There has been a great deal of soul-searching and debate at the world’s business schools in response to widespread criticism that they were partly to blame for the global financial crisis. Many of the executives and bankers pilloried for the poor risk management and fiscal negligence that triggered the crisis have the letters “MBA” after their names. Did the business schools – so proud of their ability to churn out financial hotshots – get it wrong in the classroom?
The schools devoted significant amounts of time and money to deflecting the blame, emphasizing that their programs are ethical, sustainable and focus on good business practice. Blaming MBAs for the financial crisis, said Jenny George, dean of Melbourne Business School, “is as futile as blaming humans for it.”
Even so, an increasing number of people entering the business world genuinely want to avoid the questionable business dealings of their predecessors, or at least not be tainted by association. As a result, the current crop of business school candidates is very much geared toward sustainability, corporate social responsibility (CSR) and ethical leadership.
The QS TopMBA.com Applicant Survey 2010 shows that more MBA candidates than ever before, including Chinese students, insist on courses that have a strong emphasis on ethical learning.
“Emphasis on CSR and sustainability have become a major part of MBA candidates’ school selection criteria,” said Nunzio Quacquarelli, the survey’s author. “Schools demonstrating strength in these areas have seen a major increase in applications.”
Admissions officers confirm the validity of this trend, noting there has been a massive change in candidates’ interests. Questions from applicants about a program’s CSR credentials would have been unthinkable a decade ago.
Research conducted by QS also found that the number of candidates considering charity work after graduation has doubled in the last four years. Non-governmental organizations (NGOs) and charities have seen a marked increase in MBA applications.
The MBA Enterprise Corps, for example, a Washington-based NGO that sends MBAs to work for charities in developing countries, has seen a 100% increase in applications over the last two years. “[There has been] a continuation of extremely high interest from MBAs, based in the US or overseas, with an average of 100 applicants for each short-term assignment,” said Kareem Mansour, the program manager.
At an educational level, this has a massive impact on the thinking of business school deans. Many have taken steps to alter the structure of their MBA courses, adding optional or mandatory ethics-focused modules. The Aspen Institute’s “Beyond Grey Pinstripes” rankings now assess schools according to the amount of time spent teaching these issues.
Schools such as Stanford University in the US, ESADE Business School in Spain and Schulich School of Business in Canada highlight the fact that they offered CSR and ethical courses long before the financial crisis as a means of boosting credibility. Meanwhile, schools that have not added specific courses – Spain’s IE Business School, for example – market themselves as institutions in which ethics are woven into the fabric of all modules.
Other programs are aggressively promoting their shift in emphasis from bottom-line profitability toward a more holistic, stakeholder approach. This is even borne out by last year’s appointment of professor Nitin Nohria as dean of Harvard Business School. Nohria, an Indian national, has a background in corporate transformation and accountability, and sustainable economic and human performance.
Change in China
The same issues are also being discussed in the context of China. Access to international best practices, which are sometimes in conflict with Chinese approaches to business, will increasingly foster a culture of understanding among those involved. To this end, the country’s future business leaders are internationalizing themselves by attending business schools abroad and then returning home to work.
These ambitious Chinese, like their peers from other nations, want to get ahead in business, but not at the expense of communities and the environment. Shenzhen native Danny Bo Qin said he opted for Tuck Business School in New Hampshire, US, largely based on its ethical reputation.
“Tuck believes that business isn’t always about maximizing profitability,” Qin said.
“Faculty and students often partner with local businesses and non-profit organizations to advise them on issues of business sustainability and responsibility. This mission provides opportunities for MBA students to use their business knowledge to further the greater good of society. I wanted to be part of a community like that.”
With the new generation of business leaders navigating those paths, and with the help of the business schools that train them, there is hope that the errors of the recent past may not be repeated.
Ross Geraghty is managing editor of TopMBA.com and the Top MBA Career Guide.