Just three years ago, in the midst of the global economic implosion, a group of Harvard Business School students proposed a “Hippocratic Oath for Managers” to “transform the field of management into a true profession.” The MBA Oath attracted a good deal of publicity, including a story in The New York Times, and graduating students at many business schools signed the social contract to pledge that they would behave in an ethical fashion. Interest in the MBA Oath has since waned, but this week, The Harbus, the MBA student newspaper of Harvard Business School, published pro and con essays on the topic. The view opposing the Oath, “I’m Not Taking Any MBA Oaths And You Shouldn’t Either,” was written by second-year student Colin Barry is reprinted below. Writing “Why We Should Have an MBA Oath and Why We Should Take It” was classmate Will Clayton.
Over the past decade, the scions of the most celebrated business schools on the planet have presided over a glaring string of criminal misdeeds and macroeconomic catastrophes.
We at Harvard have tried to muster a response. We added a first-year course on how not to be a crook (Leadership and Corporate Accountability). We welcomed a bold new dean with a reputation as an ethics-focused educator. And in 2009, several of our alumni proposed that we take an MBA oath upon graduation.
MBAs must stop bleeding our world dry. But I think a professional oath for managers is a bad idea. The MBA Oath is flawed in design, inadequate in execution, and destined to fail.
Management is not the same as medicine or law.
Successful and enduring professional oaths — the Hippocratic Oath or the bar oaths for attorneys — are one piece of an elaborate system intended to prevent inexperienced neophytes from masquerading as members of a privileged guild. There is a clear social contract — we endow a select group of people with special trust and additional capabilities (the power to proscribe dangerous drugs, for physicians) in exchange for completing a rigorous, standardized apprenticeship.
MBAs have no exclusive mandate from society to do anything. You can be a Fortune 500 CEO without an MBA. There are no prohibitions against performing a discounted cash flow analysis without first obtaining an MBA. And there shouldn’t be.
Guilds hinder innovation and extract rents from society. We accept them in select professions because we think that maintaining a minimum standard of performance is incredibly important — too important to be left to the free market. That is not the case for the leaders of corporations.
We should not seek to create a guild of managers.
What happened to shareholders?
As written, the MBA Oath neatly sidesteps managers’ primary legal responsibility: to generate profits for a firm’s shareholders. The Oath exhorts managers only to create the more nebulous “value.”
I would be among the first to argue that short-term profit maximization cannot be the only duty of managers. But it is naive to encourage adherence to an professional oath that omits the very reason for our profession’s existence. Managers serve, first and foremost, at the behest of capital owners.
When the going gets tough, how seriously are you going to take an Oath that ignores this?
We’re not ready for this.
Doctors take a professional creed at the end of their formal education because we believe that their schooling will convince them that the Hippocratic Oath is important and meaningful. Even if they arrived in doubt of their duty to others, we think that the “transformative experience” of attending medical school will make doctors more enlightened people.
Most business schools don’t even pretend to buy this. And Harvard is no exception. The closest we come to dictating ethics to students is to bring in the U.S. Attorney from the Southern District of New York to discuss the lengthy prison sentences doled out for insider trading.
The very mission of Harvard Business School is remarkable in its ambivalence about the moral responsibility of its graduates. We proclaim that “we educate leaders who make a difference in the world,” but we will not be bold enough to stipulate that our graduates should make a difference for good.
Jeffrey Skilling, Rajat Gupta, Sam Barai, and Stan O’Neal? Mission accomplished.
Without the buy-in of the institutions that produce MBAs, an oath is doomed.
So, you should not be a crook when you leave this place. But you should also not take an ill-considered oath that seems more intended to white-wash the failures of our graduates than to lay the foundation for a more honest and just practice of business.
We don’t need an MBA guild.
This story is reprinted with permission from The Harbus, the MBA student newspaper of the Harvard Business School.