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Market intelligence for international student recruitment from ICEF
22nd May 2013

Working with commission-based education agents: the real issue

In a departure from our normal editorial coverage, we are pleased to present the following opinion piece from ICEF CEO Markus Badde on a topic that is currently being widely discussed across the industry: the ethics of working with and remunerating education agents.

Anyone involved in the international education sector knows that for some time, and especially in the United States, there has been debate about the ethics of using commission-based agents to help in the recruitment of foreign students. At ICEF – where many of our efforts are spent encouraging the highest standards of agent practice as well as helping institutions meet their recruitment goals – we have watched with interest as the debate has played out. At this writing, the debate seems to largely revolve around the simple proposition that agents compensated by commission = “unethical.” Needless to say, we disagree. But more importantly, framing the discussion in this way discourages consideration of more substantive questions and issues surrounding the use of agents in international student recruitment. The reality is that agents have a legitimate role to play in international recruitment: the best of them offer real value to students and institutions alike. With this in mind, we believe the real issue at hand is how to work with and compensate agents in a way that:

  • Acknowledges that student-led demand for agents is here to stay;
  • Protects the best interests of students and institutions alike;
  • Contributes to a professional environment that respects and rewards high standards of practice and student services.

More and more students are turning to agents

As much as the world is increasingly interconnected, it is still a very big place, with thousands of miles – and airfare dollars – separating prospective students from the institutions that may be the perfect place for them to study. Students who are considering study abroad are aware of the substantial financial and time investment such a decision requires, so they are naturally interested in as much professional help as they can get to ensure they are making a wise choice. They are certainly using the web for research purposes, but study abroad still can’t be decided upon or “booked” on the web in the same way that a hotel room or even holiday can be – it is simply too large and personal an investment. The financial investment of and distance inherent in study abroad understandably creates demand for locally available experts who may help in everything from study plan counselling to pre-departure intensive language classes, arranging for standardised tests, flight reservations, planning for required insurance, visa and immigration assistance, pre-departure briefings, and even career guidance post-graduation. In many countries, there is now an expectation that such professional services are to be found via an independent education agent/agency. These agencies are established service providers in the region and the majority of them have a record – and reputation – of placing local students successfully in appropriate foreign institutions. It is estimated that more than half of all new international enrolments to Australian universities now come through agents, as do at least a third of new British international enrolments. The reasons for this are simple. For students and their parents, agents are important local advisors who provide support for the complex decisions and processes associated with study abroad. For institutions, agents represent a cost-effective way to recruit internationally and to establish a local presence in markets abroad. In many cases, they are also an important extension of institutional support services for prospective and incoming students.

Agents are increasingly required to attain recognition and accreditation

Just as the expansion of the international education marketplace has encouraged growth in the numbers of education agents operating today, it has also necessitated mechanisms for assessing and encouraging the ethics and performance of those agents. As always happens in any booming economic sector, the burgeoning international education sector has attracted poor as well as outstanding agencies – and like all bad news stories, poorly behaved agents have captured quite a lot of attention. Here are just some of the unsavoury practices that have been reported:

  • Not disclosing that they’re working on commission;
  • Steering students to institutions that pay the most commission;
  • Misrepresenting an institution’s programmes of study, the credential conferred, and the portability of the credential;
  • Collecting fees for institutional services prior to the student’s arrival that they never forward to the institution;
  • Authoring student essays intended to assess the applicant’s written English proficiency;
  • Colluding with students in misusing the visa process.

All of these practices are of course egregious, but they are also rare and increasingly avoidable thanks to the quality assurance mechanisms now available to institutions in leading study abroad markets around the world. We operate a robust system of agent screening, quality assurance, and training at ICEF, and additional training and accreditation schemes are proliferating around the world. Moreover, in many countries agencies have decided to take the step of self-regulation by forming national as well as regional agent associations adhering to ethical codes of business conduct and standards. Finally, there are ways in which the marketplace naturally encourages good practices among international education agents. Unethical agents not only face stricter consequences in many countries for poor service or for breaching codes of professional conduct – they operate in an environment in which word-of-mouth about sub-par agencies travels extremely fast, both among institutions and students.

Why commission works

From our years of experience, we consider a per-head commission structure to be the most effective and transparent form of compensation of the various structures that are in use around the world today. By offering commission-based remuneration, educational institutions can expect and demand agent accountability, transparency, and ongoing student support. Specifically, a per-student commission model ties the agent's interest directly to those of the institution and the student. If the agent is not able to refer students that are well matched to the requirements and standards of the receiving institution, this will quickly become apparent to all concerned and the agent's relationship with the institution – and the income they derive from that relationship – will be at significant risk. Similarly, if a strong majority of students referred by the agent are not both (1) satisfied with the agent's service and (2) successful in their studies, this will quickly become apparent to all concerned as well – including both the receiving institution and prospective students – and the agent's ability to continue to generate referral commissions will again be placed in jeopardy. Needless to say, these are powerful levers in the agent-institution relationship in reinforcing a shared focus on student welfare and success.

Conclusion

International education agents are here to stay. To the extent that our current debate remains mired in simple, blanket assertions of poor ethics, we will continue to miss the real opportunity here, which is to find more constructive, collaborative approaches to engaging with quality agents and, in so doing, to improve both the recruitment capacity of institutions and the quality of service for students.

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