What’s in a name?

This magazine is called University Business: it’s about the business of Higher Education which seems straightforward enough. Yet most universities are of course charities – and so too is Eduserv, the company I work for, even though it’s in the business of providing IT services for payment. Does the charitable status of universities, or of Eduserv, make a difference – and, if so, what is that difference?

There’s certainly a common presumption that charitable organisations are good while commercial ones – at least in the educational arena – can be a bit dodgy. Current discussions of private higher education providers often draw a sharp distinction between “not-for-profit” (the University of Buckingham, say) and commercial (BPP for instance). But it’s not clear that constitutional status in itself justifies such judgements. After all, and notwithstanding the Charity Commission’s best efforts as a regulator, there are some pretty self-serving charities out there – and also some charities that may be impeccably altruistic in attitude but are hopelessly inefficient in operation. So before we start talking about our charities’ superiority to our commercial competitors, we’d better ensure that we manage our organisation as well as they do – and there may be some real challenge in achieving that.

But we then surely have to go further and offer more than the for-profit companies will normally provide. We need to make sure that the independence and focus enshrined in our charitable constitution is a source of real benefit for those we serve. As charities, we’re not vulnerable to takeover by opportunistic corporate predators; we’re not driven by the timetable of an IPO or venture capitalists’ exit strategies; and we’re not obliged to maximise short-term earnings. As a result we should be able to take a long-term view of our clients’ needs, and perhaps offer a transparency, or a flexibility, or a commitment not readily available from commercial providers. And it may be that we can also meet the particular needs of groups who in the short term aren’t an attractive market for private for-profit companies.

There is inevitably a limit to how far we can go. We are trading charities and we have to make ends meet. We can’t sustain offers that are predominantly uneconomic. Yet within that very non-trivial constraint there remains an obligation to be that bit different from our commercial cousins, whether we’re delivering higher education to the public or IT services to public good organisations.

Stephen Butcher is CEO of Eduserv. www.eduserv.org.uk