First ODL University in Malaysia UNIVERSITY FOR ALL

First ODL University in Malaysia UNIVERSITY FOR ALL

Presentation Outline • • • Introduction Purpose of the study Past Studies (Literature Review) – ODL, Corporate Governance KNOU Limitation of study Finding and Discussion: v the governing body – responsibilities, powers and accountability v good practices of KNOU • Conclusion and Future Research First ODL University in Malaysia UNIVERSITY FOR ALL

INTRODUCTION • Asia has over 70 Universities that are dedicated to open access to education. • 7 out of 11 mega universities are in Asia pacific Allama Iqbal Open University (AIOU Pakistan) Korea National Open University (KNOU - Korea) Sukhothai Thammathirat Open University (STOU – Thailand); Anadolu University (Anadolu-Turkey) Mega Universities in Asia pacific Univrsitas Terbuka UT-Indonesia) First ODL University in Malaysia Indira Gandhi National Open University (IGNOU – India); China Central Radio and TV University (CCRTVU – China, currently known as the Open University of China) UNIVERSITY FOR ALL

• There are many factors which contribute to the mega universities’ success. • It may be because of the delivery mode of the programs, the quality learning materials, society’s quest for knowledge and better academic qualifications, the dedication and caliber of university staff, and also the management of the universities themselves. First ODL University in Malaysia UNIVERSITY FOR ALL

PURPOSE OF STUDY/RESEARCH • The purpose of this study is to look at the governance structure and practices of KNOU as one of the successful open universities in Asia • Therefore, this paper will particularly looks at: (i) the powers of the management team of the university; and (ii) how the university’s good practices affect the business performance of the university. First ODL University in Malaysia UNIVERSITY FOR ALL

SIGNIFICANCE OF STUDY • Most of higher institutions nowadays offer distance education. • There should be very good corporate governance structure and practices to govern the operation and management of these institutions • The findings of this research show that the Korea National Open University (KNOU) has a very good governance structure and good practices which support its success. • On the international level, this study would give a clearer picture of KNOU’s practices and governance which could be implemented or followed by other ODL institutions, especially members of AAOU. First ODL University in Malaysia UNIVERSITY FOR ALL

LITERATURE REVIEW (i) Open and Distance Learning (ODL) • E-learning’ and ‘distance learning’ can be used interchangeably. ‘E-learning’ means ‘learning’ through electronic medium. • “All of the open universities in Asia have the same objectives and missions when they started their programs within their countries - that is to offer more access through multi-media methodology to those who cannot enter regular higher education institutions for diploma or degree courses” Professor Li Yawan, the former Secretary General (AAOU) First ODL University in Malaysia UNIVERSITY FOR ALL

(ii) Corporate Governance and Academic Institutions • Oxford University Gazette (2006): “the processes of decision-making within an institution [which] … enable an institution to set its policies and objectives, to achieve them, and to monitor its progress towards their achievement” • Finance Committee on Corporate Governance (Report on Corporate Governance, 2002): “the process and structure used to direct and manage the business and affairs of the company towards enhancing business prosperity and corporate accountability with the ultimate objective of realising long-term shareholder value, whilst taking into account the interest of other stakeholders” First ODL University in Malaysia UNIVERSITY FOR ALL

• Artero (2007) “the academic, professional, and policy field focused on how business institutions must be ruled, directed, and accounted for the welfare of all people involved” • Monks and Minow (1996), “the relationship among various participants in determining the direction and performance of corporations. The primary participants are the shareholders, the management (led by the chief executive officer), and the board of directors…Other participants include the employees, customers, suppliers, creditors, and the community. ” First ODL University in Malaysia UNIVERSITY FOR ALL

• Sporn, (2005), since the early 1990’s, governments in many European countries have changed the education market, by allowing institutional autonomy, creating a competitive educational market, and initiating market-like behaviour in higher education institutions. • Morshidi (2009) Due to the developments, the higher educations’ responses are basically strengthening their leadership structures, introducing new faculty governance models, movement towards an enhanced quality-control mechanism with accountability and focusing on human capital developments First ODL University in Malaysia UNIVERSITY FOR ALL

• Eaton 2006 ‘Autonomy with accountability’ in higher education refers to the higher institutions’ accountability about self-responsibility and self-regulation of academic quality • The Dearing Report (1997, UK) recognizes three guiding principles on the effectiveness of management and governance arrangements in universities: ①institutional autonomy should be respected; ②academic freedom within the law should be protected; and ③institutional governance should be conducted openly and should be responsive to constituencies internal and external to the institution First ODL University in Malaysia UNIVERSITY FOR ALL

• From the above discussion – corporate governance in academic institutions means how an academic institution is formally governed and managed. First ODL University in Malaysia UNIVERSITY FOR ALL

KNOU 1 st and the only government DE provider in Korea Vision: An Open University leading a lifelong learning society in 21 century First ODL University in Malaysia Facts & Figures • Established in 1972 • Current students: 180, 000 • Programmes: 22 Departments in 4 Colleges • Graduates: > 500, 000 UNIVERSITY FOR ALL

LIMITATION OF STUDY Areas of corporate governance Corporate Finance Corporate Culture Corporate communication Corporate Governance Corporate responsibility Corporate strategy First ODL University in Malaysia • CG has many areas, but this study only looked into two aspects that are corporate strategy and corporate responsibility • This study should looked at the university’s policies and circulars on the responsibility and accountability of the related committees, but as the documents are all in Korean • and due to time limitation, no study was done on these documents UNIVERSITY FOR ALL

FINDINGS AND DISCUSSION • In 2005, Kim Bowon et al, in their research entitled “A Research on Future Strategy of KNOU” mentioned about ‘governance system’ in the Development Tasks for the Reform of University Administration System. • The research proposed for the establishment or introduction of governance system in KNOU for a flexible decision making process and stable operation First ODL University in Malaysia UNIVERSITY FOR ALL

• According to the proposal, this will be done by: ①converting the object of policy-making or administrative control into the regional society, citizens and learners; and ②implementing the shared governance system through the strengthening of diverse and professional committee and the power of distribution for the strategic management of various data, other resources, customer oriented administration and complicated environment using a simple approach. First ODL University in Malaysia UNIVERSITY FOR ALL

• Considering that the task will take time to be implemented, it was included under the longterm promotion period. i. e. for the year 2006 – 2015. • KNOU management is trying their very best to reach their target on this task. • This will be discuss in two parts: ①The Governing Body - Responsibilities, Powers and Accountability ②Good Practices of KNOU (Planning and Strategy) First ODL University in Malaysia UNIVERSITY FOR ALL

The Governing Body Responsibilities, Powers and Accountability • Corporate governance works on the basis of two elements: responsibility and accountability. The management team is given the power and responsibility to make decisions for certain things and therefore they are accountable (to a certain extent) for their decisions. • The basic laws for higher education in Korea are the Higher Education Act, Act on Teachers and Professors in Public Education Institutes, Private School Act, Lifelong Learning Act and other related Acts on education (Jang-soo Ryu, et al. (2006) First ODL University in Malaysia UNIVERSITY FOR ALL

• The president of a higher education institution is ultimately responsible for supervision of the faculty, guidance of students and all the affairs of the institution. • From the KNOU organizational chart, it can be seen that in KNOU, the management team is headed by the President and under the President, there are several committees such as the Council of Professors, Committee of Academic Affairs, Committee of Colleges, Management Committee and also Committee of Graduate School. First ODL University in Malaysia UNIVERSITY FOR ALL

• Based on the two elements i. e responsibility and accountability, the discussion will be on decision making powers of the related committees. • In KNOU, there are two types of councils / meetings i. e with decision making power to make policy decisions and without decision making power to make policy decisions. First ODL University in Malaysia UNIVERSITY FOR ALL

① Committees with decision making power - - have legal rights to make policy decisions. ② Committees without decision making power - play a very important role by sharing or explaining ideas on why they will carry on certain programs or projects These committees or meetings can be divided into two groups: • Exclusive Meeting for Consultation • Extended Meeting for Consultation First ODL University in Malaysia UNIVERSITY FOR ALL

• The committees that can make policy decisions, are responsible and liable towards their decision. • This means that they are accountable for their decisions. • Accountability means that the decision makers would be answerable for any of their actions to the parties who have interests in their decisions either directly or indirectly. • the management is accountable to the shareholders for the use of company resources in the most efficient and desirable manner without regard to their personal interests or those of affiliated persons or companies First ODL University in Malaysia UNIVERSITY FOR ALL

• Due to the accountability, it is very important for each institution to have an audit committee. • In 2009, university self-evaluation is enforced in which all universities in Korea have to prepare standards and indexes for self evaluation • In KNOU, the Department of Planning and Evaluation is in charge for this. • Domains that have to be evaluated are the University’s management and finance, development of strategies and vision, education and community service, research and educational industrial cooperation, students and faculties and educational environment and supporting system (Bowon et al 2009) First ODL University in Malaysia UNIVERSITY FOR ALL

Good Practices of KNOU (Planning and Strategy) • Compliance with codes of corporate governance depended on the degree to which shareholders, board of directors and institutional investors believe in their ability to improve performance • it can be said that if a company is governed by good governance and practices, it will get good result and performance. In an academic institution, performance may include stability and sustainability of the institution, retain or increase numbers of students’ enrollment, maintaining good reputation etc. First ODL University in Malaysia UNIVERSITY FOR ALL

• There are several factors and practices of KNOU that may be followed by other ODL universities: ①University Support for Research Activities ②University’s Strategy and Planning ③International Cooperation and Academic Interchanges ④Lifelong Learning Programs First ODL University in Malaysia UNIVERSITY FOR ALL

CONCLUSION AND FUTURE RESEARCH • The boundaries of an institution are set by laws, rules and regulations, institutional investors and shareholders, corporate bylaws and internal practice codes and values as well as the community and public • Even though governance regulations are almost similar among industries, markets and countries, the legal and cultural frameworks have key differences among corporate governance conceptions. First ODL University in Malaysia UNIVERSITY FOR ALL

• The ability of the board leadership to create a positive and value-adding corporate culture is essential for any successful corporation. • It can be seen that practices of good corporate governance in KNOU is clearly applicable First ODL University in Malaysia UNIVERSITY FOR ALL

• This paper has succeeded in highlighting the practices of corporate governance in ensuring good governance of the University and the parties who are basically involved in implementing the practices of good governance. • The structure of KNOU may not be similar to other ODL institutions in Asia however, these shall not hinder the implementation of good governance in other ODL institutions especially AAOU members even the implementation might be different. First ODL University in Malaysia UNIVERSITY FOR ALL

• The future study may be carried on the other areas of corporate governance and also the detail study is needed on the governance structure by referring to the related circulars and policies. • All in all this research given a clear picture on how a mega university is managed and this may be followed or implemented by AAOU members to ensure the sustainability of their institutions. First ODL University in Malaysia UNIVERSITY FOR ALL

First ODL University in Malaysia UNIVERSITY FOR ALL