Do business schools need to change?

The Sunday 3/15 New York Times had an interesting article entitled “Is It Time to Retrain B-Schools?” Given the long list of MBAs running now bankrupt or dysfunctional organizations and their collective impact on the economy, the article asks experts to comment on whether schools are really doing their job. Essentially asking, “what purpose do they serve?”

Ideas such as a formal code of conduct  for business professionals (like in accounting – that worked out well for Arthur Andersen!) are batted around. Much of the critique focuses on overemphasizing training for technical skills rather than for “judgment”. It is observed that at many schools, ethics is treated as a separate subject rather than something woven through the entire curriculum.

Frankly, I think there are normal generational shifts that drive some of the behaviors described. Graduates reflect their times as much or more as they do their institutions. The current millenial students I teach are quite idealistic and focused on social responsibility. Sometimes to a fault (eg: even a non-profit doing good needs to economically viable).

Our curriculum here at the Carlson School really tries to weave in ethics and CSR from freshman year. As one example, our introductory management course spends as much time on ethics and corporate social responsibility as it does on strategy. We have lively debates over Friedman’s view on shareholder supremecy contrasted with stakeholder theory. Additionally, in my Consulting Enterprise program we try to always model best practices in ethical behavior. A minor, but common “slippery slope” type ethical dilemma is how you represent yourself when doing research.  Clients will occasionally ask us to represent ourselves as students working on a class project.  Clearly this isn’t ethical when we are working on behalf of a client, so we simply won’t do it.

My feeling is that it’s important to develop in our students a sense of judgment, rather than try to “teach” them ethics.  I often comment to my students that many phenomena (like politics) simply are. They exist. If you don’t like politics, then don’t join organizations. If you’re in one then you’ll be dealing with people’s goals, drives and motivations. Having said that, there are “good” politics and “bad” politics. The first advances important agendas and builds things for some common good. The latter aggrandizes personal fiefdoms and enriches its practioners at others’ expense.

I also think it’s a bit much to blame b-schools when the broader culture is so overtly corrupt. I’m no apologist for senior execs who took ridiculous compensation or the boards who overpaid them. It’s unconscionable for publicly taded organizations in my opinion. However, any politician casting a stone is absurd. Republicans, Democrats, legislators, regulators…everyone was in on it. Money flowed freely all over keeping the wheels of commerce turning. To expect an individual executive to stand against the entire system is a lot to ask. That would be a noble person. You can’t expect large numbers of people to do the right thing when there is huge upsayde and little or no downside to unethical behavior.

I think the best we can do as institutions is challenge students to confront these realities and begin to think through where they stand while giving them some tools to frame their thinking.  In the end, they won’t know what they’ll really do until posed with an actual moral dilemma.

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One Response to Do business schools need to change?

  1. The typical argument from idealists (I’ve met a few MPP or MUrP’s in this category) is that the private sector is populated with people who have no conscience, or those that do have had it withered and worn down as a stone to the tide long ago. I think they’re wrong.

    Business and “ethics” are not mutually exclusive ideas. As you stated, any organization has to be economically feasible and to do so must be able to turn a profit for existence in the future. But is that in itself “ethical”? And if so why? Is making money ethical? I’d argue that it’s for the betterment of society, yet there are corollary casualties as well. What we think is relatively ethical is still based on a relative surplus value. But is that “ethical”?

    I think ethics as a term is incredibly loose and difficult to wrap your arms around. We all have an idea of what it is, but the real parameters are lost in that aforementioned ocean. We all navigate relatively safely for lighthouses of humanitarian mores, but I still find the term too vague and overused.

    Really good post.

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