Motives of an Education Institute – Philanthropy or monetary

Figure this. An education institution. Just like any corporate it needs a board of directors and a profit motive is my argument.

At present, educational institutions in India can be set up only by non-profit companies or society and trust to get recognition from the University Grants Commission. Profits cannot be taken out of the institution and have to be reinvested. And neither can they pay dividends.

Hence in India, educational institutions need to be started with the will to promote education.

Say an institute is formed by an enterprising individual in collaboration with people who fund the setting up of the same. This institute is bound to grow with time and profits would be accumulated. Now if profits couldn't be withdrawn, then the only option left is the innovative siphoning of money. Which will happen. If that doesn't happen, there can not be a possible motive or drive for the management to promote the institute. After all, promoters are those who promote in anticipation of monetary returns. So in this case there will be a definite lack of management will and the only objective will be sustenance and siphoning.

Figure this. An education institution. Just like any corporate it needs a board of directors and a profit motive. Assume that profits are allowed to be withdrawn as dividends to promotors. This will foster management will and the motive to grow the institute in size and fame. This will automatically lead to proper pricing of services and hence a competitive market.

If the Govt of India is emphasizing laws in view of promoting affordable education to all, it is simply promoting mediocrity. If by annulling these, the price of education is to increase then there is a new market created. Viola!

Philanthropy is also a return to a promoter. Money is for those who don't trust philanthropy.