Yesterday, MBA alumna Jashmin Shrestha sent a link to a current Forbes.com article entitled, “Are B-Schools to Blame?” Among other things, the article asks whether MBA programs and/or the firms that hire their graduates are culpable for the spate of corporate scandals and ethical lapses we’ve seen over the years.
Jashmin’s question: “your thoughts?” Here’s part 1.
When I started teaching at William and Mary in 1988, one of the then-“Big 8” accounting firms was so concerned about the ethical standards of new hires that they established a remarkably ambitious training program. Their goal was to bring faculty from every accredited business school in the nation to their headquarters, at company expense, to have world-renowned ethicists teach us ways to better incorporate ethics into our curricula. The firm? Arthur Andersen… the one that went down for obstruction of justice in the Enron scandal in 2002.
How could such an organization be brought so low? It’s easy to point to a few bad apples in a great firm, but I’ll bet the folks who ordered the shredding of Enron documents couldn’t have envisioned themselves as “justice obstructers” just a few years earlier. I’d make the same bet on the principals in other major scandals, right up to today. I doubt Bernie Madoff ever aspired to be what Bernie Madoff became.
Alex Gibney, Director of the film ENRON: The Smartest Guys in the Room, said this about his experience with the Enron project:
I became somewhat sympathetic about some aspects of some of the people from Enron—even some of the higher-ups. I don’t think they started out running a scam; they fell into it, incrementally.
He also said this:
I am interested in self-deception: how human beings find ways to deceive themselves that they are, in the words of [former Enron CEO] Jeff Skilling, on the ‘side of the angels,’ when, in fact, they are working for the man with the pitchfork and the pointy tail.
How and why does this happen? Big, dramatic changes in values are rare. Folks don’t suddenly “go bad” (or good), but that doesn’t mean that values are locked in stone. One’s cultural environment can ultimately have an edifying or corrosive effect on the values we arrive with. With that in mind, one task for business schools and employers is to create edifying environments that nurture our noblest instincts. The other task is to “rust-proof” ourselves against the corrosive environments that we will encounter.
There’s a large body of work in social psychology that sheds light on all this, but we’ll get to that in the next blog. For a great read on the social psych stuff, check out Influence: Science and Practice (5th Ed), Robert Cialdini.
Jim Olver
Jim.Olver@mason.wm.edu
