To change the banks, we must first change the business schools

Get'em when they're young.

The Libor scandal which has dominated the headlines for the past few weeks is just the latest in a long line of bad press for the banks since the financial crash. While policy makers and commentators have focused on the need for reform of the sector, little attention has been paid to the role of education.  But if we want to avoid repeating the mistakes of the past, business leaders of the future need to develop skills in responsible management and a real awareness of the world around them.

Depending on who you listen to, the answer to the problems caused by the financial system is more regulation, less regulation, renationalisation of the banks or sweeping EU powers, to name just a few. These ideas may be different, but at their heart they have one thing in common – the focus on reforming the structure of the banking system.

Although measures like splitting high street banks from their investment counterparts would go some way to protecting the public from reckless banking behaviour, it does nothing to address that behaviour itself. How can we expect to change the greedy, self-interested culture of banking and prevent further scandals if we do not change the bankers who run the system? More importantly, how can we expect to tackle bigger problems that this culture leads to, such as business activities which have a damaging environmental, social and human rights impact?

Building a more stable, ethical and responsible capitalism requires addressing the rotten foundations on which the upper echelons of the business world are run – management and business education. This requires a massive fundamental mind-shift in the lecture halls of our universities and business schools.

For too long these institutions have remained an undiagnosed part of the problem. Consider business school rankings, used by the business leaders of tomorrow to choose where to study for an MBA - the main factor in the most prominent rankings is how much a graduate from that school earns. Not the quality of teaching. Or the grades students achieve. Greed and the pursuit of profit, regardless of the negative impact a business’s activities might have, are built into the system from the very start.

Since 2008 the UN Principles of Responsible Management Education initiative has aimed to inspire and champion responsible management education, research and thought leadership. Aston University, one of the earliest signatories to these principles, has been embedding ethics, responsibility and sustainability issues into the curriculum and aims to ensure that all students will be social responsibility and sustainability literate by the time they graduate. This includes setting up a range of courses in this area and requiring all students going on placements in business to question how companies are addressing these issues. Since then more and more business schools in the UK and worldwide have been adopting the principles.  Almost half of the UK’s business schools have now signed-up.  Further progress was made at the recent Rio+20 conference. Importantly, the major accreditation bodies made commitments to change their requirements in ethics, social responsibility & sustainability and there is a new initiative setting out additional benchmarks for management education.

But there is still a long way to go. We must ensure all of our business leaders are educated to consider the economic, social and environmental impact of what they do and integrate these issues into their business’ core activities. Business should aim to be not the best in the world, but the best for the world. Only then can we avert future business scandals like those of the last few weeks, and more importantly, future financial crises like the one we have been suffering over the last few years.

Carole Parkes is co-director of Social Responsibility & Sustainability at Aston University.

Photograph: Getty Images

Carole Parkes is co-director of Social Responsibility & Sustainability at Aston University.

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UK election results: your guide to what's happened so far

Everything you need to know about the local and regional elections.

Scotland

  • To little surprise, the SNP will be staying in government at Holyrood as the largest party by an overwhelming margin.
  • Nicola Sturgeon’s party looks set to narrowly lose its majority, yet given that the electoral system intentionally militates against majority governments, that shouldn’t be an enormous shock.
  • It was a dreadful night for Scottish Labour. Despite winning Edinburgh Southern from the SNP, the party has almost certainly slipped into third place behind the Scottish Conservatives. Kezia Dugdale, the party’s sixth leader in 8 years, vowed to carry on as party leader.
  • The Conservatives, wiped out north of the border in 1997 and barely ever a force in Holyrood since 1999, are now the assembly’s main opposition. Ruth Davidson, the party’s leader, won a constituency seat in Edinburgh from the SNP. The party also took Eastwood, long a Labour stronghold – perhaps hinting at broader problems for the Labour party nationwide with Jewish voters.
  • The Liberal Democrats are not dead yet. Willie Rennie, whose campaign highlights included being interviewed in front of a pair of romping pigs and launching his manifesto in a soft play area, took the seat of North East Fife from the SNP, while his party also held seats in the Scottish islands comfortably.

 

Wales

  • Labour remains the largest party, albeit probably in a minority, and should govern alone fairly comfortably.
  • Leighton Andrews, a long-serving member of the Welsh government, was unexpectedly defeated by Plaid Cymru leader Leanne Wood in his Rhondda constituency.
  • The Conservatives failed to make significant gains, with party sources blaming the row over Port Talbot’s steel.
  • UKIP won its first seats in the assembly, picking up at least 4 assembly seats through the list, including former Kent MP Mark Reckless – with disgraced former Conservative MP Neil Hamilton also expected to win a seat later on.
  • Labour retained the Ogmore seat at Westminster in a by-election, with UKIP in seco nd place.

 

England

  • Labour have become the first opposition party to lose seats in midterm elections since 1985 – when Neil Kinnock’s Labour Party still lost fewer seats than the Conservative government.
  • That said, the party’s results were probably not quite as bad as some feared – the party retained control of Crawley and Southampton, though lost Dudley to no overall control.
  • The Conservatives gained some council seats, taking control of Peterborough council, but losing Worcester to no overall control.
  • UKIP became the joint-largest party on Thurrock council, drawing level with the Conservatives – and missed out on taking a further seat from the Conservatives by just 1 vote.
  • Labour won the Sheffield Brightside by-election, with UKIP in second place.
  • Joe Anderson won re-election as Mayor of Liverpool with more than 50 per cent of the vote.

 

London

  • The count for London Mayor and the Greater London Assembly began at 8am, with the result expected to be announced in the late afternoon.
  • Campaigners on all sides predicted record low turnout. 

Henry Zeffman writes about politics and is the winner of the Anthony Howard Award 2015.