In an earlier post I had talked about private insititutions preferring to remain unaffiliated to the UGC/AICTE. But how are students to find out for themselves if the institutions offering the courses are credible and have the necessary infrastructure, facilities and staff of high quality and if the courses offered are really accepted by the potential employer community?
An educational rating agency can help address this problem. Just as Crisil (started in 1987) and ICRA (started in 1991) saw the need for an independent and professional credit rating outfit to provide investors and creditors with information on various companies and the risks involved, an Educational Rating Agency can do the same.
The National Assessment and Accreditation Council (NAAC) is supposed to rate higher education institutions affiliated to the UGC. The NAAC has developed a grading system on a scale of A++ (the best) to C (the worst). According to their web site,
NAAC is an autonomous institution established by the University Grants Commission (UGC). NAAC's primary agenda is to assess and accredit institutions of higher learning and help them continuously upgrade the quality of higher learning in the country.
This is better done by private sector organisations than one single government backed organisation, even if the government backed organisation is supposedly autonomous. Competing private sector educational rating agencies would be concerned about their own reputation and would be very careful about the kinds of ratings they dole out and are less likely to be influenced by the managements of the institutions into providing favourable ratings. The ultimate metric of how potential employers look at the graduates of an institution, would also figure promiently in the rating process - something that the NAAC doesn't seem to worry about.
I think the the financial sector has shown the way and we need to learn from their model, how the private rating agencies got started, the impact that they have had and continue to have in forcing companies to improve their financial management and reporting.
One of Government's biggest concerns in education seems to be a feeling that the private sector would cheat the public if there were no government regulation of the education sector and "profiteer" if allowed to run educational institutions for profit. This concern is true for other sectors like the Non Banking Financial Companies (NBFC) or for that matter even for all public limited companies that attempt to raise funds from the capital markets. But a combination of regulation (by SEBI, RBI etc.) and rating (by private agencies like Crisil, ICRA etc.) seems to have worked reasonably well with the regulation and rating processes themselves getting better and better over time. There is no reason why this can't be implemented in the education sector too.
I don't know of any educational rating agency (like the NAAC) for the school segment. Given that the demand for school education is much higher, the need for a rating agency is much more in the school segment than in the higher education segment.
There could be a business opportunity in here.
