International high education providers attract international students through a variety of channels, including institutional cooperation, alumni networks, advertising, fairs and exhibitions, internet and social media marketing, education agents, and government organizations.With financial pressures and global competition (Lomer, Papatsiba and Naidoo 2018), increasing numbers of HEIs have outsourced international recruitment to agents (Robinson-Pant and Magyar 2018).
The Use of Agents
Utilizing international recruitment agents requires significant resources and presents risks to all parties involved. Despite discussions about the risks and expenses associated with using agents, there is still a lack of widespread understanding regarding the management and regulation of this recruitment channel across the sector.
Countries, like Australia and New Zealand have a comprehensive national framework and regulations that dictate the interactions between universities and agents. Similar guidelines have also been produced in the UK and the USA, although, unlike in Australia and New Zealand, they are not legally mandated.
In UK, BUILA, UKCISA and UUKI Jointly led by the British Council, has put in pace an Agent Quality Framework (AQF), designed to enhance the partnership between the UK education sector and agents and counsellors, and to recognize and share best practice, following extensive research with students, education providers, education advisers and agents.
Who is an Agent?
The term “agent” has been an important part of commercial discourse for many centuries. It typically refers to a principal who owns the goods or services that the agent has been entrusted to manage, distribute, or sell. Generally, an agent has the following responsibilities:
- Assisting in selling goods abroad.
- Acting on behalf of the principal by introducing them to overseas customers.
- Providing information and contacts for overseas markets.
- Identifying opportunities.
- Reducing the costs of establishing overseas offices.
Typically, the agent is expected to possess skills, knowledge, experience, or connections that benefit the owner or provider of goods or services. It is advantageous for the provider to engage the agent, and the agent, in turn, finds it beneficial to collaborate with or work for the provider.
However, it is important to note that the interests of each party involved are distinct. Agency theory highlights two main causes of principal-agent problems, which are linked to moral hazard:
- Goal incongruence
- Information asymmetry
In higher education an international education agent refers to a business entity that has one or more individuals acting as intermediaries between overseas students and education providers for the purpose of enrolling students in education institutions (Australian Government 2009; Nikula and Kivistö 2018)
Distinction Between Service And Commodity Aspects in Higher Education
It is important to understand that a university degree or qualification is not merely a commodity, but rather a partnership between learners and educators. This partnership offers benefits to institutions, students, and nations that extend beyond financial gains, encompassing academic, cultural, and diplomatic advantages.
Internationally mobile students have not only played a key role in the global knowledge economy (Scott 2015) but also in the financing model of higher education institutions (HEIs) (Ross 2020). This became clear during the Covid19 pandemic and consequent restrictions on international travel (Hillman 2020), especially in the top destination countries of the USA, UK and Australia.
The distinction between the service and commodity aspects of higher education, along with the challenges of affordability and attainment, underscores the complexity of selecting and managing education agents. It’s crucial to appreciate the role of agents, the potential risks and benefits of engaging them, and how they can contribute to the success of students, institutions, and countries.
The Most Important Services Provided by Agents in Higher Education Institutions
It’s important to recognize that agents play a multifaceted role, not just in generating income, but also in facilitating access to networks and optimizing the allocation of effort. This strategic function allows universities to broaden their presence in different markets without having to invest extensive time and resources in each one.
When collaborating with a student recruitment agency, students can benefit from a range of invaluable services tailored to support their academic journey. These services encompass:
- Personalized Consultation: Seasoned consultants offer individualized guidance, addressing students’ concerns and inquiries about pursuing education abroad.
- University Selection Support: Consultants aid students in identifying suitable universities based on their academic interests, career objectives, and personal preferences.
- Admission Assistance: They guide students through the application process, ensuring compliance with university requirements and deadlines.
- Test Preparation: Some agencies provide preparatory classes and resources to help students excel in standardized tests like the IELTS.
- Visa Guidance: Navigating the complexities of the visa application process can be daunting, but agencies offer comprehensive guidance to enhance students’ chances of securing their desired school placement.
- Accommodation Assistance: Finding suitable housing in a foreign country can be challenging, so agencies assist in locating housing options near the university campus, although institutions are increasingly stepping in to provide support in this area as well.
- Financial Aid and Scholarships: Some agencies help students explore scholarship opportunities and financial aid packages to ease the financial burden of studying abroad.
- Pre-departure Orientation: Before departure, agencies conduct orientation sessions to prepare students for the cultural, academic, and practical aspects of living and studying abroad.
The Risks Associated With Working With Agents in Higher Education Institution
The following are some of the risks involved on the part of an Institution while working with agents:
- ROI: There is a risk that an agent’s costs may outweigh the benefit, especially if the marketing agenda is expensive and fails to produce registered students.
- Reputation: Working with agents means the institution has less control over the sale of services, which can lead to reputational risks. Furthermore, an agent, with or without the agreement of the university, can have sub agents who then engage in activities that could damage the institution’s reputation.
- Investment Risks: Agents may advise on poorly researched market activities, leading to wasted resources (Ramia 2017).
- Fraud: There is a risk of fraudulent practices, such as collecting money from applicants or sponsors that result in underhand transactions.
- Financial Risks: Money transfers across borders in the early stages of relationships can be risky.
- Academic Integrity: Fraudulent practices related to test results (Nikula and Kivistö 2019), references, and visa applications can negatively impact the institution’s reputation. Additionally, accepting applicants with inadequate qualifications can harm the institution’s long-term brand.
Mitigating Risks Associated With Agents
In A lot of study abroad destinations each university that collaborates with agents has developed its own intricate policies, procedures, and commission structures, outlining a nuanced framework for these partnerships (Huang, Raimo and Humfrey 2016). However, Cao and Lumineau’s review (2015) suggests little monitoring is undertaken in contractual relationships whatever is specified in formal contracts. Principals tend to rely on the enforcement potential inherent in contracts to address opportunism (Kashyap, Antia and Frazier 2012
Studies on agency issues typically examines contracts from the perspective of outcome-based versus behavior-based approaches (Whipple and Roh 2010). This approach contrasts with the recognized necessity for a more nuanced examination when studying the contractual governance of agents in higher education (Huang, Raimo, and Humfrey 2016).
The HEI-agent relationship is influenced by two key contextual factors: HEI’s market power and the number of agents with which HEIs form contractual relationships (Huang, Raimo, and Humfrey 2016). Market power in the context of the Institution-Agent relationship in higher education refers to the influence a firm has on the decisions of its competitors and customers (Shervani, Frazier, and Challagalla 2007).
It is commonly understood that market power in higher education is often associated with the rankings of higher education institutions (HEIs) on league tables. However, another aspect to consider is the entry requirements, which are directly related to market demand and can serve as a proxy for market power.
For example, an elite university with high market power operates in a different context compared to a local community college with much less power. Furthermore, international recruitment agencies have become a significant industry with a wide range of sizes and power. These agencies vary from small one-person agents (price-takers) to large transnational corporations which can set contractual terms.
Building A Foundation of Trust To Achieve Success
Establishing trust and achieving success are interconnected and can significantly benefit all parties involved. This qualitative aspect often leads to measurable, quantitative outcomes. The following recommendations outline specific actions that individual institutions can take to improve their processes and relationships with agents:
- Develop comprehensive and stringent due diligence procedures for appointing agents. This includes understanding the returns on investment from working with agents. Ask probing questions about the agent’s methods, track record, staff turnover, and more. Obtain references from both the agent’s nominees and other individuals or organizations associated with the agent.
- Seek legal counsel before entering into agency relationships. Contracts should clearly outline behavioral norms, enabling qualitative and quantitative performance evaluations.
- Provide extensive training for International Office staff on collaborating with agents, emphasizing individual and institutional responsibilities and liabilities.Effective and respectful communication between the university and the agent should be an essential part of the support offered by universities.
- Maintain an ongoing process of due diligence through training, information sharing, support, performance evaluation, and performance enhancement. Assign a designated individual to oversee the entire process.
- Place students, both current and prospective, at the core of agent strategies by ensuring greater transparency about university-agent relationships and the foundations of the agents’ advice.
- Conduct an annual internal audit to evaluate agent activities and work practices.
Conclusion
To ensure a proactive approach, it’s vital for those responsible for appointing agents and those collaborating with them to undergo appropriate training. Understanding their potential liability for the acts of agents, even when unaware of those acts being carried out on their behalf, is crucial for all parties involved.
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