Business schools put higher value
By Diane E. Lewis, Globe Staff, 2/23/03
Just a few years ago, students in Susan Adams's undergraduate business course at Bentley College were preoccupied with making money. Now, with the chief executives of Enron Corp., WorldCom Inc., and Tyco International Ltd. under scrutiny by regulators, they want to know more about fostering good corporate values.
''Five years ago, they were interested in personal power and financial gain,'' said Adams, an associate professor of management. ''It was money, money, money. Now, they seem to be more humanitarian. They've seen their parents and other people burned and they are saying, 'Let's go with what matters most.'''
At Babson College in Wellesley, Thomas Sullivan, a professor of ethics and director of spiritual life, has seen a similar change in attitudes. ''Last year, some students felt, 'Why waste time on ethics?' '' he said. ''This year, I get almost none of that. They are on the edge of their seats.''
From Boston to Berkeley, business schools are responding to students' growing interest in ethical matters and the nation's mounting concerns about corporate responsibility by beefing up ethics lessons, adding lectures, reevaluating curriculums or taking a harder look at how they prepare the country's future managers and employees to be conscientious leaders.
''Business schools are saying, 'Gee, given all that has been going on we want to take a closer look at how we are teaching business ethics and corporate governance,' '' said Mary C. Gentile, a consultant with the Aspen Institute's Initiative for Social Innovation through Business in Aspen, Colo.
This spring, the Association for the Advancement of Collegiate Schools of Business International will release a report on new standards for accreditation that will contain information on how ethics and corporate responsibility should be taught and represented in campus life.
The group was already reviewing standards when the scandal at Enron broke in 2001, but news of the accounting scandal spurred the organization to make ethics a bigger part of its agenda. Based in St. Louis, the AACSB accredits close to 450 business schools in the United States and abroad. It also sets criteria for achieving accreditation, and it reviews member schools to make sure they meet current standards.
''The whole explosion of the scandals heightened our attention to the issue of business ethics,'' noted Carolyn Y. Woo, AACSB chairwoman-elect. ''So, we decided to increase the emphasis on business ethics in our accreditation standards. For example, in the past we would say that a school should teach ethics. The new standards, which will be approved at the organization's meeting in April, ask that schools also demonstrate that they have created an ethical environment.''
Some universities say they already incorporate ethics in a variety of disciplines, and in the mission statement that governs campus life. Still, they are looking for new ways to get the message across. Last month, dozens of faculty, corporate representatives, lawyers and students attended a program and panel discussion sponsored by Northeastern University's College of Business Administration and the Boston Stock Exchange. The topic was Ethics and Corporate Responsibility.
Ira R. Weiss, dean of the business school, said Northeastern has also launched a Friday forum series for MBA students. Corporate executives are invited to speak about ethics, business practices, and accounting at the sessions. In addition, freshman students in the university's undergraduate program must now participate in a first-year seminar on ethics.
''We have always had a philosophy that ethics would be incorporated in the various disciplines,'' noted Weiss. ''This year, we brought this down to the freshman year. Students must understand that ethics should be grounded in their own everyday behaviors and not just when they go out into the job. . .We felt that not doing it would, in some ways, ignore current events.''
Bentley College in Waltham has put together a task force to examine whether the college is doing all it can to fully integrate the study of ethics, service, and responsibility in the curriculum, and encourage ethical concerns in campus life. The college, already known for its Center on Business Ethics, expects to receive a report from the task force in March.
''We offer quite a few programs on ethics and corporate responsibility, but we would like to link them together into a coherent whole and integrate them into the community,'' said Aaron Nurick, chairman of the task force and the Wilder professor of management and psychology at Bentley. ''We also want to create a culture of integrity.''
Some schools are using current events to foster change and discussion. This fall, students at the University of California at Irvine, attended a lecture taught by Sherron Watkins, the Enron whistle-blower whose memo to then-chairman Kenneth Lay exposed the financial irregularities that precipitated the company's collapse.
In Cleveland, the Weatherhead School of Management at Case Western Reserve University fashioned a course based on malfeasance at Enron called, ''Accounting 418: Financial Reporting Fraud.'' It taught students how to recognize accounting fraud, and explored why Enron executives went along with the ruse. Among the reasons: lucrative compensation and rewards.
''We started incorporating the daily headlines as part of the course,'' said Robert Bricker, a professor of accounting at CWRU. ''It was a rich source of inspiration. We looked at how earnings management can turn into fraud, and we looked at how to determine who is telling the truth. That led to the creation of another course on forensic accounting, a course that shows students how to diagnose and recognize [earnings misstatements] on paper before they become a problem.''
A similar class at Northeastern helped Agnes Walkowiak, 21, of Milton, solidify her career goals. The class focused on how Enron cooked its books.
''I gained more from that course than from any other accounting course I've taken thus far,'' said Walkowiak, who wants to use her new financial sleuthing skills to uncover fraud for the Central Intelligence Agency. ''Our professor said that the people who can best spot a fraud are the ones who know how to commit one. So, we pretty much got into the minds of the fraudsters.''
Diane E. Lewis can be reached at email@example.com.