Do our governance structures have the right skills to meet the moment?

Across higher education and research, governing bodies are being asked to make decisions in conditions that are more uncertain, more politicised and more financially constrained than at any point in recent memory.

In response, it is entirely understandable that boards lean into what feels safe: tighter controls, stronger assurance, and a heightened focus on risk. But this has created a growing tension between what boards are optimising for and what effective governance actually requires right now.

The question many institutions are now quietly grappling with is not whether their governance structures are robust enough, but whether they have the right mix of skills and capabilities around the table to meet the moment.

When uncertainty pushes boards towards compliance

Periods of instability tend to produce predictable governance responses. Risk registers expand. Financial oversight intensifies. Regulatory compliance moves further up board agendas.

These functions are important. But when they begin to dominate, governance can narrow. Boards become more focused on avoiding failure than on enabling good decisions. Challenge becomes procedural rather than substantive. And discussions about long‑term purpose, values and trade‑offs are squeezed out. The urgent begins to overtake the important.

Recent sector conversations reflect an awareness of this risk. There is growing recognition that governance effectiveness cannot be reduced to assurance alone, particularly when institutions are navigating ethical dilemmas, reputational risk and complex stakeholder expectations alongside financial pressure.

Skills‑based recruitment as a governance question

This is where a skills focus for boards and committees becomes critical. If boards do not have a clear picture of the skills they already have, it becomes difficult to understand what they truly need.

The CUC’s recent emphasis on skills‑based approaches to board composition reflects a wider shift in thinking: governance effectiveness depends not just on independence or experience, but on whether boards collectively possess the capabilities required to govern well in their specific context.

Too often, recruitment focuses on seniority, familiarity with the sector, or narrow professional expertise. These attributes have value, but they do not automatically equip boards to do the following:

• interrogate evidence under pressure,

• navigate ethical trade‑offs,

• understand and articulate risk appetite, or

• challenge constructively when decisions are finely balanced.

Skills‑based recruitment reframes the question from “Who would be a credible governor?” to “What capabilities must be present for this board to make good decisions in pursuit of its strategic goals?”

Managing the financialisation of boards

This question has become more acute as financial considerations have taken on greater prominence in governance discussions.

HEPI’s recent analysis and commentary point to a growing concern about the financialisation of university boards. This is not because financial oversight is inappropriate, but because it risks crowding out other forms of expertise and judgement.

Financial literacy is essential across our governance structures. Boards and committees must be able to engage with the financial information they are presented with. But when boards become overly dominated by financial, legal and commercial perspectives, other capabilities can be marginalised: ethical reasoning, academic judgement, strategic vision, cultural insight, and understanding of public value.

In our work, we see the consequences of this imbalance. Boards can become highly skilled at interrogating budgets while feeling less equipped to engage confidently with questions of mission, values, inclusion or long‑term legitimacy.

The challenge, then, is not to retreat from financial competence, but to balance it. Effective boards ensure that financial expertise sits alongside the skills required for ethical, strategic and values‑led decision‑making.

What the future of boards demands

Advance HE’s work on the future of governance points towards boards that are less transactional and more deliberative: boards that can hold complexity, tolerate uncertainty and engage with competing perspectives, rather than defaulting to control.

That future places different demands on board capability. In addition to technical expertise, boards increasingly need:

• strong ethical judgement and values‑based reasoning,

• confidence in working with incomplete or contested evidence,

• the ability to create space for challenge and dissent, and

• awareness of how power and voice shape decisions.

  
  

These are not “soft” skills. They are core governance skills, and they are decisive in determining the quality of decisions boards make under pressure.

From skills audits to strategic capability

One of the risks we see is that skills‑based approaches are treated primarily as periodic compliance exercises: a matrix completed, a gap noted, and little changes.

A more effective approach starts with strategy, not templates. Boards and committees that get the most value from skills‑based evaluation ask:

• What decisions will we need to make over the next few years?

• Where will judgement matter the most?

• Which capabilities are critical to making those decisions well?

Viewed through this lens, skills‑based recruitment and development become part of governance design, not box‑ticking. They help boards align composition with purpose, and capability with context.

Meeting the moment

The current governance moment calls for balance. Strong assurance matters. So does ethical judgement. Financial expertise is vital and so is the ability to navigate mission, legitimacy and trust.

Boards that focus exclusively on compliance and risk may feel safer in the short term, but they risk being under‑equipped for the decisions that matter most.

Skills‑based recruitment and evaluation offer one practical way of ensuring that governing bodies are genuinely equipped to do that work.

If you are reflecting on whether your own boards and committees have the mix of skills, our resources section includes a practical tool to support that conversation.