Institutional risk reviews
Our Institutional Risk Review (IRR) process allows us to monitor closely governance, management and strategic direction in the higher education sector in Wales, and includes considering universities’ short, medium and long-term sustainability.In January 2018, we concluded that:
- Two universities should be assessed as at High risk
- Two universities should be assessed overall as at Moderate risk
- Four universities should be assessed overall as at Low risk
This process ensures that we can engage further with a university to monitor and understand better its management and monitoring of risks that we have noted through the process.
The number of universities assessed as being at ‘moderate’ risk highlights the increased level of engagement with them at this time of uncertainty around, for example, student demand both home and overseas, and competition for research funding. This is very different to making a ‘high risk’ assessment, where we believe a university faces threats to its short to medium-term sustainability. A moderate risk rating means that HEFCW needs to engage further with the university to understand better its management and monitoring of the identified risks. In fact, it will not necessarily represent a negative statement about a university as it may also be made where, for example, a university is driving major strategic change through a planned course of action that includes some degree of recognised, controlled risk.
In making IRR assessments, we take account of all the latest available data, information and engagements with universities including, for example, the latest audited financial statements and other annual assurance returns. The process integrates a financial health assessment with a range of other key risk areas:
- Governance and management
- Research and knowledge transfer
- Strategic direction
- Student and quality