In June 2025, Professor Pamela Gillies presented a report to the Scottish Funding Council (SFC) following an independent investigation into the financial collapse at the University of Dundee. The university had become the only one among Scotland’s 19 higher education institutions to face such a severe financial crisis, prompting concerns about internal governance and decision-making processes.
Key Findings of the Report
- Systemic Financial Mismanagement: Despite sector-wide financial pressures, Dundee’s situation was exacerbated by internal failings, not just external conditions.
- Leadership Style: A top-down, hierarchical, and over-confident leadership culture discouraged challenge and transparency.
- Lack of Accountability: Senior management was not effectively held to account, and financial data lacked clarity and transparency.
- Governance Failures: The University Court and committees failed to challenge by asking critical questions or to respond with agility to early warning signs.
- Cultural Issues: The University culture discouraged dissent and promoted a misleadingly positive narrative which in turn contributed to poor decision-making.
Other Contributing Factors Identified
- Rising costs (utilities, staff pay, pensions)
- Underfunding in teaching and research
- Poor internal communication and risk management
- Inadequate financial forecasting and scenario planning
Recommendations
- Strengthen governance and financial oversight mechanisms.
- Foster a more inclusive and transparent culture where challenge and ‘curiosity’ are welcomed.
- Improve financial literacy and data transparency across leadership and governance bodies.
- Ensure early warning systems and a robust review, appraisal and challenge of the risk register.
- Frequent reports to the appropriate Committee and ‘Board’ on areas of high risk/sensitivity.
- Reconsider the inclusion of the Chair of Audit Committee in a Committee of Chairs of Committees (if there is one). Does this create unconscious bias?
In conclusion, the investigation underscores the importance of transparency, accountability, and a culture that encourages open dialogue in maintaining institutional resilience and financial sustainability.
How TIAA can help:
Our specialist governance advisory team can provide a Board Effectiveness Review with the following objectives:
- Improved Strategic Oversight – Helps the board clarify its purpose, align with organisational goals, and sharpen its focus on long-term strategy.
- Enhanced Governance and Accountability – Evaluates whether the board is fulfilling its duties responsibly, promoting transparency and ethical leadership.
- Identification of Skills and Gaps – Assesses board composition, highlighting areas where expertise or diversity may be lacking.
- Better Decision-Making – Reviews the quality of board discussions and decisions, encouraging more robust debate and informed choices.
- Stronger Stakeholder Confidence – Demonstrates a commitment to continuous improvement, which builds trust with students, regulators, and partners.
- Cultural and Relationship Insights – Sheds light on boardroom dynamics, interpersonal relationships, and overall culture—critical for effective collaboration.
- Regulatory Compliance – Meets expectations set by governance codes (like the UK Corporate Governance Code and OfS Governance Conditions E1 and E2 and the new E7 condition applicable to new registrants from August 2025)
- Efficiency and Time Management – Optimises board processes, meeting structures, and use of time, making governance more productive.
Our approach encompasses the overarching principles that should underpin a Board Effectiveness Review and focuses on both outcomes and behaviours. We work with the Chair to ensure a comprehensive and correct scope is agreed prior to commencement of our work as we recognise that ‘no one size fits all’. This approach also ensures that the Chair leads the review and retains overall responsibility for the process, whilst ensuring feedback from the Board and other key stakeholders are considered.
Our approach is designed not only to evaluate but also to support our clients in reflecting on and improving their Board performance. By engaging with a wide range of stakeholders and providing detailed, actionable recommendations, we aim to foster a culture of continuous improvement and strategic alignment.
Contact:
Helen Cargill, Director of Education
Nick MacBeath, Director of Governance, Risk and Compliance