Compliance in Higher Education: What Is the Board’s Role?
Higher education is a highly regulated industry at the state and federal levels and the demands from the lawmakers, regulators, and the public continue to increase. There will always be a basic set of regulations that pertain to employment, financial, safety, and environmental regulations. The complexity of regulations for the industry is having a major effect on the compliance culture. Noncompliance, even when it’s unintentional, can lead to fines, lawsuits, and reputational risk. Boards currently play an important role in the compliance culture of an institution because their input will ensure that they have enough resources to fulfill their requirements and expectations for compliance in higher education.
Higher Education Struggles to Meet Compliance Standards
Federal regulations have increased substantially, especially within the last three years, making it extremely difficult for all colleges to stay up to date on their responsibilities. In many cases, regulations have been made hastily and without regard to smaller institutions that lack the proper resources and staff to be in compliance.
For example, Title IX of the Education Amendments of 1972 threatens the loss of federal funding for noncompliance. The amendment was passed without regard to consideration of smaller schools that don’t always have a clearly defined Title IX coordinator that meets the proper qualifications. As a result, many smaller schools continue to struggle with how to come into compliance with Title IX. The Education Department discourages Title IX coordinators that have conflicting job responsibilities. The rise and popularity of online courses and programs make things even more complicated.
To name a few other areas where higher education institutions struggle with regulations, the following list is just a beginning:
- Tuition and affordability of other costs
- Student loans
- Accommodations for disabilities
- College safety
- Alcohol and drug prevention
- Academic records management
In fact, regulation requirements for higher education are so complex and fluid that it isn’t realistic to believe that any campus could be 100% compliant at this time. There are a couple of processes that can help higher institutions come closer into compliance. Regulators may issue guidance via the audit process. If there is a complaint against the college or university, investigators are usually willing to work with the institution to help correct areas of noncompliance.
Fostering a Culture of Compliance
Since it’s impractical and nearly impossible for higher education institutions to cover every compliance base, boards almost have to consider compliance as a work in progress. For the present, it’s more practical for higher education institutions to work toward a culture of compliance.
In the current environment, it’s more prudent to address compliance in small, manageable pieces. As new programs develop, the audit committee can be instrumental in establishing policies and setting up priorities. Boards need to make a mindset switch as they change their goals to a compliance process and a culture that’s amenable to working with regulators to collaborate on voluntary resolutions rather than succumb to fines or other disciplinary measures. Regulators are likely to be responsive when faced with candor and systemic good faith efforts.
Compliance as Risk
Risk management committees address compliance as risk matters. Audit committees play a role in this area as well. As new compliance issues arise, audit committees need a process to ensure that they address them from the start. It’s the audit committee’s responsibility to ensure that they have policies and processes in place as new regulations are passed so the institution can effectively meet compliance obligations. Whether false reporting is intentional or unintentional, it can jeopardize the accreditation process.
Compliance Tips for Higher Education Boards
To help boards remain current on compliance issues, they should request regular reports from the audit and risk management committees. Boards should avoid attempting to manage compliance matters directly and leave that to the management team. The role for higher education boards in compliance protects the board and it preserves the integrity of compliance management by the managers that have been entrusted with that role.
Despite the enormity of regulations, regulators expect higher education boards to do their best to comply with the letter of the law and they must certainly comply with the spirit of the law. The Higher Education Compliance Alliance was created to provide the higher education community with a central repository of information and resources for compliance with federal laws and regulations. The Higher Education Compliance Alliance is comprised of 29 associations that represent higher education interests generally. The members of the Alliance share a commitment to providing information and resources on a full range of compliance issues and make them available to the higher education community. Many of the resources are provided free of charge. All information is available to members of the association.
In past years, lawyers used to take care of compliance matters, and in some cases, they still do. Another compliance duty for boards is to assess their legal needs and the skills of their legal staff to be sure they have the proper legal expertise. Attorneys should have substantial experience in regulatory law, preferably at the federal level. Bear in mind that discipline officers and Title IX coordinators often have law degrees.
On occasion, the Education Department also offers opportunities for negotiated rule-making where higher education boards and other interested groups can be involved in developing new regulations. This is an important and opportune time for higher education boards to improve the regulatory posture by being advocates with the Education Department to help balance the need for compliance with discretion and fairness to higher education institutions of all sizes.
The complexity of the compliance arena is an issue that higher education boards will need to continue to monitor. Having a positive view of compliance helps to promote higher education environments that are ethical and values-based, as well as being consistent with the institution’s mission. Compliance programs are intended to be educational and enriching, as well as serve as protection for the board, staff, students, and all other stakeholders. The challenge of the higher education board is to navigate these rocky and rapidly changing waters with thoughtful intent.