The MBA Oath is an opportunity to reassert the purpose of the business profession. By establishing a code of conduct that grounds the profession in a responsible value creation philosophy, my hope is that business leaders will move beyond their myopic focus on shareholder maximization. Analogous to the evolution of the legal and medical professions, MBA students and business practitioners must act in order to restore credibility and continue to create long-term value for all stakeholders.
Based upon my career experiences as a manager at Hewlett-Packard, I wholeheartedly believe in the business adage that “doing well and doing good are not mutually exclusive.” While certain companies view commitments to societal objectives as simply branding or philanthropy, HP has traditionally emphasized a commitment to community and employees as an element of corporate social responsibility as well as a way to strategically protect and grow business over time.
I believe that executive and managerial adherence to a code of conduct and a commitment to society that goes beyond a myopic focus on quarterly results and short-term shareholder profit maximization is not only good corporate citizenship but also sound business strategy. I view the MBA Oath as a means to promulgate this philosophy.
The MBA degree is on the brink of becoming a commodity (thousands of MBA programs exist-571 of them are accredited) and the credibility of the degree is under question. Lessons about the negative consequences of groupthink and the importance of empowering the individual contributor and mid-level manager are evident in the failures of well-publicized corporate governance structures from Enron to Washington Mutual to Worldcom. As MBA students and future business leaders, we have an opportunity to promote a higher standard aimed at professionalizing business and ensuring a purpose rooted in responsible long-term value creation not simply short-term value extraction. The efficacy of this standard will be determined by the number of business leaders, grounded in a sense of purpose, who view profit as a means to an end while being committed to a long-term vision of business performance.
The professions of law and medicine were confronted with similar challenges at certain points in their evolution. Legal and medical practitioners and scholars alike rose to this challenge by seizing the opportunity to safeguard the credibility of their respective professions and carve out a sense of purpose through codes of conduct and ethical standards that society now takes for granted in the form of the Hippocratic Oath and the American Bar Association’s Model Code of Professional Responsibility. While doctors have committed to “do no harm,” as stated in the first tenet of the Hippocratic Oath, and lawyers are required to “inform the appropriate professional authority when they know another lawyer has.violated the Rules of Professional Conduct,” the business community has yet to commit to baseline expectations of professional conduct. Our time to imbue the MBA accreditation process with a minimum ethical standard and proudly commit to protecting the credibility of our profession is now!
To be clear, I do not view the MBA Oath as a panacea that will, in and of itself, resolve the crisis of confidence in business leaders that currently pervades public opinion. I am also pragmatic enough to know that bad actors and examples of corruption exist even in fields where oaths ad codes already exist-such as law and medicine. However, a system for recourse and justice based upon a commitment to a set of reasonable principles can, for instance, publicly identify those who consciously neglect environmental degradation for the sake of short-term profits. Conversely, this very same commitment can signal to employers a certification that an MBA is fit to be a trustee overseeing the long-term sustainability of the corporate entity. I have great hope in the evolution of the MBA Oath and my commitment as a signatory today underscores an unwavering belief that the MBA Oath is a step in the right direction for the business profession and the value we create for society.
Larry Estrada is a joint MBA/MPA student at Harvard Business School and the Harvard Kennedy School of Government.