of directors and without the intervene of faculties, which are

the schools’ departments

considered as “the intermediary level”

“Keeping three level arrangements” beside This method is applied at the Netherlands

enhancing the “authority and responsibility” Twente University and the Sweden Chalmers

of members in the university governance University of Technology. However, granting

groups include the central board of directors, too many authorities to the department level has

schools’ departments, and faculties

raised the concerns about the risks of straying

from the schools’ original purpose, thus

dissolving the university’s operation due to

mainly focusing on economic activities instead

of academia

Increase

the

“professionalization

of This method is applied in most European

administration” in governance activities of universities. In this method, non – academic

the university governance board of directors works are carried out by experts instead of

inexperienced personnel recruited from within

the university. More specifically, these activities

include: “finances, student affairs, fundraising,

and connecting with alumni”

Source: Authors

It can be seen that the majority of universities in Europe have specialized in operations in

the schools’ governance by eliminating interference of institutes’ departments to the relationship

between the academic community and the university governance board of directors or grant the

authority for managing departments to experts with extensive experiences before putting these

experts to the central board. As a result, these universities’ governance activities and operations

become more apparent and transparent (Kwiek, 2016). In this field, Middlehurst (2004) proposed

effective entrepreneurial university governance as follow:

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Figure 1. Entrepreneurial university governance model of Middlehurst (2004)

However, in Vietnam, servile imitating this model is considered inappropriate because of

the Vietnamese political constitutions as well as the governance structure in this country, which

is shown in the work of H. T. T. Pham et al. (2019), where the university governance can not be

separated from the involvements of government’s representatives thus causing the overlap and

complexities in the schools’ governance operations. Moreover, the number of departments and

divisions in Vietnamese universities is significantly large, and many of them will take care of the

same functions but are detached due to different types of studies, for example, the undergraduate

and graduate studies, or too specific functions in details thus bringing the complications and

confusions in handling the administrative tasks. Therefore, based on existing literature, we

propose a university governance model as follow:

Figure 2. Proposed University Governance Model (Administration Level)

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Figure 3. Proposed University Governance Model (Senior Management Level - Policy Maker

and Future Development)

Basically, the proposed model does not change much compared to the current operating

university governance model in Vietnam; however, the departments are grouped into specific

departments, with the least overlaps in handling administration tasks. In addition, our proposed

work utilizes the term ‘development periphery’ proposed by Clark (2004). Our study will

categorize this term as “senior management teams” and “junior management teams”; a vice-

rector will manage each. In this context, the team in the Makers and Future Development Sector

will deal with the works related to future improvements of the academy as well as connecting

with foreign-affiliated organizations, enterprises, and activities not related to academic activities.

Different from the prior team, the Academic Research and Training Sector will contribute more

on tasks related to academic researches, curriculum provisions, and developing policies on

enhancing the learning outcomes as well as the academic quality control. Finally, the junior

management team will handle the students’ or the university’s services, such as the library,

healthcare, and other related fields.

Figure 4. Proposed University Governance Model (Senior Management Level - Academic

Research and Training)

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Figure 5. Proposed University Governance Model (Junior Management Level)

4. Conclusions

This study proposes a model of autonomy university governance based on the

entrepreneurial university model. The shifting from the traditional institute model to

entrepreneurial university will help standardize, streamline, and enhancing the university’s

operation, thus limiting overlaps and unnecessary interferences from unrelated parties toward the

schools’ governance task. As a result, the institute’s performance will be significantly improved

and later catches the worldwide academia trend.

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