This week, Nitin Nohria, 48, was named dean of the Harvard Business School. At a time where MBA has come to stand for “masters of the business apocalypse” this is an important show of support for an ethics-focused approach to capitalism.
Nohria, a professor of business administration, has been a proponent of the MBA Oath, a voluntary pledge for graduating MBAs and business leaders to return to old-fashioned business ethics and core virtues like stewardship and responsibility. It’s also good timing for Max Anderson and Peter Escher, whose book, The MBA Oath: Setting a Higher Standard for Business Leaders, came out last week.
Anderson and Escher are recent Harvard MBAs who, along with the help of Prof. Nohria and others, created this businessperson’s Hippocratic oath in the months leading up to their 2009 graduation. Read the full oath here. In essence, it calls on business leaders to be “stewards of a trust to create value responsibly” - while also making money. Business schools contribute to the Great Forgetfulness of who you are and what you stand for, the authors worry. And while the number of ethics courses have increased five-fold at b-schools nationwide, they are still marginalized.
Business should be a friend, not an enemy, of progress. Indeed, capitalism would be strengthened if business leaders were focused on sustainable prosperity, the authors argue. It doesn’t mean less of a focus on making money. It just means making money honestly–by earning it as you earn the trust and respect of your consumers.
While most Americans will agree with this, the few vocal detractors call the MBA Oath an “impotent, misguided gesture” that “invites violation of fiduciary responsibilities” to create maximum profit for shareholders.
I disagree: As children, we are taught to tell the truth–even as we get mixed messages about what honestly really means from adults around us. We are taught to work hard and “do the right thing.” As adults, it’s important to be reminded of those values that we were socialized with, but may have forgotten. The best self-help books - like M. Scott Peck, The Road Less Traveled and Stephen Covey’s The 7 Habits of Highly Effective People do this for our personal lives. The MBA Oath can help business leaders remember these core values in their professional lives.
The bulk of the book is devoted to explaining and rationalizing the MBA Oath’s core principles–and the psychology behind why a simple pledge, made with a group of peers, can help frame decision-making in a better way. Indeed, one of the more psychologically astute points Anderson and Escher make is that those interested in signing the oath should do so with their peers, as a way to establish accountability, spread the word and create new norms of behavior.
There are two ways that social attitudes change: Either people change their minds (which is rare) or a new generation comes into power. The MBA Oath is a very Millennial-generation concept. There’s an idealism to it that we haven’t seen in decades. Let’s hope that young go-getters in their 20s and 30s get on board and sign this oath. Just think of how things might have been different if their predecessors had.
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