The University of Bath was established as a University in 1966 by Royal Charter, from which we derive our legal status as an independent corporation. We are an educational charity, with exempt status and we apply our charitable purposes for the public benefit. We are regulated by the Office for Students (OfS) in its capacity as Principal Regulator and appear on its Register of officially recognised Higher Education providers.
This statement of corporate governance provides an overview of governance at the University, including the processes by which we ensure transparency, enable the student voice to be heard, manage risk, and assure the application of robust internal controls. As the Chair of Council, I take a leading role in ensuring that good governance is exercised by the University. Our objectives, powers, and governance arrangements are set out in our Charter, Statutes and Ordinances and in the Regulations which underpin them.
We are committed to exhibiting best practice in all aspects of our corporate governance. We conduct our business in accordance with the seven 'Nolan' principles of public life, namely selflessness, integrity, objectivity, accountability, openness, honesty, and leadership and are guided in doing this by the Higher Education Code of Governance (the Code) adopted by the Committee of University Chairs (CUC). Each year, Council reviews the University’s compliance with the individual elements of the Code. I am pleased to report that, for the period from August 2020 until November 2021, we are fully compliant. Council also commits to upholding the public interest governance principles set out by the Office for Students.
Corporate governance structures
Our governing body is Council. It is responsible for the strategic development and overall achievement of the University’s mission and purpose: a full statement of its responsibilities can be found below. Council membership includes staff and student members and a majority of independent, external ('lay') members. Council normally meets formally at least five times a year, with a number of informal sessions between these meetings.
Council delegates a number of its functions to its sub-committees, which include the Finance Committee, Nominations Committee, Remuneration Committee, and Audit and Risk Assurance Committee (ARAC). All these committees are formally constituted with terms of reference, which can be found on our website. They all have specified membership, with a lay Chair and majority in each case.
The Audit and Risk Assurance Committee (ARAC) is responsible to Council for reviewing the adequacy and effectiveness of our system of internal control and risk management, governance, and value for money arrangements. It also reviews the final version of the audited financial statements after they have been submitted to the Finance Committee, taking into consideration the auditors’ formal opinion. ARAC normally meets five times a year. Its work is considered in more detail under the ‘statement of internal control’ sub-heading below.
The Finance Committee is responsible to Council for financial strategy, budget setting, reviewing the annual accounts, monitoring investment activity, and consideration of capital expenditure. The Finance Committee normally meets four times a year.
The Nominations Committee is responsible for considering nominations for membership of Council and its committees, including the key roles of Chair of Council, Senior Independent Director and Treasurer, and members of Court appointed by Council. In making its decisions the Committee has regard to the diversity and skills of Council of members, which it assesses on an annual basis. It normally meets at least twice a year.
The Remuneration Committee determines the remuneration and contractual arrangements of specified senior employees of the University. It normally meets four times a year. Its work is considered in more detail in the Annual Report of the Remuneration Committee.
Senate is responsible for regulating and directing our academic work, with functions as set out in Section 19 of the Statutes. Senate provides assurance to Council that there is a programme in place for continuous improvement of the student academic experience and student outcomes. It also undertakes regular reviews to ensure the effectiveness of our academic governance is effective: a full review took place in 2019/20, the recommendations from which are currently being implemented. Senate normally meets at least five times a year.
Senate delegates a number of its functions to sub-committees, including the Research and Knowledge Exchange Committee and the Education, Quality and Standards Committee. All its committees are formally constituted with terms of reference, which can be found on our website.
Joint working of Council and Senate
Senate and Council are committed to working together to provide effective and joined-up governance for the University. As one element of this, they have a number of joint sub-committees, including the Council/Senate/Students’ Union Committee (CSSU); the Equality, Diversity and Inclusion Committee; the Honorary Degrees Committee; and the Senior Academic Appointments Committee.
The Vice-Chancellor and President is our chief executive officer, is a member of Council and Chair of Senate, and is responsible to Council for maintaining and promoting our efficiency and good order. In discharging this responsibility, the Vice-Chancellor and President is advised by the University Executive Board, which normally meets at least twice per month. Members are appointed by the Vice-Chancellor and President and include senior academic and professional service officers.
Council recognises that there are clear distinctions between governance and management. Governance involves oversight and assurance: Council members need to be satisfied that processes and procedures are in place which are sufficient, necessary, and effective in running our business. Management has to, amongst other things, advise the governing body on policies and objectives, devise means of meeting the agreed objectives, and is held accountable for implementing the policies of the governing body.
Court is the formal body representing the interests of our internal and external constituencies. It does not take part in the day-to-day oversight of our affairs or in the decision-taking process but provides a forum where members of Court can raise any matters concerning the University. It meets at least once in every academic year.
Reviewing our governance arrangements
In accordance with the CUC Code, Council undertakes annual reviews of the adequacy and effectiveness of our arrangements for corporate governance, risk management, and oversight of statutory and regulatory responsibilities. The last major external Review of Council Effectiveness was undertaken during 2017/18, with the next external review scheduled for the coming year. In each of the intervening years, Council has considered ways in which it can improve the discharge of its functions: this is an iterative and ongoing process, informed in 2020/21 by a self-assessment exercise and by individual appraisals of each member of Council, discussed by Council in July 2021.
It is central to the proper conduct of business that members of Council and its Committees act, and are perceived to act, impartially and not be influenced in their role by personal, social, or business relationships. A Register of Interests of Council members is maintained and updated annually. From 2020/21, each Council member’s entry in the Register has been published alongside their biography on our website. Any member of Council who believes that they may have a direct or indirect personal or financial interest in any matter under discussion at a meeting is expected to state that interest at the earliest opportunity and withdraw from the meeting when the relevant business is reached, unless invited to stay by the Chair. Members of Council are also required to declare if any of the contra-indicators published by the OfS in the context of ‘fit and proper’ person status apply to them.
Statement of responsibilities of Council
The matters specifically reserved for Council for decision are set out in the Statutes, and the requirements placed upon Council, as the governing body, by the regulator, the OfS, are outlined in the ‘Terms and conditions of funding for HEIs’ and the regulatory framework. The primary responsibilities of Council are:
- approving the mission and strategic vision of the institution, long-term business plans, key performance indicators (KPIs) and annual budgets, and ensuring these meet the interests of stakeholders
- appointing the head of the institution as chief executive of the institution and putting in place suitable arrangements for monitoring their performance
- ensuring the establishment and monitoring of systems of control and accountability, including financial and operational controls and risk assessment, and clear procedures for handling internal grievances and for managing conflicts of interest
- monitoring institutional performance against plans and approved KPIs, which should be, where possible and appropriate, benchmarked against other institutions
Council receives regular reports from executive officers on the day-to-day operations of our business and that of our subsidiary companies.
We are an educational charitable and chartered corporation, exempt under the terms of the Charities Act 2011. Members of its Council are therefore managing trustees of the charity. The OfS acts as principal regulator in respect of our status as an exempt charity.
In accordance with our Charter of Incorporation, Council is responsible for the administration and management of the affairs of the Group and is required to present audited financial statements for each financial year. Council is responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Group and enable it to ensure that the financial statements are prepared in accordance with the University’s Charter of Incorporation, the FE/HE SORP, and other relevant accounting standards.
Under Condition E3 of the OfS’s regulatory framework, Council must ensure our 'compliance with all of its conditions of registration and with the OfS Accounts Direction'. Council confirms that its accounts have been prepared in accordance with the OfS Accounts Direction and give a true and fair view of the state of affairs of the University and Group and of the surplus or deficit and cash flows for 2020/21.
Council is responsible for the maintenance and integrity of the corporate and financial information published on our website. Council notes that legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
In causing the financial statements to be prepared, Council has ensured that:
- suitable accounting policies are selected and applied consistently
- judgements and estimates are made that are reasonable and prudent
- applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements
- financial statements are prepared on the going concern basis unless it is inappropriate to presume that the Group will continue in operation. Council is satisfied that the Group has adequate resources to continue in operation for the foreseeable future; for this reason, the going concern basis continues to be adopted in the preparation of the financial statements
Council has taken reasonable steps to:
- ensure that public funds are used only for the purposes for which they have been given and in accordance with any specific terms and conditions from the Office for Students, Research England, and other public funding bodies
- ensure that there are appropriate financial and management controls in place to safeguard public funds and funds from other sources
- safeguard the assets of the Group and prevent and detect fraud and other irregularities
- secure the economical, efficient, and effective management of the Group’s resources and expenditure
In accordance with the terms and conditions of funding published by the OfS, Council is responsible for the use of public funds and has assured itself that we:
- have robust and comprehensive system of risk management, control and corporate governance, including procedures for the prevention and detection of corruption, fraud, bribery and irregularities
- have regular, reliable, timely and adequate information to monitor performance and track the use of public funds
- plan and manage our activities to remain sustainable and financially viable
- inform the OfS of any material change in our circumstances, including any significant developments that could impact on the mutual interests of the University and the OfS
- use public funds for proper purposes and seek to achieve value for money from public funds
- comply with the mandatory requirements relating to audit and financial reporting, set out in the OfS Audit Code of Practice and in the OfS annual accounts direction
- submit to the OfS:
- the annual accountability return, including signed audited financial statements prepared in accordance with the OfS Accounts Direction
- other information that the OfS may reasonably request.
- any data requested on the Office for Students’ or Research England’s behalf by the Higher Education Statistics Agency (HESA)
- the annual accountability return, including signed audited financial statements prepared in accordance with the OfS Accounts Direction
- have adequate and effective arrangements for the management and quality assurance of data submitted to HESA, the Student Loans Company, the OfS, and other funding or regulatory bodies
- have an effective framework – overseen by our Senate – to manage the quality of learning and teaching and to maintain academic standards
- consider and act on the OfS’ assessment of our risk specifically in relation to these funding purposes
To assist and enable it to discharge its responsibilities under the OfS terms and conditions, Council has designated the Vice-Chancellor as its Accountable Officer to report to the OfS on its behalf. The Accountable Officer is personally responsible to the governing body for ensuring compliance with the terms and conditions of funding and for providing the OfS with clear assurances to this effect.
Membership of Council
(between 1 August 2020 and 29 November 2021)
- Pamela Chesters CBE, Chair of Council
- Maria Bond, Appointed by Council
- Tim Ford, Interim Treasurer (from 26 April 2021) and Senior Independent Director
- Christine Gibbons, Appointed by Council
- Professor Dorothy Griffiths OBE, Appointed by Council
- Mesar Hameed, Elected by Professional Services Staff (until 31 July 2021)
- David Hardy, Appointed by Council
- Dr Marion Harney, Elected by Senate
- Dr Alan Hayes Chair of Academic Assembly (from 1 August 2021)
- Malcolm Holley, Elected by Professional Service Staff
- Tim Hollingsworth, Appointed by Council
- Professor Tim Ibell, Elected by Senate (until 31 July 2021)
- Francesco Masala, Student Governor (President) (until 30 June 2021)
- Don McLaverty, Appointed by Council
- Professor Marcelle McManus Elected by Senate (from 1 August 2021)
- Sujata McNab, Appointed by Council
- Catherine Mealing-Jones, Appointed by Council
- Charlotte Moar, Appointed by Council
- Dr David Moon, Elected by Academic Assembly
- John Preston, Treasurer (until 20 April 2021)
- Dr Andrew Ross Elected by Professional Services Staff (from 1 August 2021)
- Professor Ian White, Vice-Chancellor and President
- Dr Jane White, Chair of Academic Assembly (until 31 July 2021)
- Annie Willingham, Student Governor (Education Officer until 30 June 2021 and President from 1 July 2021)
- Jacob Withington Student Governor (Education Officer from 1 July 2021)
Statement of Internal Control
As our governing body, Council has responsibility for maintaining a sound system of internal control that supports the achievement of policies, aims, and objectives, while safeguarding the public funds and assets for which it is responsible. Council acts in accordance with the responsibilities assigned to it in our Charter and Statutes, and the regulatory framework and terms and conditions of funding published by the OfS.
We have established the following processes in relation to our risk management approach and for reviewing the effectiveness of our system of internal control:
- Council normally meets five times a year to consider our plans and strategic direction
- Council approves our Risk Management Strategy and Risk Register. Corporate risks are identified in terms of our ability to achieve our strategic objectives
- Council has established that the Vice-Chancellor and President, supported by the University Executive Board, is responsible for operational risk management at the institution
- risk management forms part of our planning process and covers all risks – governance, management, quality, compliance, reputational and financial
- faculties and key professional service departments have risk registers in place, which are updated annually as part of the planning processes, or as circumstances require, for example, in response to the Coronavirus pandemic
- we maintain a corporate risk register, which includes an evaluation of the likelihood and impact of risks becoming a reality. Council receives from ARAC a report reviewing the corporate risk register at each of its meetings, enabling it to make amendments in light of changes in the risk profile in particular areas. An overall report and updated register is considered annually
- Council reviews the effectiveness of the risk management process and internal controls via receipt of reports and minutes from ARAC throughout the year
- ARAC considers regular reports from the Head of Internal Audit on specific areas of the University together with recommendations for improvement. Audit planning arrangements and the methodology and approach of internal audit conform to the latest professional standards reflecting the adoption of risk management techniques
- ARAC approves the programme of internal audits and internal audits address value for money as appropriate. This informs the opinion on value for money in the annual report from Internal Audit
- ARAC considers other reports on matters of internal control, including the annual Procurement Report, the annual statement and any associated reports on Public Interest Disclosure, and the University policy and associated actions on fraud and irregularity
This system of internal control is designed to manage – rather than eliminate – the risk of failure to achieve policies, aims, and objectives: it can therefore only provide reasonable, not absolute, assurance of effectiveness.
Council is responsible for: (i) agreeing our key risks; (ii) approving the framework for risk assessment and management; (iii) monitoring risk management activities; and (iv) the continuous process of calibrating our risk appetite. It is also responsible for approving our Risk Management Strategy and the Risk Register and Management Plan. The Risk Management Strategy was last comprehensively reviewed by Council in November 2018, with an interim update considered in July 2021. It includes a statement about our risk appetite, a description of roles of responsibilities in relation to risk management, and the governance of risk management.
The Risk Register and Management Plan for 2021/22 was approved by Council on 22 July 2021. The Risk Register considers risk in nine areas of activity associated with the delivery of our strategic objectives (research, teaching, student recruitment & access, student experience, enterprise, physical infrastructure, IT infrastructure, people, and financial capacity). Performance, sustainability, and compliance risks are considered under each of these areas of activity. The Risk Register and Management Plan also include the super-ordinate reputational risk associated with a failure of its internal control and/or other practices.
At each of its meetings, ARAC receives a report from the University Executive Board on any developments, positive and negative, that might impact on the likelihood or impact of the risk becoming a reality. ARAC then reports to Council on these developments. In 2020/21 the University Executive Board continued to use the enhanced risk management reporting introduced in 2018/19, which includes a more systematic approach to reporting on the risk mitigation activities in the corporate risk register, a mapping of risks against strategic objectives, and the operational risk register.
Risk management is embedded within our decision-making processes and is therefore ongoing. Risks are identified through various self-assessment exercises or flagged by external agencies, including OfS and the Council of HE Internal Auditors. Strategic and operational risks are identified through our ongoing planning process, whilst most project risks are identified by individual project management teams. Our planning process provides a systematic approach to integrating strategic planning, financial planning, environment scanning, performance review, risk management, and resource allocation. Faculties and key departments are asked to update risk management plans as part of their submissions to the planning process, which provides a bottom-up, operations-wide assessment of operational and project risk. Our Risk Register provides a top-down strategic assessment of risk and addresses the risks to the achievement of our strategic objectives identified during the planning process.
ARAC considers detailed audit reports together with management action plans for the improvement of our systems of internal control. It monitors management’s response and progress made against the implementation plans. ARAC also receives and considers reports from the OfS, as they affect our business, and monitors adherence with the regulatory requirements. It is responsible for meeting with our external auditors and internal auditor and reviews and discusses reports issued. Whilst senior executives do attend meetings of the ARAC as necessary, they are not members of the Committee, and the Committee meets with the external auditors on their own once a year for independent discussions. The Chair of ARAC is available to discuss matters with the Head of Internal Audit or External Auditors. Council’s review of the effectiveness of the system of internal control is informed by the Internal Audit Unit. The internal auditors submit regular reports, which include the Head of Internal Audit’s independent opinion on the adequacy and effectiveness of the system of internal control, together with recommendations for improvement.
Council is responsible for ensuring that we have a framework of policies, procedures, and other internal control measures which are sufficient to assure itself that we are using public funding for the purposes for which it is received. We are in receipt of recurrent and capital grant funding from the OfS and Research England, as well as specific grant funding from OfS and UKRI. We also receive specific grant and contract funding from other central and regional government departments, agencies, and the NHS.
ARAC has oversight of our assurance processes for ensuring the accuracy of the data returns underpinning the formula-based allocations, and there is a rolling programme of internal audits of the returns. ARAC also considers reports from the Internal Auditor on specific publicly funded projects.
We engage in fundraising to support our charitable objectives. We reclaim Gift Aid from HMRC under our exempt charity status and we have a code of practice to which we adhere for the solicitation and acceptance of gifts.
Council’s review of the effectiveness of the system of internal control is also informed by the work of our executive managers, who have responsibility for the development and maintenance of our internal control framework, and by comments made by the external auditors in their management letter and other reports.
The system of internal control is based on an ongoing process designed to identify the principal risks to the achievement of policies, aims, and objectives; to evaluate the nature and extent of those risks; and to manage them efficiently, effectively, and economically. This process has been in place for the year ended 31 July 2021 and, up to the date of approval of the financial statements, has operated effectively throughout the year and accords with guidance from the OfS.