In many countries, the non-profit model (or, as it's called in Vietnam, "not for profit") has many advantages that help these universities develop well. It's no coincidence that in world university rankings, besides the majority of public universities, most of the highly ranked private universities are non-profits. A group of these universities even consistently hold the top positions in rankings. The simple reason is that these universities have the capacity, and truly invest heavily, in the quality of education .
The reason they can invest in this way is because they don't have to share profits with investors or owners. In fact, these schools are not owned by any specific individual (or group of individuals). Furthermore, for many private universities, although tuition fees are expensive, they are still lower than the total cost of education. Therefore, these schools focus on recruiting the right target group without the incentive to enroll a large number of students (because the more students they enroll, the more losses they incur).
The principle of non-profit distribution and the ability to mobilize and develop a sustainable funding source are core issues that help PLN private universities create a significant difference compared to other university models.
How can we promote the core characteristics of the PLN university model in Vietnam: not distributing profits to owners and having the ability to attract funding?
To ensure the principle of non-profit distribution, the 2018 Law amending certain articles of the Higher Education Law explicitly stipulates this in the legal text, while still recognizing investors as owners of these universities. In contrast, the 2012 Higher Education Law limited the number of investors participating in the board of directors (meaning investors were no longer owners of the university), but allowed shareholders to receive dividends, albeit at a capped rate: not exceeding the government bond interest rate. In other words, the 2012 Higher Education Law largely eliminated the incentive for personal gain, as investors did not control the board of directors, but retained the motivation to mobilize community participation in funding (under reasonable conditions) for the university. In other words, the 2012 Higher Education Law appears more suitable than the 2018 Amendment to the Higher Education Law in promoting the private university model.
Besides considering a return to the regulations in the 2012 Higher Education Law, the next revision of the law could improve it to better suit the Vietnamese context. Firstly, only those who contribute capital should be allowed to participate in the Board of Directors, but the election of Board members should be based on personal merit, not capital. Secondly, the regulation allowing contributors to receive dividends could be amended to provide a fixed annual interest payment regardless of the university's performance. This would give contributors more peace of mind. Naturally, in this type of fundraising, financial reports and investment portfolios must be carefully monitored. Thirdly, a tax exemption mechanism (even a small one) is needed to encourage businesses to contribute capital to the development of PLN University. Large contributions are necessary to enable the university to invest strategically and sustainably.
The important point to emphasize is that we support a genuine PLN model, and this model cannot be developed through administrative orders. Therefore, private universities should not be forced to adopt the PLN model. Such imposition could easily lead to a pseudo-PLN model – where the university only takes advantage of policy incentives without creating benefits for society.
Source: https://thanhnien.vn/de-dai-hoc-phi-loi-nhuan-viet-nam-phat-trien-185240802001025073.htm
