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Agreement of the governing bodies

Having looked carefully at the case for merger or federation at an early stage, the governing bodies will have to give their agreement to developing proposals. An initial agreement in principle to merge/federate may be given by boards subject to the outcomes of an appropriate due diligence exercise. 

Governance

At this point in recent mergers in the college sector, boards of management have delegated responsibility to a Partnership Board to take decisions on their behalf and oversee the merger process, including the development of the merger proposal, up to the point that a Shadow Board or new Board is in place.

The functions a Partnership Board would be expected to fulfill include:

  • Steering the work of a project manager to develop the merger proposal
  • Overseeing the preparation of the merger proposal
  • Overseeing consultation internally and externally
  • Overseeing the due diligence exercise
  • Preparing funding proposals/bids to SFC

Similar arrangements may be put in place for federations.

A Partnership Board Agreement

An accepted Partnership Agreement provides the terms and conditions within which this Partnership Board may operate. This allows the boards of the colleges to continue to focus on the governance of the individual institutions while the merger proposal and associated processes are progressed. For further details about setting up such an agreement and for a Partnership Board see:

Similar agreement documents for establishing a federation should be put in place.

Role of the Partnership Board

Following recent good practice, SFC recommends that once college Boards have indicated their agreement to merge then the colleges should establish a joint committee, empowered by the respective boards and including representatives from each college. 

This committee would be known as a Partnership Board.  It would have appropriate and significant authority to work towards agreeing the merger proposal.  A Partnership Board would rely on good will from the members to allocate the time necessary to make this arrangement successful.

SFC recommends that the Partnership Board includes the Chair and Principal of each college, an additional board member from each college and at least one staff representative and one student representative.

The Partnership Board should help the colleges take the necessary decisions and oversee actions to move them towards merger.  SFC recommends that individual college Boards delegate authority to the Partnership Board to:

  • Govern the development of a merger proposal and recommendations for implementation
  • Employ a project manager to support the merger process
  • Progress appointment of Principal Designate and senior management team for the new institution
  • Oversee the preparation of the merger proposal document
  • Consult internally and externally on the merger
  • Oversee the due diligence exercise
  • Prepare a funding proposal to request funds from the Council for the pre-merger phase
  • Develop, in principle, proposed terms and conditions of employment
  • Make any prospective interim appointments

Make the case to Ministers

One of the final stages of a merger is to formally make the case to Ministers. This is done once due diligence and consultation are complete. The governing bodies will have to agree and endorse the merger or federation proposal prior to submitting it to Ministers. This is in effect the final decision by the boards on whether to merge or not.

The proposal should demonstrate the clear commitment of the governing bodies of the institutions to merge or federate, as well as including a formal statement from the governing bodies to show that they understand and accept the governance arrangements and responsibilities of the new governing body. If Ministers approve the merger or federation, responsibility for the subsequent academic development and financial accountability and sustainability of a merged institution will ultimately lie with a single governing body.

A proposal to pursue a federation will also require the governing bodies to confirm their commitment to the principles of the federation and include a statement to confirm their understanding of the new governance arrangements.

This guidance was developed in 2012 and will be reviewed in 2017.

Your feedback is important so let us know where you have used it or how it can be improved by contacting Linda McLeod, email: lmcleod@sfc.ac.uk.

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