BUSINESS leaders have hit out at controversial proposals to change the way Scottish universities are run.

Influential lobby group the Institute of Directors Scotland (IoDS) described planned legislation as "unnecessary" "inappropriate" and "wrong-headed" in a submission to the Scottish Parliament.

The attack is the latest in a wave of opposition to the Higher Education Governance Bill, which is currently going through Holyrood.

It includes proposals to appoint trade union members to universities' ruling Courts for the first time and make the powerful post of Court chair elected - potentially ending the historic role of rector.

Because the appointment and election of governing body chairs will be made through ministerial regulations universities believe that will threaten their autonomy.

Senior administrators also fear the new measures will lead universities to be reclassified as public bodies which would end their status as charities and damage their ability to raise money, with an estimated £450 million shortfall to be discussed at the finance committee today.

In a submission to the education committee, which is also scrutinising the legislation, David Watt, executive director of the IoDS, which advises industry on governance structures, said: "We believe it is wrong in principle..... to legislate on the internal governance of autonomous charitable organisations such as universities and that the proposals would undermine the autonomy and flexibility of Scotland’s universities.

"Given the tremendous success of our universities at home and abroad and their exceptional international reputation we are unclear what the problem is that this whole exercise is trying to solve.

"We recognise the need for the Scottish Government to hold to account organisations which benefit from significant amounts of public funding, but it is hard to identify any delivery or performance issues which would be improved by the proposed changes."

Mr Watt said the institute was "alarmed" at the precedent of "interference" in independent charitable bodies and the "potential for similar moves to be widened across Scottish civic life".

He added: "The success of Scotland’s universities has been based on autonomy and innovation and we fail to see how the application of a one governance model fits all strengthens this.

"We are concerned that increased government control and ministerial influence over the operation of our universities could have wide-reaching adverse consequences which could impact both on the future success of these institutions and the wider Scottish economy."

The Scottish Government has always denied that ministers want to control universities and said they were confident the new arrangements would not run foul of charities legislation or new European rules on public bodies.

A spokeswoman said: "There is no intention for the Scottish Government to have any involvement in the appointment process for the position of chair, or any other governing body member, at any institution.

"Any suggestion of us exerting greater direct control over the sector is just wrong. The Bill simply aims to improve governance by enabling our higher education institutions to embrace greater transparency and inclusivity in their governance arrangements.

"We will continue to take careful note of every constructive comment and suggestion made by stakeholders as the Bill progresses through Parliament."

Meanwhile, lecturers have hit out at US whistleblower Edward Snowden, the rector of Glasgow University, for his comments on the governance legislation.

Mr Snowden told new students via a videolink from Moscow on Monday that the reforms would damage student democracy.

In a letter to The Herald, Dr Iain Banks, president of the UCU branch at Glasgow University, said: "With his admirable track record of shining light on the darker areas of public life I would have expected that he would have been supportive of moves to bring a greater level of transparency and democracy to our institutions."