For decades, the business of Master of Business Administration (MBA) programs was strictly business. The requisite finance, accounting and marketing classes dominated curricula as most business schools eschewed discussing ethics and social change. After all, most of these programs had taken the Milton Friedman approach to commerce, as in insisting that companies stick to what they do best: maximizing profits and shareholder value. Friedman did add a caveat to his belief that the pursuit of profits could be pursued “so long as it stays within the rules of the game” – in other words, respect the law. The bottom line for Friedman, however, was that it was up to other institutions to pursue social good.
The past year, however, has proven that it has been business far beyond unusual. And more business schools are realizing that if their students will be engaged and able to thrive in this new reality, then MBA programs must prepare their students for this brave new world.
“As topics like sexual harassment dominate the national conversation and chief executives weigh in on the ethical and social issues of the day,” David Gelles and Claire Cain Miller wrote for the New York Times earlier this week, “business schools around the country are hastily reshaping their [curricula] with case studies ripped straight from the headlines.”
To some critics of the business community, this shift towards more of an emphasis on business ethics has been far too slow, akin to the Titanic trying to change course with the iceberg already in view. Only a few years ago, Bloomberg pointed out that business schools were failing to help foster a more ethical business climate, noting the dozens of top companies that had afoul of laws such as the U.S. Foreign Corrupt Practices Act. Meanwhile, many of these programs have struggled to recruit women to apply to their programs, adding to what many critics say is the lack of diversity within top companies’ c-suites and boards of directors.
A change, however, is underway. Megan Kamerick of Fast Company has pointed out that top business schools, such as at University of Pennsylvania and Columbia University, now require students to take courses on corporate responsibility either as part of their curricula or for orientation.
Much of this evolution has been driven by students themselves. We have known for several years that the younger generation of workers entering the labor market prefer to work for companies that are more responsible and have embarked upon some level of social purpose. And now these future managers want those conversations about ethics and a more inclusive workplace to unfold in the classroom.
This is quite a contrast from even a decade ago, when most business schools – including the program from which I graduated – still limited their curricula to economic theory and case studies. Topics included the classic business cases: Walmart under Sam Walton zooming in on small towns for the opening of new stores, while Kmart only focused on the suburbs; Zara and its parent company, Inditex, harnessing technology to revamp its supply chain; and companies like Arm & Hammer finding new product and business adjacencies.
Now, as the Times profile showcased, current news headlines generate course content for newly minted MBAs. Controversial issues such as dissecting the “bro culture” at the likes of Uber and other Silicon Valley companies, recent NFL protests, the violence last summer in Charlottesville and businesses’ response to it – as well as the #MeToo movement and its role in ensuring a more welcoming workplace – are included in more business schools’ course listings.
Traditionalists may wince at the thought of any graduate-level business course becoming more issues-oriented, but we live in an era in which stakeholders can and will brandish tools such as social media to keep companies accountable. And this business world in which we live and work means that the new challenges businesses face cannot be simply be a can kicked down the road to human resources, communications or legal. All of us have to be a part of the solution, and business schools are wise to prepare their students for this new wave of challenges that will flare up at any time.
Image credit: WestcoastivieS (Wiki Commons)