Higher education, for profit

It is 12 years since I first had a direct encounter with a for-profit higher education institution (which must be distinguished from private but not-for-profit institutions). At the time I had just become Dean of the Faculty of Social Science at the University of Hull. The Business School, which had become part of the Faculty, had an arrangement with a private institution in London called  Greenwich College, under which the University of Hull validated the college’s degree programmes. In order to assess the value and integrity of this arrangement, I made an early visit to the college, and met its owners and some of its staff. There followed three years of productive collaboration between us, which was positive throughout. I think that, since I left Hull, the College has changed its name to Greenwich School of Management and has entered into accreditation and validation agreements with other universities.

In Ireland and the UK there are several for-profit higher education institutions, though none established as a university. All of them have accreditation relationships with either a university or a state agency; some have both. So for example, what I believe is the largest Irish institution of this kind, Griffith College, has most of its degrees accredited by a state agency, the Higher Education and Training Awards Council, but also has some accredited by a statutory UK institution, Nottingham Trent University. In this way, while the business plan and strategy for the college are in the hands of its directors and shareholders, the academic quality and integrity of its programmes is assured by external not-for-profit bodies.

The biggest accumulation of for-profit institutions is in the United States, and a good few of them are styled ‘university’. A listing of them can be seen here. They range from smaller specialised institutions, like Capella University,  to the massive online university, the University of Phoenix.  And there are others again like Harrison Middleton University, which covers a fairly wide spectrum (though only online) but uses what might be regarded as unusual sources and methodologies. A good few of  these institutions are accredited by the Higher Learning Commission, which is itself a private body but recognised by the US government.

And there are also a few US institutions (and of course ones in other countries) that would be regarded as ‘diploma mills’, which hand out qualifications and awards on the basis of criteria that would not pass muster under more rigorous accreditation frameworks.

So, is for-profit higher education a legitimate part of the sector, globally? What may make some people uneasy about such institutions is that they must pursue business plans that have, as their ultimate objective, the distribution of profits to shareholders. Indeed under company law, the primary duty of directors and officers of such institutions must be to the owners. This makes accreditation particularly sensitive, because unless the integrity of such oversight is absolutely assured, and is directed solely towards quality and educational standards, there would of necessity be questions about the validity of such institutions.

On the other hand, if properly supervised and regulated there may be a case for having such institutions, as they are often able to work in niche markets or provide useful supports to the traditional higher education sector.

But it may be useful to approach this issue more fundamentally, and to have a national framework that sets out the role and purpose of for-profit higher education and also provides appropriate monitoring and control of standards. Given the globalised nature of such education, it may be wise to regulate this sector through international institutions This may be the more appropriate because, without such international oversight, it is too easy for rogue institutions to operate and to compromise quality and standards. As Ireland has recently been associated (unfairly) with such institutions that claim to be based there but which in reality operate elsewhere, it may be appropriate for it to lead an initiative in this regard.

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5 Comments on “Higher education, for profit”

  1. Vincent Says:

    I’ve thought that the public private split here in Ireland is a bit vague. When top admin jobs are rotated such as to give most everyone a shot at the perks and pension or two.
    Not for profit, no I do not really buy it. It’s just that the shareholders operate from a far older set of rules.

  2. Jilly Says:

    There’s a related debate to be had as well about even the not-for-profit private institutions such as those in the US. Their accreditation is managed through a large number of state-recognised or state-run agencies, but in very different ways from those we’re familiar with in Ireland and, in general, the process is a lot less rigorous.

    In effect, private US colleges, ranging from Harvard down to small liberal-arts colleges few have heard of, are self-regulating. Some – like Harvard for example – maintain scrupulous standards which are some of the highest in the world. But this is largely because these institutions have chosen to do so, as such standards are effectively part of their business plan. The majority of the smaller, less prestigious colleges in the US do NOT maintain academic standards which we in Ireland would regard as acceptable for a university, even though they’re fully accredited by recognised and respected agencies.

    State-run universities are no guarantee of high standards, certainly. But private institutions are much more likely to be a ‘mixed bag’ where standards are concerned, even when they’re run as not-for-profit.

    And I would see for-profit institutions as containing a fundamental contradiction at their core, between the drive for profit and the drive for standards, which is ultimately irreconcilable.

    • Jilly, you raise some important issues. I’m not sure I necessarily agree with your final comment: all companies have to reconcile profits and standards whatever their line of business, and most manage it because high quality and standards represent a good business model. If this were not the case, we couldn’t allow a private sector for-profit company to do *anything* sensitive, like building cars or houses, as the same objection would apply. But I think we have developed a system that allows regulation to handle possible risks in the public interest.

      The question I would ask is whether we have adequately addressed the question of regulation in this sector, and in particular whether such regulation can succeed unless it has an international basis.

    • Jilly, I should also just add this: I am not sure that you can distinguish easily between ‘public’ and ‘private’ not-for-profit institutions. You mention Harvard as an example of a ‘private’ one. In what sense is its status different from, say, TCD’s? Neither is ‘owned’ by the state…

      Also, looking around the world, state control has probably created more abuse of HE standards than private control. It’s not that easy…!

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