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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Can Nicola Sturgeon keep Scotland in the EU?

For Sturgeon, Scotland's rightful place is in the EU. If that means independence, so be it.

In the aftermath of the EU referendum, when Remain voters were still nursing their hangovers, a meme began to circulate on Scottish Facebook pages. It was an image of Nicola Sturgeon, the First Minister, her arms outspread, with a simple message: “F***in’ calm doon. Am oan it.”

At a time when British politicians are mired in the kind of chaos seen once in a generation, Sturgeon has emerged as a figure of calm. While her fellow Remain campaigners were speaking tearfully to news cameras, she addressed EU citizens, telling them: “You remain welcome here. Scotland is your home and your contribution is valued.”

When Boris Johnson declared, “Project Fear is over,” she retorted on Twitter, “Project Farce has now begun.” Her message has been retweeted more than 6,000 times. Faisal Islam, the political editor of Sky News, remarked on air that she seemed to be “the person with the most thought-through plan”.

Sturgeon now presents herself as Scotland’s anchor to Europe. Yet critics view her actions as those of a veteran independence campaigner seizing a chance denied to her by the Scottish referendum two years ago. In reality, she is working for both objectives.

It is hard to imagine now but the Scottish National Party was once suspicious of the idea of an independent Scotland in Europe. The idea took hold thanks to Jim Sillars, the Labour MP who led the 1976 breakaway that formed the Scottish Labour Party. He defected to the SNP in the early 1980s and became one of its strongest pro-EU advocates. The promise of an independent state within a larger framework was soon a mainstay of the party’s campaigns. The 1997 manifesto promised voters “the restoration of self-confidence and the creation of a modern democracy in the mainstream of European life”.

In the early years of the Scottish Parliament, Sturgeon’s approach to the EU was one of a negotiator, not an idealist. In 2003, she put forward a motion that the Scottish Executive should oppose the reduction of Scottish seats in the European Parliament from eight to seven. “Scotland, with no seat on the Council of Europe, no commissioners and fewer MEPs than comparably sized independent member states, has little enough influence in the EU,” she argued.

Her interest in representation emerged again in 2005 when she described an EU proposal on software patents as “a serious threat” to developers. She noted that: “There was apparently no Scottish minister at the Council to represent Scottish interests, the UK instead being represented by an unelected member of the House of Lords.”

Sturgeon’s commitment to work with the EU has not always been reciprocated. In the Scottish referendum, as deputy first minister, she promised the continuity of EU membership. Yet José Manuel Barroso, the then president of the European Commission, said it would be “extremely difficult, if not impossible”, for an independent Scotland to join. Some consider his statement to have been crucial to the success of the No campaign.

When the EU referendum arrived, Sillars, the architect of the SNP’s Europhile agenda, criticised the “love affair” that he believed his party was indulging in and joined the campaign for Brexit. Sturgeon made a different calculation. She threw herself into the Remain campaign, though she was careful not to stand alongside David Cameron. She played down the Scottish independence line – when asked, in the run-up to the vote, if she was a unionist, she described herself as “an enthusiastic European”.

She turned her reputation as a “nippie sweetie” to her advantage. Once viewed as a dour machine politician, now Sturgeon was warm to voters while cutting Boris Johnson down to size. There was no need to scaremonger over Europe, she said. A positive campaign was enough. There is no doubt that she tapped in to the popular feeling: 62 per cent of voters in Scotland opted to remain in the EU, compared to 48 per cent in the UK as a whole. Every local authority area north of the border voted Remain.

As the referendum results rolled in, she prepared to go it alone. “There are no rules,” Sturgeon told Andrew Marr. “The status quo we voted for doesn’t exist.” To her, Scotland’s rightful place is in the EU and if that requires independence, so be it.

She offered to meet Brussels diplomats. She contacted EU institutions. She put forward a motion in the Scottish Parliament demanding “the Scottish government to have discussions” in pursuit of “protecting Scotland’s relationship with the EU”.

Yet Barroso’s warnings may come back to haunt Sturgeon. She has always painted a picture of an independent Scotland in Europe as one that is nevertheless tied to the British Isles. Its currency is the pound; Scots and the English move freely between Glasgow and Carlisle. EU member states may seize on her proposal, or use it as a way of repeating the rebuff of 2014. Sturgeon the nippie sweetie negotiator has her plan for a European Scotland. Now she must wait for Europe to answer. 

This article first appeared in the 30 June 2016 issue of the New Statesman, The Brexit lies