Warren A. Law (MBA ’48, Ph.D. ’53), the Edmund Cogswell Converse Professor of Finance and Banking Emeritus at Harvard Business School (HBS) and an eloquent critic of the corporate takeovers that convulsed the world of American business in the 1970s and 1980s, died of cancer on Thursday, Dec. 11, at his home in Belmont, Mass. He was 79 years old.
“Warren Law was an extraordinary person and teacher whose research was close to practice in the best tradition of the School and whose kindness, caring, and wit made him very special in the hearts of students and colleagues alike,” said HBS Dean Kim B. Clark.
Law joined the Harvard Business School (HBS) faculty in 1958 and quickly became known for his wide range of knowledge, his adaptability as a teacher and scholar, and his unconventional views about the changing landscape of the corporate world during an era of junk bonds and leveraged buyouts. In a 1986 Harvard Business Review article titled “A Corporation Is More Than Its Stock,” for example, he urged caution in the midst of a multitude of mergers and acquisitions, asserting that neither enhancement of shareholder wealth nor replacement of inept management justified hostile takeovers.
Targeted companies were rarely managed poorly, Law argued, and shareholders of acquiring companies gained little from such deals. “Only time will tell what this all means for society, and even then a conclusion may be elusive,” he wrote in the HBR article. “A ‘now generation’ of portfolio managers has emerged who, under pressure to outperform their counterparts each quarter, look for near-instant results from their investments.”
During a teaching career at HBS that spanned more than thirty years, Law taught in all of the School’s academic programs and played a key role in developing its international outreach, doing field research on multinational corporations and teaching top international managers in HBS Executive Education programs both at Harvard Business School and in more than twenty countries.
He responded nimbly to the School’s need to develop new academic courses that reflected changing practices in the business world. “If Warren were a baseball player, he’d win the MVP award,” once observed longtime friend and colleague Charles M. Williams, the School’s George Gund Professor of Commercial Banking Emeritus. “He can play a lot of positions very well.”
Law taught international business and entrepreneurial finance in the MBA Program, for example, and from 1974 to 1978 he chaired the School’s Program for Management Development, an executive education program that prepares high-potential functional managers and other professional specialists for successful career transition into general management roles.
He also wrote extensively on economics and finance. Both inside and outside the classroom, he was known for his clarity in explaining even the most complex topics. He retired from the active faculty in 1990.
Law received numerous honors during his career, including Harvard Business School’s 1996 Distinguished Service Award. In 1992, some eighty executives, academics, and government officials gathered at HBS to honor Law in a colloquium titled “Managing the Financial Services Firm in a Global Environment.” By one participant’s estimate, that group was responsible for the management of more than $1 trillion in assets. Jacob H. Schiff Professor of Investment Banking Emeritus Samuel L. Hayes III, a former student and colleague of Law’s, organized the event.
“Warren was a first-rate economist, and over the years he was often prescient in his views on where the U.S. economy was headed,” Hayes recalled. “Yet with his self-deprecating manner, he was never one to blow his own horn.”
Referring to Law as “one of the most gifted teachers” he had ever known, Hayes added, “Although Warren excelled at teaching by the case method, he was also an excellent speaker in all kinds of forums. He was famous for a sense of humor and wry delivery that reminded people of Will Rogers at his best.”
Law did not restrict his remarks to banking and finance. An early opponent of the Vietnam War, he participated in a peace march in 1969 and warned about the war’s domestic consequences.
Warren Aubrey Law was born in Dallas on April 16, 1924. His family lived in a small four-room house “on an unpaved street in a very poor neighborhood,” he remembered in a 1996 interview. “But I have fond memories of a happy childhood in what was then a small town–a place where you took your shoes off on the last day of school and put them back on when school started again.”
Starting school at age four, he showed his prowess as a student early, skipping a grade in elementary school and enrolling at Southern Methodist University (SMU) when he was fifteen. During his senior year in 1942, Law, then only eighteen, was recruited by Harvard Business School, which had decided to accept college seniors since its normal applicant pool of college graduates had gone off to fight World War II. By December, however, the School had dedicated itself to training members of the military, so Law returned home after completing just the first semester.
“It is quite possible that I was the youngest student who ever attended Harvard Business School,” Law once noted.
Completing his undergraduate degree at SMU, he served for three years in the Pacific as one of the youngest officers in the U.S. Navy. He returned to HBS on the GI Bill in 1947 and graduated the following year.
While home in Dallas for the holidays, Law ran into an SMU professor, who mentioned the need for teachers to work with veterans pouring into that university. “He told me I could teach beginning economics while I looked for a permanent job,” Law recalled. But he found he liked being in the classroom and returned to Harvard University shortly thereafter, earning his Ph.D. in economics in 1953. He then taught five more years at SMU, working simultaneously at the First National Bank in Dallas during three of those years.
Law’s career might have taken a different turn at that point, if J. Keith Butters, now the Thomas D. Casserly Jr. Professor of Business Administration Emeritus, hadn’t stepped in. In 1958 Law had answered a want ad for a corporate economist at the Atlantic Refining Company and given Butters as a reference. Instead, Butters invited him to return to HBS to teach macroeconomics. Years later, reflecting on “the happy set of accidents” that led him to the School for good, Law focused on his love of teaching. “HBS is a wonderful place to have a career for many reasons,” he said. “But the greatest reward for a faculty member is the students. They’re bright, motivated, and fun. It’s been a delightful experience.”
Law is survived by his wife of 53 years, Betty Lewis Law of Belmont, and two daughters, Elizabeth Law of New York City and Amy Law of Boston. A memorial service was held at Harvard Business School (Williams Room, Spangler Center) on Wednesday, December 17.