Let’s Talk Value: How Universities Create Value for Students, Staff and Society

Main points:

  • Universities contribute to solving the world’s challenges and improving future workforce skills
  • A focus on value for money, efficiency and outputs sells universities short
  • Integrated reporting has improved university decision making and helped them raise funds
  • Universities can improve their annual reporting – they have largely ignored 20 years of developments in sustainability reporting

My new report Let’s Talk Value: How Universities Create Value for Students, Staff and Society published  by Advance HE explores the potential to change the way universities consider and describe: their use of resources and their outcomes; and, how they create value for their stakeholders, for example, through addressing global challenges and workforce and leadership skill needs and providing opportunities for individuals to fulfil their potential.

The report is being launched in London today at an event attended by university executives with speakers including Paul Druckman (UK FRC), Jonathan Labrey (IIRC)  and Russell Picot (TCFD). The event marks the culmination of a project led by Advance HE involving ten universities developing their approach to integrated thinking and reporting.

Current approaches to measuring and reporting performance, efficiencies and outputs, often driven by rankings, accreditation and regulatory assessments are missing the big picture. The report sets out steps that universities can take to articulate the value they create for their stakeholders and society through integrated thinking and the transformation of multiple capitals.

A review of a sample of UK university annual reports reveals that they have no clear purpose or audience and do not follow recognised reporting frameworks.  For example, universities have largely ignored 20 years of sustainability reporting developments by the Global Reporting Initiative.  However, interviews with university executives reveal the benefits of integrated thinking and reporting.

The report also draws on learnings from reporting on value creation and the application of integrated thinking and reporting from outside the sector to extend current thinking in the university sector on integrated reporting.  It takes a broader focus than the output measures used by ranking organisations and assessment agencies or the focus on value for money and trust of some agencies.

The report is a call to action to develop ways of measuring and articulating the broader outcomes of university activities and the value they create.  The focus on measures of output and financial outcomes used in rankings and assessments of universities does not convey the value they create.  The sector is selling itself short.  There are many examples through the report demonstrating how embarking on such an approach, challenging as it is, brings significant benefits and drives strategy towards developing long term positive outcomes including unexpected financial benefits such as reduced cost of capital. Defining what value is and how it is created also brings visibility to practices which destroy value.

Whilst this report is set in on the UK context it is relevant to the sector globally given the leadership role of UK Universities (along with South African universities) in the development of integrated reporting in the sector.   It is particularly aimed at University Executive Teams and their colleagues who are involved in external reporting and developing strategy and those who have a direct role in demonstrating, delivering and articulating value across their institutions.

The call to action extends to those who influence the sector.  There is much to be gained from sector wide thinking on the broad value that universities create, the outcomes (as opposed to outputs) they achieve and the measures that could be used.

The challenge for universities will be to draw on best practice outside the sector rather than create their own version of integrated reporting. There is some evidence from the annual reports examined that universities are not fully rising to the challenges of integrated reporting as set out by the IIRC (2013). Rather than defining the value they create they fall back on vision and mission statements. Thus, they fail to convey their contribution to solving the world’s challenges and improving future workforce skills.

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