eNEWSLINE - Business Education News from AACSB International

Governance Models at AACSB Member Schools—Control of Aspects of Governance

September 2014

By Colin Nelson, Coordinator, Research and Knowledge Services, AACSB International

In an effort to continuously improve the level and quality of data AACSB International provides, a process of modularizing AACSB's largest and most comprehensive annual survey, the Business School Questionnaire (BSQ), has begun. This process will streamline the main BSQ, while affording participants the opportunity to drill down areas of particular interest in greater detail.

The BSQ Finances Module, the first in this series of planned modules, was released this year concurrently with the annual BSQ. By means of this module, AACSB International has gathered robust data on governance models within business schools for the first time. For example, one thing that is explored is the degree to which business schools have control over various, specific aspects of their governance, including:

Financial Management – The ability or authority to make executive decisions regarding the use of available operating funds. It also involves the level of control over the means by which those operating funds are obtained.

Determining Teaching Loads – The ability or authority of the business school to make executive decisions regarding the number of courses per academic period that a given faculty member is responsible for teaching.

Fundraising Efforts – The ability or authority to plan and undertake efforts to raise funds from external stakeholders.

Development – The ability or authority to control over general capital outlays for the business school. This includes the school's ability to plan and undertake efforts to develop new facilities for the business school, new or upgraded technologies for the classroom, etc.

Management of Overhead Expenses – The level of authority over the management of various non-direct expenses, including, but not limited to: accounting fees, advertising, depreciation, facilities maintenance and repairs, insurance, interest, legal fees, rent, supplies, taxes, telephone/Internet bills, travel expenditures, and utilities.

As discussed in the most recent post of AACSB's Data and Research Blog, the first thing asked of respondents in the survey is that they define their relationship with their parent institutions, if any. Schools that identify themselves as "Type A" are standard academic units of their parent institution, while "Type B" schools identify as semi-/mostly autonomous units of their parent institution (though they still derive their degree-granting authority from that parent). Independent, standalone business schools that have no parent institution, referred to as "Type C", obviously must handle all aspects of governance autonomously. Schools that identify as "Type A" or "Type B", however, must negotiate control over aspects of governance with their parent institution:

Figure 1. Control of Governance Aspects in "Type A" and "Type B" Business Schools

Interestingly, although "Type B" schools might have been expected to indicate they control most aspects of governance independently of their parent institution, more often than not they indicated that they did so jointly, or in consultation with their parent institution. The one exception was Determining Teaching Loads, but even among the "Type A" schools, independent control over this aspect of governance was reported just as often as joint control. Regardless, it certainly is the case that "Type B" schools are significantly more likely than "Type A" schools to have independent control of each aspect of school governance.