by Max Anderson and Peter Escher (Portfolio Hardcover, 2010. 288 pp)
Max Anderson, a 2009 graduate of Harvard Business School, also graduated from the Harvard University's Kennedy School of Government and from Princeton University. Anderson is a senior management associate at Bridgewater Associates.
Peter Escher, a 2009 graduate of Harvard Business School, also attended the University of Washington. He is an investment analyst at Liberty Mutual.
Book review by Cindy Strong
An Array of Assertions
A quick reading of websites of a few business schools in the country reveals an interesting array of promises and statements.
Harvard asserts that they "educate leaders who make a difference in the world." Thunderbird School of Global Management posits that they are "educating global leaders who create sustainable prosperity worldwide." Interestingly, Thunderbird has an "Oath of Honor" that all students sign and recite, pledging "to uphold ethical and sustainable standards in business."
Wharton School of Business lays claim to "advancing business, advancing society" on their site. Stanford Graduate School of Business states that their mission is to "develop innovative, principled, and insightful leaders who change the world." The focus of Columbia Business School is "To better train students to recognize and capture opportunity in a world where disciplines intersect and industries change rapidly."
With so many assertions, one might ask, what is the reason for acquiring a master of business administration (MBA)?
"Darth Vaders of the Business World"
Max Anderson and Peter Escher, in their book The MBA Oath, seek to elicit a conversation on just this question. As the title alludes, this book is a challenge to all those involved in the educational endeavor of obtaining an MBA degree — faculty and students alike. More specifically, the authors seek to explain the purpose of MBA education and the rationale for the MBA Oath initiative. They also assert generally that they wish to "provoke an examination" of the ethics of business.
In the wake of the financial crisis of 2008, Anderson and Escher claim public opinion of business, business leaders, and MBA graduates has dipped to record lows. Frustrated and embarrassed by being viewed as "the Darth Vaders of the business world," Anderson and Escher (as new MBA graduates) began asking how such a perception could be changed. They sought discussion on how to change both the education and practice of business managers so that the managers would seek to do more than focus on the maximization of profits.
Maximize Value(s), Not Profits
The authors begin the book with the actual MBA Oath, which is now translated into five languages and has been signed by more than 4,500 people.
Part I of the book details a grim overview of the questionable state of business school education and business in general. After making the case that the general perception of people is that all business is debased, the authors delve into a rationale and an explanation for the need for an oath. Fashioned on the model of the Hippocratic Oath, the MBA Oath is a collaborative initiative spearheaded by Anderson, Escher, and Harvard professors Rakesh Khurana and Nitin Nohria.
The Oath has MBA graduates sign a statement pledging that, when they are managers, their purpose will be to serve the greater good. Sprinkled with numerous mini-case studies, statistics, biblical allusions, and a plethora of anecdotal accounts of business successes and failures, Anderson and Escher argue for a higher calling in business. They describe reasons for returning to the principles espoused by early graduate schools of business, to train "business leaders to manage organizations … both for their shareholders and for the benefit of society."
Part II is dedicated to a more detailed explanation of the principles underlying the MBA Oath. Each chapter applies one principle to the case studies and anecdotal stories of business dealings the authors encountered during their MBA education. They dedicate an entire chapter to laying out the objective of management, which is to "bring together people and resources to create long-term societal value."
Additionally, they contend, the mission of business is to maximize value, not profits. They conclude Part II by addressing the final section of the MBA Oath, which is a promise of accountability to one's peers. They detail the essential nature of accountability and how the MBA Oath can be a tool to facilitate this sort of behavior.
Important Questions, But …
Despite the employment of occasional gross generalizations, dualistic thinking, and bullet-point writing, the authors ask important questions and offer the beginnings of a helpful critique of the endeavor of business and business education.
While they argue for a higher standard for business leaders and that the purpose of business is to "create societal value that no individual can do alone," their argument left me wanting a more nuanced discussion of the underlying reason for why business is important. Their thesis sent me digging deeper for a rationale of why the Smithean-inspired manager should and can "morally do better than a mere enlightened self-interest" (see George Bragues in the Journal of Business Ethics, p. 460).
In Need of a Deeper "Why"
A few years ago, I had the opportunity to hear a particular pastor preach regularly. With excellent Ivy-League training and a keen mind, he always took great care with sermon preparation. While he preached a well-crafted and thoughtful sermon, he often left out the foundational core of the gospel message. I frequently left church feeling unfulfilled and wanting more … I felt as if I had received an incomplete message.
The MBA Oath left me in a similar situation. While the authors have an excellent idea and have crafted a helpful essay, their argument does not go far enough. Yes, we need to be thinking about how to act more ethically in our business dealings. Maybe business schools do need to revamp the principles underlying the acquisition of an MBA. An oath might help.
But without understanding the deeper question of why it matters if we act ethically, without understanding the moral grounding we find, for example, in the Christian Scriptures, is this really possible? Will people really be compelled to act more ethically and responsibly by signing the MBA Oath?
Cindy Strong is the liaison librarian for the School of Business and Economics at Seattle Pacific University.