“You don’t understand the full impact that business and business leaders can have on the world stage until you start discussing issues of this magnitude,” says Lewin. “It was not easy to talk about emotionally–we were wrangling with some tough issues. I think it kind of surprised all of us.”
With corporate scandals and billion-dollar bankruptcies dominating headlines for more than a year, ethics has become almost a hotter topic than earnings on business-school campuses. Corporate icons like Enron’s former chairman Kenneth Lay (who now faces a multi-million-dollar lawsuit filed by the company’s creditors) and domestic diva Martha Stewart (under federal investigation for possible insider trading) were once held up in classrooms across the country as examples of successful business leaders. Now they have re-emerged as subjects of corporate case studies in what not to do.
Business schools have offered elective courses or included ethics-related case studies in other courses for years. But many are now asking whether they’re doing an adequate job at preparing future business leaders to handle ethical dilemmas. They’re adding new courses on ethics and corporate responsibility, inviting business leaders to lecture on the topic, even requiring students to address the issue in their applications. “You’ve got to step back and say ‘Why did this happen?’” says Rick Shreve, who teaches business ethics at Dartmouth’s Tuck School of Business, about the recent scandals. “Then you get around to the question of what business schools are doing about ethics. A lot of people ask what we’re doing and expect an answer in terms of how many class hours we’re devoting to it. But what they’re really asking is ‘How are you shaping the characters of the future business leaders of the 21st century?’”
At Harvard, MBA students have been required for a decade to take a first-semester course called “Leadership, Values and Decision Making.” Last semester, the school added a new second-term ethics course to the curriculum as well, tentatively called “Leadership, Values and Corporate Accountability.” “Our commitment to educate business leaders who have ethical values hasn’t changed, but the society out of which our students come has changed,” says Kim Clark, dean of the Harvard Business School, which has come under more scrutiny because of the prominent roles played by some of the school’s alumni in recent corporate scandals. (Former Enron CEO Jeff Skilling is a Harvard Business School graduate).
The University of Maryland’s Robert Smith School of Business takes a hard-core approach to teaching ethics. All of the school’s MBA students are required to participate in a field trip to a minimum-security prison, where they come face-to-face with former corporate executives now doing time for white-collar crimes. “Students find it pretty memorable,” says Stephen Loeb, who teaches accounting and business ethics at the school. “They talk to prisoners who were once executives but made errors, and they see how they would live if they made a mistake.”
About 1,500 students have gone through the program since it began a half-dozen years ago. Now the Haas School of Business at the University of California, Berkeley, is making plans to add a similar program (California’s Pepperdine University already has one in place).
Some schools are asking big names from business to help them teach the topic–including those made famous–by the corporate scandals of the past year. Berkeley invited Enron whistle-blower Sherron Watkins. At the University of Michigan Business School, General Electric’s Jeff Immelt and Steelcase’s Jim Hackett helped conduct workshops in business ethics and social responsibility.
There is little question that students now think the topic is an important one. Eighty-four percent of college students say the United States faces a “business-ethics crisis,” according to a national survey by Students in Free Enterprise (SIFE) of more than 1,100 U.S. college students taken last fall. “When you talked about ethics in or out of class, there used to be a show-me-why-this-is-important-to-me attitude,” says Lori Tansey Martens, president of the International Business Ethics Institute in Washington. “Now students are on the edge of their seats.”
Still, ensuring that business ethics will stick in students’ minds and in school curriculums once the topic fades from the headlines will be a challenge. “Unfortunately, what often happens is that when we have large problems everyone gets interested and then, as time goes on, the interest tends to dissipate. We’ve had crises like these before,” says the University of Maryland’s Loeb. There are signs the shift is permanent: The Association to Advance Collegiate Schools of Business (AACSB), the nation’s accrediting body for business schools, will vote in April on a revised set of standards that strongly emphasizes ethics–citing it specifically in three out of eight “assurance of learning” standards. “If these scandals hadn’t happened, would we have reflected these ethics standards so prominently? It’s impossible to know,” says Carolyn Y. Woo, dean of the Notre Dame Mendoza College of Business and chair-elect of the AACSB International. “But we consider ethics to be very important.”
So do students like Lewin. Now a member of Harvard’s “Leadership and Values” initiative, a student group that helps develop ethics-related programs outside of the classroom, including guest lectures and roundtable discussions, Lewin was chosen to deliver a speech to the incoming class last fall. She devoted much of it to the subject of ethics, encouraging new students to “use the classroom as an opportunity to take risks, to refine your ability to weigh all the inputs and make credible decisions under tense conditions … and to discern for yourself, using your own moral compass, what the right course is.”
Now just a few months from graduation and a new job, Lewin says business schools may not be able to teach students morality per se but are able to provide the tools to help students like her “recognize ethical dilemmas and … make the right choice.”
“If a business school is serious about fulfilling its mission to train leaders,” she says, “I don’t know how it can execute that properly without including what is a huge component of business: managing ethically and responsibly.”
