Reforms across European HE have enhanced the economic and managerial dimensions of governance (Magalhães et al., 2013). In the Finnish context, this development can be seen for example on the competitiveness discourse associated with globalization and the introduction of NPM. In Finland, the adoption of NPM-related principles has been influenced especially by the OECD, which has played a significant role in disseminating managerial and market-oriented ideas within public administration (Julkunen, 2006). To stimulate universities’ research outputs in global competition, performance-based funding systems have been introduced across different social contexts (Hicks 2012). In Finland this performance steering is conducted by the Ministry of Education and Culture (henceforth MEC).

Performance steering and the power dynamics between MEC and universities include fundamental contradictions (Silvén et al. forthcoming). At the legislative level, universities are considered as autonomous organisations with self-governance and academic freedom (Universities Act, Section 3). Parallelly, however, MEC intervenes—through strong political and performance steering—in tasks that fall within the scope of university autonomy (Tomperi 2009), such as research and the student selection. Therefore, this performance calibration from the policy level can be seen as top-down governance toward universities, that should be autonomous institutions (Silvén et al. forthcoming). Universities Act reform of 2009 made universities financially autonomous on paper but in practice still accountable to the state’s objectives through different performance contracts (Kohtamäki 2023). The internal funding model of many universities follows the indicators used by the MEC (Kivistö et al. 2021), which raises the question of how genuine the organisational autonomy of Finnish universities is in practice (cf. Poutanen 2023).

Inside universities, these contradictions can be observed, for example, in university management’s communication, where the autonomy of universities and academic freedom are emphasised on the one hand, while on the other hand the universities’ accountability towards MEC is highlighted. This goes both ways as MEC uses considerable political steering towards universities but can always plead to university autonomy when it is suitable for them. In other words, they are able to steer the universities actions but legally do not have any responsibilities on the end results of this financial governance.

Universities funding models and performance management in universities have been extensively studied at both international and national levels (e.g. Kivistö et al., 2019; Kallio et al., 2020). Most research, however, has been conducted at the macro level, leaving a clear research gap for micro-level analysis. Especially under studied is how university rectors understand their role in relation to performance management between the MEC and academic community.

With this presentation I am diving into the power dynamics between the MEC and universities regarding the university funding model. I am especially focusing on how university rectors describe the power dynamics of this financial steering and negotiations between the ministry and universities. The aims of my study are to:  i) recognise the influence of the university funding model set by the MEC has over how research is steered at the universities, ii) explore the agency universities have in relation to MEC funding model and, iii) analyse the role of the university rectors in relation to performance management between the Ministry and academic community.

The data set consist of interviews with current and former rectors (n=13) of all the universities in Finland. All the interviews were conducted online and lasted between 45 minutes and 1,5 hours. The themes covered in the interviews were: 1) power dynamics between MEC and universities (especially the negotiations between universities and ministry), 2) universities organisational autonomy in relation to the university funding model, 3) Performance management in the universities now and in the future, and 4) rectors role between the ministry and academic community. The interviews were semi-structured, maintaining consistency to topics covered across interviews, but also allowing the interviewees to move freely between the topics and the interviewer to pursue interesting lines of inquiry. The interviews were transcribed and then encoded with Atlas.ti in two iterative phases by the author (Campbell et al. 2013). In the first phase, data was coded in broader index-coding according to the interview themes, which were then redefined through a second round of closer analytical coding to pursue an answer to a specific research question (Deterding & Waters 2021: 715). All analytical codes were collaged together for thematic content analysis (Clarke & Braun 2017).

The analysis is still an ongoing process but the early findings suggest the following possible conclusions: 1) Rectors act as “performance management translators” between the MEC and academics (the contradictions) 2) There are radical division between the rectors on how they described the universities autonomy in relation to MEC 3) Performative role of the performance agreement negotiations between the universities and the ministry (“these are not real negotiations”) 4) Many rectors emphasised that academics are overestimating the power MEC has over universities. However, some are saying quite the opposite (contradictions)

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