Dozens demonstrated at the Australian Financial Review's Education Summit in Sydney amid allegations of bullying and harassment from top brass at prestigious universities and fears for 1500 jobs at six institutions.
In a speech to the summit, federal Education Minister Jason Clare said the powers of the regulator have not changed in the last 15 years.
"At the moment, TEQSA has a sledgehammer and a feather, and not much in between," he said of the Tertiary Education Quality and Standards Agency.
Mr Clare argued it needed better tools to step in and act on governance and leadership issues.
But he also gently took aim at the ballooning salaries of Australian vice-chancellors who are among the highest paid in the world, topping some Ivy League university leaders.
Their average salary was more than $1 million in 2024.
"Can I just encourage everyone again, don't be defensive about this," he said.
The National Tertiary Education Union (NTEU) national president Dr Alison Barnes commended Mr Clare but said actions are needed to match his words.
The summit also coincides with a NSW parliamentary inquiry being launched into university governance.
Former academic turned Labor MP Sarah Kaine, who will chair the inquiry, was among those who protested outside the summit in Sydney over the restructures.
"Universities are not just institutions of learning - they are public assets, civic anchors, and engines of social progress," Dr Kaine said on Tuesday.
"Are universities being run in the public interest? Are they accessible, inclusive, and accountable? Are they fulfilling their promise to serve society - not just markets?"
The union says 1500 jobs are on the chopping block across six of the state's public universities.
It noted it is in dispute with three separate NSW universities in the Fair Work Commission over failures to consult on major restructures and a lack of evidence behind decision making.
"There's a clear picture of a sector in crisis due to corporate greed and poor leadership," the union said on Tuesday.
"While staff are losing jobs and students are losing courses, senior executives and consultants are meeting inside the summit to discuss the sector's future without staff or student voices at the table."
It pointed the finger at global consulting firm Nous, which is sponsoring the summit, of having a "notorious track record in education in Australia" linking to job cuts across the higher education sector.
The union said the best interest of students is not being put first as the sector suffers from severe financial mismanagement, overblown salaries of university leaders, and suspension of course enrolments.
AAP has contacted Universities Australia and Nous for comment.
It comes off the back of former foreign affairs minister and ANU chancellor Julie Bishop being accused of humiliating an academic and driving her to "near suicide".
The allegations, aired during a Senate hearing, have been rejected by Ms Bishop, who denies engaging with any university council members or staff with anything but "respect, courtesy and civility".
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