The most prestigious B schools in the world obsessively pursue money. This ideological underpinning has led to the arsenal of junkbond-induced takeovers of the 1980s; the corporate accounting scandals of the 2000s; the outrageous increase in the pay gap between chief executives and workers; and even the real estate crash and the 2008 financial crisis. Just about every premise of this teaching model that dominates B schools’ curriculum needs to be punctured; and the sooner the better, before much damage is done. Beyond hypocrisy, this model misleads the public and its own business graduates about leadership. They say - all that matters is shareholder value, and the management’s sole duty is to maximize shareholder value. This idea has swept corporate America. We may choose to look the other way, but that is not the solution.
Some say, the schools have become detached from real-world issues. While we agree, elite B schools are the most intellectually stimulating places in academia. Yet, the loss extends far beyond the classrooms. Business graduates focus far too much on maximizing shareholder value and have a limited understanding of ethical and social considerations essential to the core of business leadership. B Schools need to gain a rebalance so business graduates devote overwhelmingly on not just the financial aspects of the business, but also on ‘prudence’. This requires an education in moral reasoning. Do we have time for that?
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