How to Identify MBA Programs That Emphasize Business Ethics

Business executives are often required to make tough choices with moral implications, including decisions about layoffs, employee compensation and corporate restructurings. These executives are sometimes faced with situations where, no matter which option they take, they will make somebody unhappy. That’s why lessons on how to be a fair and compassionate leader and how to navigate difficult judgment calls are essential for a well-rounded MBA curriculum, business school professors say.

“Each and every business school applicant will face ethical dilemmas throughout their career,” Robert Föehl, an executive-in-residence at Ohio University College of Business who teaches business law and business ethics courses, wrote in an email. “It’s a given. And these situations are uncomfortable and stressful, with many of the corresponding decisions having significant ramifications for one’s career, family and livelihood.”

[Read: 4 Things Social Entrepreneurs Need in a B-School.]

Föehl advises MBA applicants to evaluate the ethics coursework provided at the business schools they are interested in to see if the schools provide adequate training in this area. “The first step is to identify whether the MBA program requires a course in business ethics at all,” he says. “After all, some business schools haven’t placed a high value on educating students to be the principled leaders that businesses need.”

Brandon Peele, an alumnus of Columbia Business School and author of “Planet On Purpose,” a book that focuses on ethical leadership, says that a B-school that excels in teaching ethics allows students to define their personal values.

If students do not commit to their own ethical principles during their MBA program, there is a risk that they will make ethical mistakes later as they pursue high-stress business leadership positions, Peele says.

Peele warns that sometimes business professionals make moral compromises that don’t align with their values. He suggests MBA ethics classes that encourage students to discover their personal identity, express their vision for the world and decide what type of leader they want to become generally have “more teeth [and] more staying power” than courses that focus purely on ethics theory.

Experts say a solid business school ethics curriculum will include case studies based on real-life dilemmas that business executives have faced and opportunities for students to debate and discuss ethics. According to experts, courses in business disciplines where there is a high risk of ethical malfeasance, such as accounting or investing, ought to include a discussion of the temptations toward unethical behavior that exist within those disciplines.

“Students need to ask if ethics is integrated into all classes,” Scott MacDonald, the director of the MBA program at the University of Dayton’s School of Business Administration, wrote in an email. “Does the curriculum integrate ethics into finance, marketing, operations etc. or does the program just offer a stand-alone ethics class? How ingrained is ethics in the DNA of the school?”

Leigh Hafrey, a senior lecturer at the Massachusetts Institute of Technology Sloan School of Management who teaches courses on professional ethics, says discussion-based ethics courses are particularly valuable. “I have attended many very good lectures on ethics, and that certainly qualifies as a legitimate method to convey ethics instruction, but I do think that the opportunity to participate in the conversation makes a huge difference,” Hafrey says. “It gives the student ownership … and invites them to take an active stance on issues of major concern to all of us and the organizations in which we work.”

[See: 10 Ingredients of a Strong MBA Resume.]

Hafrey says he uses fictional scenarios depicted in novels or films as a jumping-off point for discussions about moral values in business. “I would argue that if you pick the right stories, you get a richness and a complexity that textbooks don’t often provide, and that’s really the goal,” Hafrey says. He adds that one of the benefits of discussing fiction in MBA ethics classes is that it can illustrate the way that business fits into society as a whole.

Another advantage of this approach is that it shows MBA students how to find moral lessons in fiction and how to use that knowledge to inform their quest for a good life. “It sets the standard, it seems to me, for continuous learning, and that matters,” Hafrey says.

Maura Herson, assistant dean of the MBA program at MIT, says that frequent dialogue about business morality questions is one of the key signs that an MBA program takes ethics seriously. “Values vary. It’s not like there’s one set of right and one set of wrong, and so being able to have open discussions is important,” she says.

Herson adds that a top business school will usually incorporate current events into its lessons about business ethics, including information about controversial subjects. For example, a top MBA program might lead debates about the morality of privacy policies at prominent technology companies like Google and Facebook. Herson says it’s ideal if a business school offers elective ethics courses that focus on the moral dilemmas that are specific to particular industries or job functions, such as a course on the ethics of supply chain management.

“Any classroom where the professor doesn’t want to touch the ethics issue — that would be a red flag,” she says.

MacDonald says it’s important to investigate whether the case studies in an MBA curriculum focus solely on grave ethical mistakes or also address smaller lapses in judgment, which are more common in business. “Really good programs don’t just bring in cases where it’s real simple to say, ‘Oh, they were bad or they were good,'” he says. “You really need to make it murky, because that’s how the world is.”

Bernice Ledbetter, a faculty member at Pepperdine University’s Graziadio Business School and the chair and academic director of its M.S. in management and leadership program, says that business ethics is ideally taught using multiple methods, including both traditional case studies and other tools. Ledbetter says that in her courses, she not only uses fiction literature, but also includes nonfiction documentaries. She also leads a workshop called “Developing Your Moral Compass,” which requires students to fill out a worksheet where they describe what type of personal character and professional reputation they’re aiming for.

Ledbetter argues that all MBA students should be required to study ethics as part of their MBA program. “As someone who teaches this area, I think that we do ourselves a disservice if we make it optional, because it just conveys a message that ethics is optional, and I just can’t abide by that, quite frankly,” she says.

She says one sign that a school takes ethics seriously is when it offers opportunities for MBA students to use their business knowledge to help their community. Ledbetter notes that at her school, MBA students are able to complete consulting projects for nonprofit organizations, and students with expertise in entrepreneurship may participate in a mentoring program for homeless individuals who want to start a business.

Another positive sign, she says, is when a business school offers a course in “leadership ethics,” a discipline which focuses on how an aspiring leader can strengthen personal character and what a principled decision-making process looks like.

Jeff Stolle, a senior instructor of management at the Lundquist College of Business at the University of Oregon, says that an MBA ethics curriculum needs to include a primer in business law, so that MBA students know about legal rules on ethics in business, but that a class in business law is not sufficient for a good business ethics curriculum.

“As important as a law class is, if a school only had a law class and considered that to be sufficient ethics training, I would consider that to be a red flag. … It would be reducing ethics to the law. It would essentially be the position that, as long as you’re acting legally, you’re acting ethically, and I think that’s a very dangerous assumption,” Stolle says.

[Read: Find an MBA Program That Teaches Real-World Skills.]

Experts say that MBA programs that excel in ethics typically offer courses on how to create and maintain profitable business ventures with a positive social impact, a practice which is known as social entrepreneurship. Michal Strahilevitz, who teaches business courses at the University of Wollongong in Australia, explains that leading MBA programs usually offer courses in corporate social responsibility or sustainability.

“The focus … in such classes is doing well by doing good. It is a win-win as ethics and caring about social impact can in fact translate into profits,” she wrote via email.

Searching for a business school? Get our complete rankings of Best Business Schools.

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