Can Ethics be Taught in Business School — Or Any School for That Matter?

Yesterday's Financial Times contains an article titled Class of '83 author recalls 'likeable' guy that took me back to my B-school days and begins as follows: "Nassim Nicholas Taleb, author of The Black Swan, got a shock when he opened the newspaper last weekend and saw a picture of an old classmate from Wharton business school at the University of Pennsylvania. I thought: 'What is this guy doing with the FBI?' Mr Taleb said of Raj Rajaratnam, the Galleon Group hedge fund manager charged last week with alleged insider trading."

According to the column "Another two of the six people charged last week were also in his class of 1983 cohort: Rajiv Goel, who ended up as a managing director at Intel, and Anil Kumar who became a director at McKinsey". Nassim is also quoted saying "Ethics courses as part of business degrees -- now the hot thing -- barely existed in those days. No one cared. But I don't believe that ethics can be taught in class'." I too was a grad student at Wharton at that time, and while I was not acquainted with these fellows, I couldn't agree more with Nassim's conclusion.

There was some debate in the 50's and 60's at the U of P among the professorial elite outside of the then "Wharton School of Finance and Commerce" surrounding the appropriateness of having a "trade school" within the Ivy walls. The gist of the argument was that "business education" was somehow beneath the caliber of the University of Pennsylvania and not consistent with its haughty educational standards and image. Perhaps they were onto something -- and I personally knew many older faculty members, now past on, who would just relish in the negative and embarrassing publicity that a number of Wharton Alums have bestowed upon the school -- but I digress.

It's curious to me that Wharton, along with other business schools, have taken it upon themselves to "teach ethics". The classes I had in accounting, finance, management, marketing, decision (computer) science, legal studies and organizational systems comprised a total immersion in how business functions and provided the foundation required to be successful in the world of business. That's it -- the pre-requisite knowledge to practice business at all levels.

What one does with this knowledge is beyond the purview of the institution teaching it. If Dr. Mengele's alma mater had included medical ethics in his training might he have turned out differently? Hardly. One's personal ethical behavior is the result of their cumulative experience. We all know the difference between right and wrong, legal and illegal. How we choose to act on that knowledge has nothing do with institutional learning -- even sociopaths know the difference between right and wrong, they just don't care about it.

A superior or even good business education arms its students with a powerful arsenal of knowledge that can be put to a variety of endeavors -- including the procurement and supply chain professions. Perhaps someday we'll be able to accurately test for and determine a person's moral character and preclude them from gaining knowledge that they can then take and wreak havoc on the world. Until that time, constant vigilance and continued IT development to monitor business activities and bring those who abuse their knowledge of systems for illegal personal motives to justice is our best, and only, recourse.

William Busch

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