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Foreign branded schools cost-benefits

EducationWorld February 2023 | Expert Comment

Foreign trusts and corporates rarely plan to operate licensed schools themselves. Whether a local partner renting the Harrow name can truly recreate the ethos of the original institution is doubtful, writes Roshan Gandhi

Foreign branded schools cost-benefits

Indian school pupils will soon be able to follow in Jawaharalal Nehru’s footsteps by attending Harrow School, or spend their formative years ambling the corridors of Wellington College, without leaving Indian terra firma. These schools have announced they are setting up shop in Bangalore and Pune respectively, this year. Other famous school brands from abroad are set to follow shortly. While entry of branded foreign education institutions is a welcome development that can import new pedagogies and best education practices into India, we must also weigh the implications of their entry into India’s education marketplace from a critical angle.

The prime motive behind foreign education institutions establishing Indian affiliates is profit generation. This might sound like a statement of the obvious, but on closer inspection it’s not so straightforward. Indian readers are accustomed to nominally ‘not-for-profit’ private schools which in reality are promoter-operated, channeling surpluses into personal accounts of promoters through legal creativity. This is not true of British private schools, which are genuinely not-for-profit entities managed by governing boards whose members don’t have financial stakes in the institution. Delivering premium quality education is expensive, so despite high fees these schools often have to rely on additional sources of income to fund noble ambitions such as scholarships and new infrastructure.

Additional income normally comes in the form of donations from grateful parents and alumni. But now that British private schools are confronted with the prospect of losing their tax-exempt status, and economic challenges across Europe inhibiting the generosity of benefactors, they are obliged to find alternative income sources. Taking their brands overseas is the latest strategy devised to this end.
Foreign trusts and corporates establishing their school brands in India, rarely plan to operate the licensed schools themselves. The preferred model is to partner with local investor-entrepreneurs who provide land, buildings, and operations personnel (in Harrow’s case, Amity Group; in Wellington’s, Unison Group). The local investor pays the foreign brand a fee under the head of ‘educational services’, which includes use of the brand name and quality assurance to uphold the standards of the brand. The model is not dissimilar to the franchise model that many Indian education institutions already employ.

We can expect Indian affiliates of foreign schools to charge very high fees — upwards of Rs.16 lakh per annum, far out of reach for the vast majority of Indians. High fees per se is not a reason to be critical — there is nothing wrong with consumers making a free choice to purchase expensive services. But they raise the question of what patrons of these schools are looking for.

Elite schools are not new to India. High-fees boarding schools educating scions of the super-rich have existed since the 19th century, and it is well understood that elite families opt for such schools not only for perceived quality of education and character-building, but also for networking, association with an elite label, and exclusivity. But specific attraction to foreign brand identities, particularly British schools, suggests a certain colonial hangover; an underlying belief that there’s inherent superiority in having one’s education associated with respected institutions of the British establishment. Indeed, given that the operating model renders the authenticity of the experience questionable, one may reasonably be skeptical of whether a local partner renting the Harrow School name and logo can truly recreate the ethos the original institution has been carefully cultivating since 1572. Quite clearly, wealthy families will be forking out for name association above all other factors.

Two other observations confirm this conclusion. First, there are several other establishment schools that are highly respected within Britain, and whose academic results are on a par with, if not ahead of Harrow, Wellington, Rugby. But due to largely untraceable historical reasons, they have not attained the same degree of brand recognition internationally. Schools such as The Perse, Tonbridge, and Abingdon are household names in the United Kingdom, but it’s unlikely that Indian parents have heard of them. It is harder for these schools to establish a presence in India, a symptom of Indian consumers’ greater interest in their comparative renown than excellent substance. Secondly, several Indian schools now offer foreign curricula and quality of holistic education no less than that of renowned foreign schools, for far less fee. But evidently, this relative bargain is insufficient to dilute parents’ fascination with foreign brands.
Yet as Indians, we would do well to examine our own motives for availing the services of profit-chasing affiliates of not-for-profit institutions abroad. We must ask ourselves whether spending vast sums on prestigious foreign labels is worth it, or whether it would be wiser to repose trust in high-quality Indian institutions offering comparable standard of education.

(Roshan Gandhi is the Oxford-educated strategy adviser & former CEO of City Montessori Schools, Lucknow, managing director, GoCongo Foundation and international edtech consultant)

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