The MBA Oath: What Good is an MBA?
by Max Anderson
Posted: 15 Sep 2010
What good is an MBA? That is the question my uncle asked when I first started applying to business schools. Although it is the most popular graduate degree in the world (500,000 handed out each year), you do not need an MBA to succeed in business. So why take the time and pay the expense to earn the degree?
What good is an MBA? That is the question pundits began asking when the Global Financial Crisis hit. MBAs were packed into the firms that failed just as tightly as in the firms that survived. What good did their degree do them or their companies? In the opinion of many, the letters M.B.A. stand for "Mediocre But Arrogant." For a few they mean "Masters of the Business Apocalypse."
What good is an MBA? This is the question I asked myself as I prepared to graduate from Harvard Business School in 2009, at the low point of the recession. What had my classmates and I learned that would make us the kind of leaders who would not repeat the mistakes made by those who had gone before us? My answer: not enough.
In medical school, students gain scientific knowledge and technical skills to apply their profession. They also learn a professional ethic. Doctors have a responsibility to heal. They take an oath to publicly affirm their commitment to "do no harm." As a result, doctors develop a professional identity that affirms the importance that they do the right thing for their patients, not just the thing that will make the most money for them.
MBA students have no such governing code. Students gain knowledge and technical skills like building discounted cash flow models and pro forma financial statements. But in the vast majority of business schools, little or no thought is given to the idea that business leaders might need training in a similar ethic. Doctors have the Hippocratic Oath, but there has been no equivalent in the business world for managers to commit themselves to a higher professional standard.
Last year, as my classmates and I were graduating from business school, we created what has become known as the MBA Oath. It begins with the premise that our purpose was to lead people and manage resources to create value that no individual could create alone. It goes on to detail seven promises:
- I will manage my enterprise with loyalty and care, and will not advance my personal interests at the expense of my enterprise or society.
- I will understand and uphold, in letter and spirit, the laws and contracts governing my conduct and that of my enterprise.
- I will refrain from corruption, unfair competition, or business practices harmful to society.
- I will protect the human rights and dignity of all people affected by my enterprise, and I will oppose discrimination and exploitation.
- I will protect the right of future generations to advance their standard of living and enjoy a healthy planet.
- I will report the performance and risks of my enterprise accurately and honestly.
- I will invest in developing myself and others, helping the management profession continue to advance and create sustainable and inclusive prosperity.
Now this may all sound nice and pleasant, but will it make a difference? Words. Words. Words. What impact can we expect from thousands of young managers making promises about behaving ethically?
In other words, what good is an MBA Oath?
First, the oath is a framework. MBAs learn all manner of frameworks for strategy and marketing. This is a framework for decision-making. Before taking any action, a leader ought to think about these seven promises and ask whether they would be violating them through their action. That level of ethical reflection is too rare these days.
Second, the oath works under the theory that words actually matter. When someone testifies in court, they must swear to tell the truth. When two people get married, we make them vow to care for each other in sickness and in health. When someone wants to become a citizen, they must pledge allegiance to their new country. Why have people make these promises? Because deep down, we know they matter. Once you make a promise - to report the risks of your organization accurately - you might break the promise, but the odds of you keeping it are higher than if you had never made yourself accountable at all.
There is more work to be done. We are now in the process of giving the statement real teeth - by institutionalizing it in the world's top business schools, developing best practices for signers to keep the oath front of mind, and perhaps even requiring signers to complete continuing education requirements to maintain.
An oath alone, could never change business; but coupled with a strong education and community of practice, we believe it could change things for the better. Ten years from now, we hope that as a result it will be a lot easier to answer the question: what good is an MBA?
paul freedman - Posted: 11 Jan 2011
Silke - Posted: 21 May 2011
The opinions expressed in this article are those of the author, and do not necessarily represent the views of St Paul's Institute or St Paul's Cathedral.