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Corporate Governance and Reporting in Contexts of Social Justice and Equity, Deconstructing the Case of Historically Disadvantaged Universities in South Africa

Written By

Valindawo Valile M. Dwayi

Submitted: August 2nd, 2021 Reviewed: October 12th, 2021 Published: March 3rd, 2022

DOI: 10.5772/intechopen.101188

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Corporate Governance - Recent Advances and Perspectives Edited by Okechukwu Lawrence Emeagwali

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Corporate Governance - Recent Advances and Perspectives [Working Title]

Associate Prof. Okechukwu Lawrence Emeagwali and Associate Prof. Feyza Bhatti

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Abstract

Historically disadvantaged universities in South Africa seem to grapple with corporate governance reporting issues, which continue to engender a state of perpetual crisis for them. In response, the National Department of Higher Education and Training has had to come up with interventions such as replacing university councils by administration regimes. The objective of this study was to examine and critique the underlying conditions that allow for the governance crisis to continue unabated while the government interventions seem to be in place. I adopted a mixed method approach to structure the study coherently and logically. Data sources were predominantly institutional reports about the selected cases, which remain as public records. By employing a critical realist lens and its positions about deep ontology, stratified reality, emergence and multi-causation, I could deconstruct the concept of corporate governance as generally written about in the mainstream literature. Results suggest that the source of the crisis derives from the complexity about corporate governance and reporting in relation to not only roles and responsibilities but also in terms of the ideas, beliefs, and values thereof, which therefore constitute the contradictions of position and practice. The discussion highlights the value of understanding transformative agency as the practical alternative to what should be advances in corporate governance and reporting.

Keywords

  • King IV report
  • social justice and equity
  • transformative agency
  • leadership Management and Governance
  • historically disadvantaged universities

“Human society has not developed in accordance with a prearranged plan, but empirically, in the course of a long, complicated and contradictory struggle ”.

Trotsky, 1986.

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1. Introduction

This article begins by exploring the construct of corporate governance as it is beginning to gain traction in the transformation project in South Africa post-constitutional democracy. While corporate governance takes flack within the debates about the managerialist practices, which are considered foreign in university leadership, management and governance, its value becomes apparent when the logic of university and its inherent weaknesses are laid bare against the perpetual crisis that the sector continues to experience. The argument that I advance in this article is that the conceptualization of corporate governance and reporting (CGR) ought to embrace the alternatives to what seems to be the mainstream narratives thereof if this concept is to remain context-based and culturally relevant. Such alternative understandings should include a concern with the mechanisms that seem to generate what is observable and experienced as governance crisis. It should focus on the underlying conditions for corporate governance and reporting if sustainable solutions are to be found about the enduring dysfunctional institutional cultures. The reality about the current practices is when the mainstream theories might be complicit in perpetuating structural disadvantage. This is the case when the claims about the KIV Code of Corporate Governance mask the actual reality due to de-ontological positions and self-referential explanations about the subject. It is therefore based on this argument that I would further claim that, only when drawing from the powerful theories about CGR that we might be able to have a better perspective about the present developments and in ways that the future practices can be more transformative than reproductive. Such theories ought to be able to resolve the CGR complexity. The failure to thinking in terms of the latter will inadvertently reinforce the current situation in the following three mutually inclusive ways:

  • The default position of higher education, which can be a disjuncture between its espoused value for the public good and the values of use. This is normally the case when CGR practices can inadvertently promote systems of domination and control.

  • The privileged position about the knowledge of CGR, which can be disadvantageous about the Other. This is normally the case when some forms of knowledge about CGR can be engaged in ways that are hegemonic about the Other; and

  • The faulty consciousness on the part of the main actors in management, leadership and governance practices and systems, which need to emerge, as powerful knowledge, at the level of corporate governance, and further about the idea of university education as socially responsive and progressive institution.

In the rest of this Chapter, I pursue this argument by discussing corporate governance and leadership practices as the matrix of power, which engender more of the continuities than the discontinuities from the old regimes of order and of truth. Such a discussion seeks to explain how such practices derive from the de-ontological positions and self-referential explanations. Second, I introduce the realist social framework to demonstrate how deep ontology and the value of a corporate governance as relations of power and knowledge offer a powerful explanation about corporate governance and reporting. Third, I draw on the realist framework to analyze corporate governance and reporting practices as cited from few selected cases. Such an analysis therefore takes a critical discourse approach whereby both structural systems and cultural systems are delineated as the generative mechanisms for the reproductive outcomes. Fourth and finally, the discussion highlights the value of understanding transformative agency as the practical alternative to what should be advances in corporate governance and reporting.

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2. The matrix of power: continuities and/or discontinuities from the old regimes of order and of truth

One of the enduring legacies of the racist apartheid system in South Africa, from which the university sector is a constituent part, is the question of the so-called historically black universities (HBU) or historically disadvantaged institutions (HDI) (these two terms are used interchangeably in this paper). This notion of blackness or disadvantage reflects how the present is constituted from power relations and materialist conditions as conditioned from the past regimes of order and of truth. Also, the transformation project in South Africa is documented in literature, such a university education category is part of a history, which was based on the racist apartheid system, whereby access to university education was regulated according to race and class. Such structural arrangements would promote systems that dispense power and privilege for some and not the Other. Such a history had such enduring effects even post democracy. For example, although the transformation of higher education and training in South Africa (HETSA) was envisaged into an integrated system and its enactment further well planned [1]. However, such plans seem to unfold in very peculiar circumstances for HBUs or HDIs. Convincing arguments are made that such proposals are still greatly conditioned in ways that effectively maintain a three-band structure, with the first- and highest-level band of universities predominantly representing the previously white and historically advantaged institutions [2]. Such a picture is also evidenced according to their apparent good performance profiles [3]. The last and lowest band is reflecting the relatively poor performance profiles coupled with enduring crisis, which are quite disruptive of the academic program almost annually.

That it is from this third lower band that most historically black universities tend to be represented, therefore, indicates what can be argued as the continuities from the old regimes of power and of truth. It, thus, illustrates the challenges of the transformation project in general and the governance challenges, which remain so crystallized despite almost three decades into constitutional democracy. In this sense, the transformation project, as the mechanism for change, is conditioned in the context of the old regimes of power, which continue to privilege certain forms of university education in socially exclusive ways for the Other. Therefore, the assumed trajectories about HETSA transformation remains the critical question about the present CGR systems and practices as continuities or discontinuities, the possible advances or stagnation from the old regimes of order and of truth. While the KIV Codes/Report was designed to deal with the previous regimes of order post democracy, such a project would become challenging as the dimensions about the regimes of truth in politics of being and knowledge.

2.1 King IV code of corporate governance and reporting

The conditions about the establishment of the King IV Report are well documented in literature (i.e., “For example, see [4, 5, 6, 7]”.). Such developments in the body of knowledge are responsive to how corporate governance is regulated in South Africa per the legislative framework [8]. The essence about KIV Report, as emerging from the previous versions of K1 to KIII, elaborated on outcomes of the service, the quality of the service as a fiduciary duty. In this way, the focus on quality in terms of the KIV version would no longer be about outputs, which was the purpose of KIII in relation to the three aspects of the inputs-process-outputs model. This point is important to distinguish, as general literature tends to conflate outputs with outcomes as the performance measures in the efficiency-effectiveness interplays, that is, in doing right the right things. In terms of the mainstream literature about transformation of university education, such developments could be located within the bigger debates about institutional autonomy and public accountability. Post the Millennium Development Goals, such developments as the King IV Report could also be understood in relation to what would be the new phase of the United Nations Sustainable Developmental Goals 2030 (SDG 2030), including the need for explicit monitoring, evaluation, and reporting functions as part of institutional governance (i.e., “For example, see [9]”.) Consequently, the King IV Report would provide a paradigm shift in how organizations can be better governed and led.

Therefore, while CGRs are significant in the running of university education, a consideration needs to be made about what the actual character is about the current CGR practices and thus subjecting the systems thereof and their assumed trajectories as to explanatory critiques. As I explain in the rest of this Chapter, the implicit assumptions about CGR as a structural system, while not questionable at the point of a cultural system, they become problematic at the level of human systems. That is, while it would be beyond critique to think about the CGR systems as beliefs, values and propositions about the idea of a university, the challenge begins when such beliefs are enacted by means of agency. This could therefore be understood as a unique challenge for the selected HDIs in the context of South Africa, where what seemed to have been espoused as values of use did not necessarily translate into values of use. In order to illustrate this point, in the following subsections, I describe the CGR cases according to the main elements of the KIV Codes, which are as follows:

  1. Leadership practices by the governing body, which entails the primary roles and responsibilities (the level of a structural system).

  2. The principles embodying the aspirations of the journey towards good corporate governance. Such principles guide on what organizations should strive to achieve by the application of governance practices (the level of a cultural system).

  3. Governance outcomes as the benefits that organizations could realize through good governance (the implications of the last to levels as agency).

The following cases reflect what could be understood as the disjuncture between the roles, duties and responsibilities and the ideal outcomes of corporate governance. In the selected cases of four HDIs (I used coding for each case of a university) in South Africa during the period from 2018 to 2020, there was compelling evidence about the extent to which members of university education leadership, management and governance could not adhere to the principles of ethical culture, good performance as sustainable value chain, effective control, and trust, good reputation and legitimacy.

2.1.1 KIV code practice: Steers and sets strategic direction

The following case is about HET-C sat against Principles 1 to 3 about the CGR role where ethical culture is espoused as the outcome:

“(Mr X) also questioned the manner in which his suspension was handled. He said he was given an hour to respond to the notice of suspension and the chancellor sent two security guards to his home to deliver the suspension letter as the country is on lockdown.”

The same reporting alluded to “horrifying acts of corruption and fraud in the procurement of security services.”

2.1.2 KIV code practice: Strategy, performance and reporting

Good performance as sustainable value creation, which is anchored on Principles 4 to 5 could be considered antithetical to strategy, performance, and reporting, according to the following evidence about HET-A:

“The breakdown of governance, along with maladministration and pervasive corruption”.

“There is a pervasive and shameless sense from certain organised formations – including unions, students and service providers – that they have a right to milk the institution dry with impunity. In the process, we have found, the mission of the university gets lost”.

2.1.3 KIV code practice: Overseeing and monitoring

Two HET-D cases reported the disjuncture of overseeing and monitoring, as leadership practices by the governing body, and the effective controls according to Principles 6 to 15.

During the site visits to the campus, splinter groups of students had chased other students away from the meeting, with the help of police and the Vice-Chancellor. The HET-D atmosphere was very polarized, which impeded the quality of the report’s observations and recommendations.”

The R11 million which had gone missing within the University system…….the perceived maladministration and mismanagement has increased the mistrust and negative image of the University.”

2.1.4 KIV code practice: Stakeholder relationships ensure accountability and disclosure

Principles 16 and 17 promote trust, good reputation and legitimacy as corporate governance and leadership outcomes. However, the following cases about HET-B created a typical case of espoused values and the values of use.

The general disregard of a fundamental principle of governance……they said the role of a council member, whether internal or external, was to contribute to collective decision-making for the benefit of the university. “It was the disregard of this principle, whether deliberately or in ignorance, individually or in groups, that led to the necessity for ministerial intervention.”

Disturbing signs of a widespread belief that the university is a kind of a cash cow which everyone is entitled to milk for personal benefit.”

2.2 Theorizations of corporate governance and leadership practices in higher education institutions as surface ontology

Prior to the advent of the KIV Code [4], integrated reporting had been the focus of the private sector, (i.e., “For example, see [9, 10]”.). Significantly, the King IV Code would be ‘more easily applicable to all organizations: public and private, large and small, for-profit and not-for-profit’ ([10]: 6). The significance of these codes begun to receive prominence at the international level. Literature (i.e., “For example, see [11, 12]”.) refers to the uptake in the Italian and Australian cases respectively. In the South African context, similar developments had been recorded about the history and benefits of the King IV Report [13], where arguments are made for the principle, whereby the boards should appreciate that strategy, risk, performance and sustainability are inseparable.

However, about these compelling cases, as outlined above, the National Ministry of Higher Education and Training [14] indicated the following situation about CGR in RSA:

  1. Fifteen (15) independent assessors had been appointed since 1998.

  2. The assessments revealed serious challenges with governance, and management at universities that destabilize the effective functioning of the institutions.

  3. In the majority (11/eleven) of these, the results were dissolution of council.

  4. In four (4) universities, investigations were conducted more than once.

Therefore, the practices, as alluded to the four selected universities and over 2018 to 2020 in South Africa, point to the challenges about corporate governance and reporting as continuities, instead of the discontinuities, from the old regimes of order and of truth, given the history of South Africa and its racist Apartheid system. As I argue in the rest of the chapter, such cases are masked in de-ontological positions and self-referential explanations thereof. What ought to be advances in CGR practices, and therefore in how such practices can be theorized, is when what seemed to be the actual values than the espoused would be a question about the complex university education context in South Africa and the expressively veracious consideration about the cases of HDIs. It seems that this category of the university sector is “hankering to be different or new” post constitutional democracy. Such efforts remain like “tinkering on the edges about the idea of a university as the public good, and thus rendering CGR practices as continuities from the old regimes of order and of truth.

There seemed to be compelling cases about the actual choices and projects by the incumbents (Council members), which then perpetuate the social ills of disadvantage, exclusion and marginalization about the Other (the community which should benefit from these universities, yet they cannot be due to the seemingly forms of kleptocracy in the high offices of the university). The unfortunate picture here is that all this seemed to take place despite what had been extensively written about CGR from the mainstream theories. Therefore, with the latter point as granted, such would be the case of when CGR, as a social phenomenon, needs a powerful theory because the present, while normal, seems to have normalized as part of heavily reliance on what appears as common sense knowledge. Such forms of knowledge preoccupy themselves with what works and what does not about CGR practices, while the actual scholarship of engagement about CGR should be about the conditions that constrain or enable the practices.

The state of CGR for the cases of HET by 2019 indicated evidence of the reproductive instead of the transformative mechanisms [15] as implicit about the nature of corporate governance in the selected cases. They constituted a network of outcomes, which are the antitheses of what corporate governance ought to be but are reproductive of the state of social injustice and inequities that the beneficiaries of university of higher education seem to continue to be subjected to. To arrive at such observations, one had to make inferences about the mechanisms that seemed to generate such a situation in contexts of assumed corporate governance as the ideal of King IV versus the actual as evidenced by the findings.

2.3 The realist social framework for analysis of corporate governance and reporting

The category of HBUs or HDIs, as briefly alluded to in Section 2.1, happen to be in what used to be Bantustans or areas which used to be “black reserves”, according to the old the racist apartheid system and its spatial planning policies. Theories who draw on critical realism, as a philosophy, namely, [16] argue that such a history constitute the “conditioned state” about the present, which is inherited not because of one’s making or choices. Such theories further explain why such a state needs to be understood in terms of the three elements of structure, culture and agency, which, while mutually constitutive, need to be treated as analytically distinct. Only when such a conditioned state can be clearly delineated as relations of structure and agency and further as culture and agency, that and the social scientist can be able to understand the planned outcomes, which can either be transformative or reproductive, or the variations of these, about the conditioned state, depending on the mechanisms thereof as the process of socio-cultural and social interactions. Therefore, the process of refining and developing ‘the transformative mechanisms’ for what corporate governance should entail being reflective about the logic of university education in contexts of social justice and equity. While such a reflective process is situated in the main debates and conversations about institutional autonomy and public accountability, such debates are themselves conditional on the CGR contexts as evidenced in this paper. The process itself is made quite significant, since both institutional autonomy and accountability are, ironically, enshrined in the world celebrated Constitution of South Africa and its Bill of Rights.

For the purposes of the argument in this chapter, (Figure 1) portrays how the realist social theory, as an explanatory program, allows for the CGR deconstruction in ways that transformative agency can be a subject of emergence. CGR takes three elements of the social world as relations of structural system (SS), of a cultural system (CS) and of a human system (HS). It is important to note that, according to [16], what appears as structure, culture and agency operates at the level of systems (each of the Structure and Culture assume the macro level, which are about structural arrangement and logical connection, respectively, while the Agency acts back on both at micro level). Therefore, SS means leadership by the governing body, corporate governance roles, duties and responsibilities, for the assumed outcomes, and based on the declared principles of corporate governance as its guidelines, the aspirations, and benefits to the organization. CGR as CS refers to the knowledge systems or discursive resources that the incumbents might be drawing on in abiding by, or not of the CGR principles. In both cases of SS and CS is therefore the relative weight of Agency, which, by acting back at the micro level, might constitute either the embodied (the right actions about corporate governance) or the opposite (the disembodied selves). In all these accounts are therefore the implied assumptions about each of these elements of CGR as a social world,

  1. That CGR practices at the level of a structural system (roles, duties and responsibility) is the proxy for the actual outcomes. The crisis as indicated in Section 2.1 confirms what could be the danger of such a logic.

  2. That CGR practices at the level of a cultural system (beliefs, ideas and propositions) is a value free exercise, and is thus apolitical, asocial and neutral.

  3. That CGR practices at the level of the human system (action or non-action) means that the incumbents have adequate agency to act according to the principles. The outcomes as indicated in Section 2.1 attest to the folly of such a logic, further to the notions of CGR as a cultural system and as a structural system.

Figure 1.

The domains and social reality of corporate governance and reporting as mapping of Archer, 1996; 2007 overBhaskar,1998; 2008, as created by the author.

In the next section, I, therefore, pursue this realist explanatory approach by discussing the silences and superficiality of CGR beyond the level of inductive and deductive logic, but at the level of abductive and retroductive logic. The latter refers to the application of critical discourse analysis about CGR practices as the subject of political interests, the materialist interests, and the related knowledge dimensions thereof in addition to how the latter two are taken upon as agency. The main claim about such an exercise is that the CGR practices, when they are subjected to a realist social program critique, then surface the discourses of use, which appears to be antithetical to the ideal of the KIV Code.

2.4 Deconstruction: The King IV code of corporate governance and reporting

Building on the growing body of knowledge about CGR should be the subject of a critique about the complexity of power relations in politics of knowledge and of being in the HETSA sector in general and in the case of HDIs. Such a project should not only be about the significance of transformation but the character of the project itself which seems to be constrained in the assumed trajectories and, as such, indicating interesting dynamics about CGR as the interplays of structure, culture and agency. This is therefore the reason for HDI cases in South Africa requiring prominence as the subject of explanatory critique in general and the cases of corporate governance crisis. Otherwise, the failure to embark on such scholarly projects would be travesty of justice to most communities who still reside in the communities where these universities are located, which is not because of a choice of their own but as part of the legacy of the racist apartheid system of South Africa. When such a system continues to be deliberately dehumanizing and brutalizing for those who should be on the receiving end about the idea of university as the public good, as evidenced in the introductory part of this Section, that calls for enhanced scholarship of engagement about such situations and how such engagement needs to be a reflexive-dialectical process, which can allow for transformative agency to emerge. In the subsequent discussion, I pursue the disjuncture between the CGR practices and the reported outcomes to possible identify the potential challenges and opportunities.

2.4.1 Deconstruction of the KIV CGR practices: What do they mean in critical realist terms?

Further to the profile of the HDIs as outlined in Section 2.1. was the challenge of their unique history and social relations. The old racist apartheid system of South Africa preconditioned such universities by means of special planning policies that would categorize such universities as solely meant for black and socio-economically marginalized communities. A deconstruction effort for the enduring crisis of corporate governance would therefore have to account for how such a crisis derives from the enduring systems of power as domination and control and further to how such systems could be justified as knowledge. A two-phase strategy about critical discourse analysis therefore is the basis on how I describe the enduring crisis of CGR in the selected cases of HDIs in South Africa.

The first phase would focus on the first two levels, the domains of events and processes and additionally experiences and observations. Analysis at this level would therefore focus on texts and how such texts can be deconstructed from the de-ontological positions and self-referential explanations about the crisis. Such cases take the notion of practice and narratives as mutually constitutive but become problematic in two ways. First, as a preoccupation with what works and does not work about corporate governance, which therefore does not go far enough in accounting for the conditions that enable or constrain for such events or processes. Further, such explanations are self-referential in the sense that they remain self-contained about the own mainstream narratives about corporate governance as a practice, instead of allowing for what could be alternative explanations. Therefore, both the challenge of surface or de-ontology and self-referencing need to be deconstructed by means of engaging the practices at the level of discourses [24, 25] if accurate interpretations can be made in ways that literacy about corporate governance can be better promoted. The second phase would therefore focus on the realist domain (3rd level). The subsequent sections describe how critical discourse analysis was applied as a form of a deconstruction process before the developed insights were discussed.

Therefore, in line with this critical realist viewpoint, the first two levels of actual and empirical domains (Figure 1) would not be helpful enough in accounting for how the crisis occurs and is further experienced and observed. Such levels are easily available in the form of hard data as outlined in Section 2.1 as the contradictions of the ideal practices and outcomes in corporate governance and leadership. In addition to what could be inductive and deductive logics about such a crisis, the critical realist analysis would have to draw both on the abductive logic (non-self-referential explanations) and on the retroductive logic (beyond the de-ontological positions) to account for the mechanisms which generated such a crisis. Not only the silences and superficiality about the crisis in corporate governance practices, but the analysis for the states and properties about such practices, would therefore have to be identified if credible explanations could be provided beyond the de-ontological positions and self-explanations about such practices.

In this sense, recognizing the structural systems, in the form of roles, duties and responsibilities, should be enabling and empowering instead of recognizing the systems of domination and control. Sense and meaning making, on the other hand, takes the cultural element whereby the logic about corporate governance should be inherent in the fiduciary roles and responsibilities as truth about and the emancipatory project for the other. This cultural element is what makes the logic of university education to be the common and the public good. This is what ought to be the intrinsic value of what university education, while the enactment of both the structural and cultural systems is what ought to count as a human system, and therefore as agency. Therefore, these are the issues that I sought to explore in the deconstruction of the King IV Report in the case of the selected HDIs in South Africa.

2.4.2 Deconstruction for de-ontological positions and self-referential explanations

The governance crisis [14] corroborates the previous studies [9, 10, 11, 12, 13]. For me, the latter cases question why in post democracy some institutions in the HETSA sector still experience continuities about corporate governance and leadership practices from the old regimes of order and truth. Albert Einstein defines insanity as doing the same thing repeatedly and expecting different results. The crisis as outlined in Section 2.1 seems to frustrate what should be the recent advances in CGR as the codes are espousing. As it is demonstrated in Figure 1, not only such cases reflect the domain of the actual but also the domain of the empirical about how CGR is observed and experienced both by the actors (CGR incumbents and the National Ministry of Higher Education and Training) and those researching about it. Such a CGR data attests to this situation as the silences and superficiality about CGR from a critical realist perspective. Because such data makes for the kind of knowledge which remains de-ontological and self-referential, it can thus be declared as common-sense knowledge. As such, the narratives about such practices, as evidenced in the Administrator Reports, constitute the contradictions of CGR practices, according to the KIV Report principles.

While this analysis acknowledges all the antecedent literatures about corporate governance and leadership practices, the explanatory critiques thereof constitute the advances in such a body of knowledge. A deconstruction process does not only seek to engage the current literatures but also offer potential solutions to the main challenge of de-ontological positions and self-referential explanations. Dealing with the challenge of ontological collapse about the current body of knowledge means providing the explanatory account about the states and properties of CGR as the conditions that enable/constrain CGR practices for the ideal of transformative practices than the currently reproductive. The explanatory critique about CGR practices is therefore about avoiding the ontological collapse in two ways—first, as reification (a blind concern with what works and what does not instead of an examination of the conditions or properties of structure, culture and agency) and second, as the conflation of position and practice about the incumbents in the CGR practices.

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3. Corporate governance and leadership and the contradictions of position and practice

The two-part deconstruction process, as outlined above, indicates corporate governance as the contradictions of position and practice. The challenges of policy-practice dissonance are when the government’s attempts for transformation might be regarded as the proxy for the actual change than the means to an end. At a micro level, such cases as reported here, are clear cases about when the dangers of the discourse of economic rationality and its neoliberal thinking can play out as pillage of public resources, which cannot be promoted in consideration of corporate governance as an ethical practice. Therefore, the realist ontology problematizes steering and strategic direction as leadership role and responsibilities (doing the right things right), for example, when such a structural system is posited as the proxy for trust, good reputation and legitimacy, as the actual outcomes. At the point of cultural system, the same roles and responsibilities would be a subject of critique when corporate governance and leadership are understood and explained as value free, apolitical, asocial and neutral. The same realist argument about the Council’s roles and responsibilities would also apply in all other cases about leadership roles and responsibilities, when those might be seen as the panacea for ethical controls. The same would apply at the point of a cultural system and the value-laden approach to the notion of corporate governance.

The cases as reported in this chapter indicate that, while the regulation of the governance roles is necessary, are such a regulation is not adequate for the actual practice to take place. This then becomes a realist question of what structural arrangements can mean in practice. That is, when such arrangements, as a structural system can be completely different from how such systems can be enacted. This is normally the case when the incoherence manifests as dissonances between the workings of power and the knowledge thereof and in ways that the discrepancies might have to be resolved in ways that are sustainably impactful. The cases, as reported in this chapter, indicate how corporate governance, although espoused as based on CGR principles, can also result in the opposite. Such is also the case of a social practice, which, with its beliefs, ideas and values being mutually constitutive, can be contested in actual practice. In the following paragraphs, I try to illustrate this point.

In yet another case of corporate governance and value systems, the discussions in the national parliament surfaced the challenge of treating the logic of university education and corporate governance in conflated ways. Such a case played out as political posturing, when some members of a political party could call for closure of these ‘rural based universities.’ Such a call invited objections from the other members of a political party. The next extract indicates such a case, when the role of university needs to be treated as analytically distinct from that of the leadership, management and governance systems thereof.

Ms X reiterated the concern over degrees being sold and the lack of focus on the consequences that perpetrators had to face. She expressed her agreement with Mr Z in the need for immediate intervention at HET-D. Ms X agreed with Mr Z that the university could benefit the development of rural communities and young people and so should not be closed but improved.”

The second case about the dysfunctional cultural system of corporate governance manifested when there seemed to be evidence of hegemonic tendencies about the other.

HET-C:“(Mr X) also questioned the manner in which his suspension was handled. He said he was given an hour to respond to the notice of suspension and the chancellor sent two security guards to his home to deliver the suspension letter as the country is on lockdown.”

HET-D: “During the site visits to the campus, splinter groups of students had chased other students away from the meeting, with the help of police and the Vice-Chancellor. The HET-D atmosphere was very polarized, which impeded the quality of the report’s observations and recommendations.”

Such tendencies manifest when they seem to perpetuate social and historical disadvantage, exclusion and marginalization, which was the main feature of the old racist apartheid system. Such notions of corporate governance need to be problematized as being misrecognition of the other, and further as being reductionist about the practice itself, when the alternative could be in consideration of context and cultural relevance in complex and open social systems. Such systems, therefore, call for understanding of corporate governance, and therefore managerialism, as engaged, instead of assuming it as a proxy for change, or as a value-free form of change.

3.1 Transformative agency: deconstruction for discourses of use

The domain of the real, and its claim for retroduction, points to the understanding of how CGR practices can present dilemma to the incumbents as the exercise of agency and what can be done about it. While CGR is regulated, it also takes the variation route at the point of human systems, thus indicating what could be the structural conditions or the generative mechanisms for such events. To drive home the point about the value of transformative agency, the following observation is quite instructive:

‘Powerholders and superordinate groups have both vested interests and the institutional and cultural capacities to disseminate their own self-justificatory beliefs across the rest of society, to misinterpret inegalitarian social relations as in the interests of everyone, or to justify publicly their own oppressive or exploitative institutions in the eyes of the downtrodden or subordinate.’([17]: 33).

The challenge about the latter statement is whether the people in historically black universities, in contexts of structural disadvantage in South Africa, have the voice which is loud enough for their self-empowerment and emancipation. Such a question would also relate to whether such a voice can be organized in ways that the power thereof can be more elaborative, thus leading to required conceptual or competence shifts. The potential resolution point about the current crisis of corporate governance and leadership should be the enhancement of transformative Agency by means of making loud the voice for social justice and equity when it should matter most. One could make the implicit assumptions that the Council members, as alluded to in Section 2.1, were well inducted to the workings of KIV Codes, and as such, such a process involved a plethora of workshops and conferences (the domain of the actual as reinforcing the quality of decision making in the CGR functions). However, the enduring crisis points to what could be the generative mechanisms for what appears as events and processes at the domain of the actual and further to how the latter is observed and experienced at the empirical level.

Therefore, the cases as reported in this chapter indicate that, while University Council membership qualities would be necessary, still they would not be adequate if the role of transformative agency is not made explicit in terms of both the power relations and materialist conditions of corporate governance, on the one hand, and the related beliefs, values and ideas thereof on the other hand. Such cases constitute the invariance or the reproductive state about social injustices despite what corporate governance espouses as institutional cultures that should reflect trust, good reputation and legitimacy. It would therefore be at the level of agency, as human systems, that the practical alternative could constitute the domain for what ought to be the new possibility about the reported crisis [18].

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4. The practical alternative towards enhanced transformative agency

Transformative agency is elaborated upon as one major element not only about the corporate governance as structural system but also about the related cultural system thereof. That ought to be about the idea of a university not only as knowledge constitutive but also as the public good. In that regard, corporate governance and leadership entail working with the necessary contradictions. It is about the reflexive-dialectical process, which ought to be about the correction of the idea of a Corporate Governance where such an idea seems to be subjected to conditions of constraints. While university autonomy means the protection of academic freedoms and rights in how the academic enterprise can be led managed and governed, on the one hand, public accountability, on the other hand, thereof means such rights and freedoms are not unmediated, especially in contexts of social equalities and justice. Therefore, based on these profiles, the case of HBU remains the main feature—rather, the unintended consequences of the HETSA transformation project. It is against these observations, therefore, that the contestations about the logic of university education, and therefore about the spaces where corporate governance reporting are applied, need to be seen as discursive spaces that reflect the matrix of power. Therefore, if the idea of a university as a public good is to become a reality for most people in South Africa, who should be concerned about the current corporate governance crisis in HDIs and what kind of projects and practices are required thereof? It should be considered hypocritical and therefore objectionable and rejected that HDIs would have Council members and yet their powers cannot be expressed as empowering knowledge systems and in ways which can promote social justice and equity for people who, by a choice not of their own, are still locked up in the previously disadvantaged backgrounds. Therefore, in the next two points, I illustrate how a refocus on what should be the transformative mechanisms in relations of structure and culture might be useful for resolving the disjuncture of governance purpose and outcomes.

4.1 The reconstructive efforts towards the advances in corporate governance and reporting

Transformative agency in corporate governance shall have been achieved when the corrective action efforts as relations of structure and culture, as discussed in Section 3, are not just being ameliorative about the status quo, as reported in the previous section. Corporate governance and leadership need to be improved in such cases in ways that the university profiles finally reflect the logic of university education as the public good for all. That would be the state, which can finally reflect a network of outcomes, which position corporate governance as the enabling system for the ideal of social justice and equity. Therefore, the practical alternative to the crisis as outlined in Section 2 would mean concealing the current constraints to structure, and to culture and therefore in ways that can enhance agency. To be more exact, this would also mean concealing constraints to the current corporate governance practices. Such an effort would have to try to disentangle the structure as roles, duties and responsibilities about governance from the enactment thereof, that is, as agency, and further the related culture as beliefs, values, and ideas about governance from agency. The results of the latter should be improved knowledge about corporate governance in context and culturally relevant ways. The following observation is quite suggestive of that approach.

‘the social struggles of the oppressed and exploited against such structures and their beneficiaries are morally right; they are objectively, ethico-political ‘right-action.’([17]: 36).

The HETSA cases as alluded here are calling for a time and spaces to reflect deeply on the constitutional values and how those values can be re-imagined as an idea of a university for a world beyond the present.

(Figure 2) portrays how the ideal about the CGR actors, in cases as described in Section 2.1, would have to be a subject of the reflexive-dialectical process, which would entail the socio-cultural conditioning of groups. Corporate governance and leadership practices take place as the idea of being in time and space. Such practices are lived by means of the dimensions about such states as criticality, reflexivity and for praxis. The matter of time as state of conditioning can be deconstructed as the habitus, as the pure conditioning to agency, which would have to call for the new processes as morphogenesis ([16]: 276) explains that “the point about morphogenesis is to clearly delineate who is who in these interplays and who does what in the process of social transformation’. An issue would be the CGR cases as the structure-agency conditioning as the habitus-reflexivity interface. Such cases reflect the state of morphostasis, the reproductive outcomes, the Habit-Reflexivity interface as predominant habitual action and low reflexivity (cultural and structural conditioning). That would therefore point to the need for the kinds of CGR practices which can allow for enhanced reflexivity in ways that, through morphogenesis, the cultural and structural domains (Figure 1) cause elaboration and overtime.

Figure 2.

Dimensions & realms: Corporate governance and reporting in the idea of a university(Dwayi, 2021).

Therefore, being reflexively dialectical about corporate governance would have to entail a process that could allow for transformative agency to emerge [19]. Transformative agency in cases of a crisis of corporate governance cases should mean disentangling human action from the espoused duties, roles and responsibilities. It also means dislocating human action from the espoused ideas, propositions, and values about governance. Such a process of deconstruction allows for understanding the actual nature of contradictions, tensions, inconsistencies and lacks that come about when the structure is conflated with the culture, and further when the agency acting on structure might be conflated with agency acting on the culture. That process ought to involve understanding the practical steps for the incumbents’ choices and practices as being in the world of university leadership, management, and governance in contexts of social justice and equity which cannot afford to reflect corruption and malpractices. That would also mean the enactment of KIV principles in ways that, indeed, can promote value creation in historically disadvantaged institutions instead of diminishing the very limited resources in their disposal. For example, the HET-A and HET-D cases, when these institutions had to be subjects of the administration regime more than once post constitutional democracy, were quite illustrative about how government or social science interventions can die in their own tracks.

4.2 Reclaiming corporate governance and reporting for the idea of university as the public good

What is suggested in this chapter is the need for further engagement at the level of culture and agency and further through what could be a reflexive dialectical process [20]. Such a strategy can be effective only when there are deliberate and conscious efforts on the part both individual and collective agents to promote and monitor corporate governance systems more as the values in use than the currently espoused. While complexity shall always inform the nature of the world, and thus the potential surprises depending on scale, it becomes the responsibility of CGR scholars to note how the principles of governance, especially in the university education environment, can fail in their own tracks. As I briefly alluded in Section 2 of this chapter, HETSA is still fragmented along power interests and knowledge domains of class, power and privilege almost 30 decades into constitutional democracy. As evidenced in the main thrust of the discussion in this chapter, the HDIs are not only a subject of marginalizing tendencies by the historical systems of domination and control, but members making University Councils in these institutions continue to perpetuate structural disadvantage as double marginalization about the Other.

University education spaces are for the public good and for how such goods can be dispensed for the betterment of all. University Councils cannot afford to appear as dispensing the material good in ways that benefit those who are already positionally advantaged and at the expense of the Other. University education constitutes spaces for Enlightenment Values where the name of the game ought to be for the truth about, and the emancipatory project for, the Other. That then points to how university education, as the potential system of dominance and control, can be engaged as the alternative system in service of the Other. Therefore, deconstruction should be about the potential to address the constraints on human freedom and enabling power in the HDI contexts.

A focus on the structural conditions or the generative mechanisms at the domain of the real would mean being deliberately conscious about the interplays of structure, culture and agency factors in open and complex social systems. This could mean contracting the incumbents (Council Members) in terms of the required knowledge for the CGR and even building capabilities for them to possible have conceptual and competence shifts about the ideal CGR outcomes. Therefore, the practical alternative is possible only when CGR can be understood as analytically distinct in the following three ways:

  • As roles and responsibilities which need to be understood and explained as mutually exclusive from the values, beliefs and knowledge systems thereof.

  • While the roles cannot be treated as the proxy for the transformative outcomes, the same applies about the CGR cultural dimension, which needs to be understood as contested in power and knowledge dimensions.

  • Implied by both is how the roles and responsibilities, and the value systems thereof can then be acted upon as agency. Such agency depends on the structural and cultural conditioning of groups. Therefore, it would be the laziness of an intellectual project to assume that HBUs in general and the case of HDIs are adequately empowered for such agency, given the enduring legacy of settler colonialism and the racist apartheid system which South Africa is so notorious of.

This could be a well-developed program for the duration of the tenure of these members, where the ability to internalize the basic CGR principles seeks to eliminate (contingent contradiction) the current social ills while protecting (the necessary compatibility) the idea of a university. Such a process should entail impact tracking about CGR and for sustainable value creation about the idea of University in the HDI context. For South Africa, the National Democratic Revolution Project in general and the National Development Plan 2030, which need to emerge as the United Nations Sustainable Development Goals 2030, and further as Agenda 2063: The Africa We Want Such projects for value creation are constitutive of the reflexive imperative. The CGR practices, as discourses of use, should entail the enabling system for the university context in the South African context as the culturally relevant and a responsive project for each case of university education. Such a context would need to consider how the HDIs continue to be in perpetual crisis because of history and social relations, which was never of their own making. However, such a history needs to be reimagined and better elaborated on as the expressively veracious considerations where the idea of a university finally constitutes the public good. For the corporate governance and leadership practitioners, the clarion call is for the ability to dispense power and privilege more for the previously disadvantaged than for themselves. For the growing body of knowledge, which is the ambit of scholarship, such an ability means praxis artistry, the ability to ensure the unity of theory and practice in practice.

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5. The conclusion

The potential advances in the study of corporate governance and reporting (CGR) practices need to be understood in terms of the contemporary theories of change. Engaging the theories that draw on the realist social theory, which is anchored on realist philosophy about deep ontology and stratified reality, causation and emergence, can delink the political and economic interests about CGR practices. The realist social explanatory program allows for the understanding of structural systems as the interplays with the cultural systems thereof, and how that knowledge can be taken upon as agency. There is a need to understand corporate governance and reporting practices as emerging from the basic and the running thread to what finally becomes a corporate governance and reporting culture. A critique of the practices as alluded to the selected cases of this chapter sheds some light on why and when such corporate governance, while regulated, the crisis persists even against the regular state interventions. The cases of unethical conduct cannot be condoned if the business of university education is about the enlightenment values and their twin friends of truth about, and the emancipation project for, the Other. Such cases are clear evidence about how corporate governance in university education can be constitutive of the unethical culture. Such cases are being about opportunistic about university education transformation, which is therefore, against the ideal for the public and the common good.

As it were, corporate governance in general and the King IV Report is not the panacea for addressing all the social ills that tend to characterize the contexts of enduring social injustice and poverty. Literature on King IV Code of Corporate Governance and Reporting is still in an early stage of development. Furthermore, the HDI cases in South Africa need a particular focus beyond what is currently reported in literature. Therefore, the ideological stance that the actors of corporate governance can draw upon need to be troubled in ways that the practical solutions about the enduring crisis might be better understood and explained. A deconstruction approach is, therefore, suggested for how the relations of structure, culture and agency can be identified and analyzed, and for how understanding the interplays between the three elements in ways that the current crisis can be effectively ameliorated if not completely uprooted, at best. For that to be a practical alternative, only with the kind of transformative results, which promote the socio-structural conditions of justice, fairness, democracy and empathy, that the idea of corporate governance in HDIs might be the actual reality.

The cases as reported in this chapter are not representative of the whole HETSA sector, but of a particular context whose transformation events seem to play out in ways that are quite peculiar about the logic of university education. However, the principles drawn from the analysis and the subsequent discussion might be generalizable to other similar environments. More studies and insights are required about the conditions that seem to remain a constraint in ways that continue to make leadership, management and governance roles susceptible to maladministration practices. The units of analysis thereof are much bigger than the limitations of this chapter. They entail a focus within the institutions themselves, at the interface of national or government macro-politics and the institutional micro-politics, and not to mention the impact of the current era of de-globalization, populism and regionalization. As I demonstrated in this chapter, what is claimed as the absoluteness of the principles of corporate governance shall be more realizable when such principles can be deconstructed in terms of the elements of structure, culture and agency, and where agency must be foregrounded as interacting with both structure and culture in analytically distinct ways. Failure to do that might be the reason for why even after the earlier studies about the administration regimes, corporate governance crisis still exists, and more administration regimes are still appointed in the South-African context.

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Written By

Valindawo Valile M. Dwayi

Submitted: August 2nd, 2021 Reviewed: October 12th, 2021 Published: March 3rd, 2022