Many management students today are concerned about the mounting threats of climate change, income inequality, health care, and more. They increasingly see business as a place to make a difference in the world. Andrew Hoffman writes that business schools are slow to respond to students’ changing ideals, sticking to a heavy emphasis on 50-year-old notions of shareholder primacy and a “greed is good” mentality. He proposes a different business school model that emphasises management as a calling.

In my nearly 30 years of teaching in business school, I have seen a recent change in the kind of students that business schools draw. Today’s cohort still wants to learn the essentials of running successful businesses, but many are concerned about the mounting threats of climate change, income inequality, health care, and more. Increasing numbers are bringing with them a desire to make a difference in the world and see business as a place to do it. But business schools are slow to respond. Some critics call for a complete dismantling of the business school and the development of an “entirely new way of thinking about management, business and markets.”

While such a radical shift is a tall and perhaps necessary order, I propose another way to address the problem: helping students discern their calling or vocation in management. My idea is to involve the entire student in their education, inspiring their hearts as much as engaging their heads. If we do not create more rounded students with the skills to run effective business, an awareness of the ills facing our society and the role of the market in both causing, and solving them, we face a bleak future.

The challenge

A 2020 survey found that nearly 25 per cent of incoming business students wanted a job focused on social impact after graduating, and nearly 50 per cent wanted to do so later in their careers. At the same time, business ethics entered the top five most popular subjects in business for the first time. This builds on prior surveys that show that upwards of 90 per cent of business school students think that learning about social and environmental issues in business is a priority and two-thirds want a job that makes a social or environmental difference in the world.

Student attitudes mirror changes in the business environment, where many are reconsidering the state of the market and the role of business within it. Nobel Laureate Joseph Stiglitz warns that capitalism needs to be “saved from itself.” Paul Polman, former CEO of Unilever, calls capitalism a “damaged ideology” that “needs to be reinvented for the 21st century.” As a corrective, he and Andrew Winston advocate that companies must be “Net Positive,” playing an “active role in addressing our biggest shared challenges.” And taking up the charge, the Business Roundtable, World Economic Forum, BlackRock and others have begun to redefine the purpose of the corporation as not just serving the shareholder, but also “serves society at large . . . supports communities . . .pays its fair share of taxes . . . acts as a steward of the environmental and material universe for future generations.”

While there are questions around the veracity of such claims, the conversation has been engaged and today’s business students are eager to join it.

But business schools are not keeping up. While encouraging innovations in the elective curriculum can be seen, such as emerging courses with titles like “Reimagining Capitalism” at the Harvard Business School, “Economic Inequality” at the University of Virginia’s Darden School of Business, and “The End of Globalization” at Yale’s School of Management, the core curriculum, with a heavy emphasis on 50-year-old notions of shareholder primacy and a variant of the “greed is good” mentality, still prevails. Craig Smith, a professor at INSEAD, told the Financial Times that “students come in with a more rounded view of what managers are supposed to do but when they go out, they think it’s all about maximizing shareholder value.” One of my students once told me that she feels that her values are under attack every time she walks into the business school building.

Many students are increasingly making their desire for change known. In 2018, an MIT Sloan MBA student wrote a scathing review in The New Republic that the business curriculum stifles discussion of the common good while emphasising the overriding objective of profit maximisation as unquestioned. Rather than cultivating open-minded stewards of the economy, he writes, they are taught to ignore shareholder capitalism’s obvious ethical lapses and avoid any kind of systemic analysis of them. In a 2019 issue of American Affairs, a Harvard Business School graduate described an educational system that produces “a business elite dominated by financiers and their squires, presiding over a disordered economy gutted of both its productive energy and the ability to generate mass prosperity.” And in 2022, the Financial Times reported that upwards of 70 per cent of the Gen-Z cohort want course content that reflects the changes going on in society, from sustainability to poverty, diversity and inclusion. But this generation is frustrated as they want “business schools to ‘be the grown-ups’ and take a lead, rather than simply respond to student demands.”

One solution

There is no one solution to this dilemma. Revamping the business curriculum is a major undertaking, but a practical example exists, based on my book Management as a Calling, which inspired a program (with the same name as the book) at the University of Michigan’s Ross School of Business. The idea, rather than teaching management as simply a precise science, is to bring in a bit of the liberal arts. Rather than trying to “teach” ethics to fully grown adults, the goal should be to help students examine their own ethics and values, and rather than simply imparting knowledge, to help students develop wisdom.

Wise business leaders do not make decisions based solely on patterned information, regression analyses and p-values. Instead, they assess that knowledge and make decisions based on wisdom, character, judgment, and integrity. Many of the problems we face in today’s world are caused by applying knowledge without wisdom; “we act but we do not act wisely.” Developing the whole student, cultivating wisdom and character requires a set of aspirational principles that guide the business education and a process of discernment that connects them to the individual student’s own aspirations.

I propose that students be guided through a process of discernment, looking deep inside themselves to consider their career in management as a calling—moving away from the simple pursuit of private personal gain and towards a vocation that is based on a higher and more internally derived set of values about leading commerce and serving society. Rather than only asking “what career track gives me the most opportunity for professional development or to make money?” students may also ask “what pursuits will bring me closer to making a meaningful contribution to others in my business, my community and society?” “What kind of a future do I imagine and what role do I want to play in making it a future we all want to see?”

These are the questions that make a meaningful career, one that serves not just shareholders, but also society – employees, customers, the community, the natural environment, their children, and their grandchildren.

The endgame

In the end, there is a powerful need for change within business and within business education. Corporations play an outsized role in our modern world. Their actions, as much as the individuals that inhabit them, decide how we will live and adapt in a world that climate change, species extinction, income inequality and other social and environmental issues are altering. Corporations can, at their best, be vehicles of social progress and the solution to basic problems such as the provision of food, healthcare, education, equality, social progress and other human needs and wants or, at their worst, provide the tools to multiply the effects of the darkest of human impulses and result in exploitation, materialism and greed. To be the former, we need to cultivate a new kind of leader that sees the market in all its evolving potential.

The market—comprised of business, government, civil society, and others—is the most powerful set of organising institutions on Earth, and business is the most powerful entity within it. While government is critical to addressing our challenges, business must evolve to become a willing partner. People are demanding it; a 2017 survey by the Global Strategy Group found that 81 per cent of Americans want businesses to “take action to address important issues facing society.” With its enormous powers of ideation, production, and distribution, businesses will design the next buildings we live and work in, food we eat, clothes we wear, automobile we drive, source of energy that propels it, and the next form of mobility to replace it. Business can provide solutions at the scale we need them. But without visionary and service-oriented leaders, business will never even try to find them. Our students are ready to take on that challenge and a program for discerning a calling or vocation in management is one step in helping them along the way. Whether we respond is a choice that is ours to make. We will either be part of the solution and a force for constructive and aspirational change or a part of the problem by maintaining the status quo.

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Notes:

• This blog post is published as part of a series with SAGE’s Business and Management INK.
• The post represents the views of its author(s), not the position of LSE Business Review or the London School of Economics.
• Featured image by Caleb Woods on Unsplash
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