Material risks and opportunities impacting value

Risks that may put our financial stability under pressure include the financial and related impacts of Covid-19, the lack of clarity about the proposed fee regulation model, declining external financial support for postgraduate students, reservations about the sustainability of the government’s funding model for higher education, and rising student debt.

Mitigation measures included the internal development of a financial impact model that is updated constantly and accounts for all variables that might impact on the financial performance of the NWU. The mitigation strategies include focusing on fundraising and endowment initiatives to provide new and sustainable sources of income, building available reserves to cover one year of operational expenses, engaging in optimal relationships with funders and facilitating start-up capital through the Technology Transfer and Innovation Support Department.

Risks in this cluster included insufficient levels of diversity (staff and students), vacuums created when key people leave, the lack of competitive salaries (academics), the perceived non-implementation of retention strategies, a change in stakeholder behaviour due to the Covid-19 pandemic, and uncertainties around the language plan implementation.

Mitigation measures included the implementation of a student recruitment and admission process** in line with the enrolment plan and diversity targets. Others were faculty language plans to implement the NWU Language Policy, a scarce-skill allowance, building employment equity targets into the performance agreements of managers, and developing and implementing retention strategies and clear position profiles for senior management indicating roles and responsibilities.

Risks receiving attention in this cluster were a decline in research funding and research, inadequate infrastructure planning for teaching, an inadequate global engagement/internationalisation effort, and a gap in standards between basic and tertiary education.

Other risks were the university’s apparent unpreparedness for a blended learning environment, slow external processes for approval of qualifications/programmes, over and under enrolment and the perceived inability to meet marketplace expectations if graduates do not find employment quickly enough.

We also focused on risks such as the possibility that undergraduate and postgraduate academic offerings and related services may not be sufficiently responsive, and a decline in student throughout and student success.

Mitigation measures were developing the enrolment plan (2020-2025), including infrastructure planning in budget planning, and establishing a space management project.

Other measures included Council approving our Internationalisation Policy, commercialisation and investment opportunities being explored in international markets and efforts to target international alumni for donations. With regard to throughput, quality admission and placement tests were performed for admission to students’ second and third choice qualifications. Measuring tools to track student success were put in place.

In this cluster, we focused on risks such as inadequacies in environmental management and information governance, fraudulent activities in some business processes, the inconsistent application of the Policy on Academic Integrity, non-compliance with health and safety laws and regulations, as well as with other statutory requirements, licences and legal requirements.

Mitigation strategies at play here were a focus on business continuity planning amid the Covid-19 situation, contingency planning for mission-critical processes such as registration and the implementation of our digital business strategy. Other measures included a compliance management process, compulsory training for all staff on the Protection of Personal Information Act (POPIA), positioning environmental management strategically, appointing departmental health and safety representatives, continually conducting occupational health and safety training and monitoring, and reviewing the Policy on Academic Integrity.

In this cluster, the risks receiving attention were varying student experiences across campuses, the perception that the university is not living up to its promise of social justice, inadequate measures to create a welcoming student environment, inadequacies in student leadership skills, and challenges with student safety on and off-campus.

Mitigation strategies included training programmes on LGBTQ+ and other human rights matters, leadership training and continually measuring attitudes towards the student offering.

The NWU has a policy and rules on gatherings and demonstrations, supported by emergency contingency plans for student unrest.

Worldwide, cyber security risk is regarded as the number one IT issue, necessitating more stringent cyber security measures at the NWU. The risk of a cyber-security attack is heightened in a period of digital transformation, which the NWU is currently undergoing.

Other risks receiving attention were inadequate IT provisioning for certain functions due to inadequate human resourcing of the IT department, and uncertainties about the digital business strategy, disaster-recovery planning and the possibility that core business systems could result in loss of students and income.

Mitigation measures included implementing a comprehensive cyber-incident and execution management system, developing a cyber-security strategy and deploying a security information and event management plan. A single centralised platform enables abnormalities in the NWU’s IT environment to be identified and escalated to the cyber-incident response team.

Commercialisation risks included missing out on commercialisation opportunities, the failure of licensees or spin-out ventures to commercialise, resulting in wasted resources, and offering non-compliant short learning programmes that deflect income away from the NWU.

Mitigation measures included a proper governance and management environment to ensure accountability and optimal functioning of the commercialisation space. Provision has been made for an effective financial and operating model for commercialised entities. The management structure of the Centre for Continuous Education has been renewed to enable more commercialisation opportunities.

An operational risk was inefficiencies in support functions, possibly leading to loss of income and potential growth, loss of staff and a negative impact on the reputation and ranking of the NWU. Other risks were absenteeism and loss of valuable staff owing to low staff morale.

Mitigation measures included a productivity and human resource allocation model, a process to reengineer business processes in preparation for the implementation of a new student information system, and a project to optimise space management and implement an electronic space-booking system. We also received a grant from the DHET to optimise our infrastructure development.