This article was published in Issue 02 of The Beautiful Truth. Order your copy here.

If you want to be a leader confident in your deepest values and your role in the universe, go to business school. At least, that’s what business schools say. In recent years, they have branded themselves as places where students learn to stay “true to your mission” (Columbia Business School) and undertake a “truly life-changing experience” that values “health, happiness, and purpose” as well as “authenticity and renewed passion” (Stanford Graduate School of Business).

Marketing teams across higher education are fond of quasi-spiritual taglines, so it might be unfair to pick on business schools. But in the MBA world, the latest breathless versions of these slogans signal more than the generic American vocation to make money and live your best life now. What is remarkable is this: after decades of emphasis on financial markets and shareholder returns, business schools are trying to take on deeper philosophical problems – including, maybe, tentative questions about the means and ends of capitalism itself.

Over the last few years, student interest in the social impact of business has soared. Even before the pandemic, business schools were offering initiatives and programme concentrations with names like ‘Conscientious Capitalism’ at Leavey School of Business and ‘Sustainable Business’ at NYU Stern School of Business, in line with investors’ growing interest in ‘environmental, social and governance’ considerations, better known as ESG.

“There’s been a little tempering of the fervour for laissez-faire capitalism. There’s healthy conversation about that,” said Brian Lowery, a professor at the Stanford Graduate School of Business, where he recently taught a course on ‘Reimagining Work Post-Covid.’

Such conversations reflect a longstanding ambivalence about what, exactly, business schools are for. Is their purpose to train general managers as a professional class with a shared body of knowledge, like lawyers or doctors? Or should they provide targeted programmes that offer technical skills? Are they a kind of divinity school for secular capitalists, where students discern their true vocation? Today’s business schools try to fulfil all these aims at once – but it is hard to teach narrow, applied skills and also encourage students to wrestle with giant, ambiguous questions about ultimate values and hierarchies of power.

The current surge of interest in deeper questions is not new, but rather a return to the original aims of the first modern business schools. The goal of the Tuck School of Business, founded in 1900 at Dartmouth College, was to educate “the man first and the businessman afterwards”. At the dedication of Harvard Business School’s new campus in 1927, one speaker declared “that the ministers of our business, like the ministers of our churches, should appreciate their responsibility”. He stressed the need for businessmen to have a wide-ranging education, to become “men who have not only a broad outlook in history, politics, and economics – but men who have also that moral and religious training which tends to develop character”.

Then, as now, these grand declarations reflected a mix of sincere conviction and a desire to persuade sceptics that training students to make more money can also be a genuine intellectual enterprise.

Historians of business education have traced the rise and fall of this ideal of “the CEO as enlightened corporate statesman,” as the Harvard sociologist Rakesh Khurana put it in his book, From Higher Aims to Hired Hands. Faith that managers could – and should – have long-range vision and a sense of public responsibility crumbled in the economic crises of the 1970s. The corporate models, like the ‘Theory of the Firm’, that emerged from the wreckage recast executives – and aspiring managers at business schools – primarily as agents of shareholders, indentured to serve the stock market price or valuation of private shares before all else.

This mindset has pushed business schools to train managers to maximise shareholder value on quarterly returns, in the same way a NASCAR crew chief trains to manage a pit crew to get the car back on the track as quickly and efficiently as possible. This has left little room for that older ambition to cultivate character or wide-ranging intellectual curiosity – although business schools papered over the void by embracing the language of positive psychology and an amorphous idea of ‘leadership.’

Plenty of critics inside business schools have noted this reluctance to ask big-picture questions, despite the fad for genuflecting to environmental, social and governance concerns. Some note that schools are adept at defanging detractors, cordoning them off in their own professional journals and conferences and keeping them on payroll.

“I’ve been rewarded for being as cheeky as possible,” Martin Parker, who teaches at the University of Bristol’s School of Management, told me. When his current employers hired him, they knew he was about to publish a book called Shut Down the Business School, but they didn’t mind. “That doesn’t say they were particularly brave, but that my critique doesn’t matter very much,” Dr Parker told me. “It’s not particularly threatening. I’m being petted by the emperor.”

Diversity initiatives and attention to environmental and social impact, he said, “amount to greenwashing, or ethics-washing, and conceal the major epistemological and structural issues that business schools assume, and glosses them with a particular kind of website fluff. It’s liberal fairy dust. Others don’t see it that way. They think capitalism just needs to become quite a bit nicer, that we need to orient corporations toward more benign investment strategies and less toxic relations with workers. That would be good – I’m not against small steps – but that diagnosis doesn’t reflect the nature of the problem we have.”

Even professors who push the envelope in their research pull back from challenging the instrumentalism of business schools, the focus on supposedly neutral tools and skills. Professor Lowery of Stanford, whom I mentioned earlier, is a social psychologist who studies the intersection of race and class. But he keeps normative questions out of the classroom. “Most of what I teach is designed to be as neutral as possible in terms of the explicit morality of what you should do,” he said. “I say this explicitly to students: the content is amoral. You can use it to achieve any sort of goal. It just helps you understand how people operate in social environments. It’s a set of tools.”

Dr Lowery has taught Stanford’s most popular elective, a decades-old course called ‘Interpersonal Dynamics’ (nicknamed the ‘Touchy Feely’ course) in which students exchange candid feedback in intense sessions that many compare to group therapy. Students rave about the experience, which is based on the psychologist Kurt Lewin’s ‘training group’ sessions in the 1940s, a precursor of modern workplace sensitivity programmes. This sounds like a welcome break from a curriculum full of financial instruments and quantitative modelling, although the course is perhaps not all that different: students are simply studying the efficient management and transfer of emotions.

Kelsey Aijala, a student at Stanford who is graduating this spring, told me that the leadership courses she has taken “are not values-driven – not forcing you to think about your values as a leader. There are courses about a purpose-driven life, and I’m taking a course now about strategic pivoting, but these are not asking you to think about your role in society. It’s more like ‘designing your life,’ and the curriculum still sits within a traditional business skill set.” It is hard to see how students can ‘find their purpose’ in a curriculum too focused on sharpening tools to ask what those tools are for.

This may sound like the critique of a fuzzy-headed humanist who has no idea how the real world works, but I’m only echoing the conclusions of insiders. The businessman “needs breadth of knowledge, a sense of historical perspective, and flexibility of mind,” wrote the authors of ‘Higher Education for Business,’ a 1959 study commissioned by the Ford Foundation. “He needs also to have a sensitive and sophisticated appreciation of the role which business does and can play in our kind of society. All this implies some familiarity with the more relevant branches of history and perhaps philosophy, and some knowledge of the social sciences, particularly economics, political science and sociology.”

The Ford report – and a similar one sponsored the same year by the Carnegie Corporation – warned against ignoring the humanities or allowing faculty members and students to specialise too narrowly. Yet the funding that followed pushed schools in the opposite direction, consistent with the 1960s vogue for number-crunching wonkishness. Business schools embraced the hyper-specialisation that pervades the rest of academia, falling especially under the thrall of economics and other heavily quantitative disciplines.

This fragmentation has accelerated in recent years as the more expansive MBA degree has ceded ground to shorter, narrower master’s degrees in topics like marketing and operations, often tailored to specific occupational contexts like healthcare or technology. Many programmes permit students to sample electives in other parts of the university, but offer little structure for pulling this hodgepodge together. Business schools now pump out “over half a million narrow specialists per year” into an economic culture that prizes quick returns and efficiency, Roger Martin, the former Dean of the University of Toronto’s Rotman School of Management, wrote in his recent book When More Is Not Better (2020).

“Business schools have long promised, ‘We’ll make you this general, leaderly kind of person,’ but they don’t,” Mr Martin told me. “You come and get taught a bunch of narrow disciplines, and the assumption is, oh, the students will figure out how to fit those together. They will integrate across those fields and become general managers. But most don’t.” He lamented the absence of the humanities, qualitative disciplines that “teach someone how to think in a complex adaptive system. We treat that system like something else – we silo-ise it, break it into chunks, put it back together and think it will be fine. The humanities are the only hope for thinking about things in holistic, non-quantifiable ways.”

Here is the central tension of modern business education: at a time when society needs managers who can grapple with uncertainty and operate in a culture divided over basic questions of justice and human flourishing, most business schools still emphasise specialised skills and quantitative methods, the seductive simplicity of economic and social scientific models. They often reduce the weirdness of human organisations to the tidy pedagogy of the case method, in which students discuss 15 to 20-page accounts of how an individual or a corporation handled some task or crisis.

“The case method is theatre,” Mr Martin said. “There’s a case, and then there’s a teaching note that says what the point of the case is. Some notes will be as specific as to say: ‘ask the following question, wait until you get this answer, then write that out on the board.’ It’s no different from Shakespeare – people have lines, there are multiple acts, everyone plays their role and you know the answer ahead of time.”

The case method does not dominate every business school, but Harvard Business School, where the method originated, sold more than 15 million cases to other schools and organisations in 2020. Mr Martin estimated that 30% of North American business education is “aided and abetted by an HBS case”. Ms Aijala, the student at Stanford, said that the case method “can be helpful to grapple with some of the dilemmas that business leaders have faced, but we’re usually doing it in a rapid-fire way that I don’t think promotes critical reflective thinking on deeper issues. Because participation is something you’re evaluated on in class, it promotes saying something for the sake of saying something and doesn’t create space for deeper questioning.”

Yet the writing and teaching of cases has become more nuanced in recent years, partly in response to the focus on environmental and social impact. “We do this nice thing where in each case, you map out all the stakeholders in the process,” Cynthia Madu, who is about to graduate from the Tuck School at Dartmouth, told me. “It lets us identify all the people actually there, so we don’t think it’s the CEO doing everything. Also, if students know there’s not one single narrative, they’re more willing to debate in class whether it’s the correct narrative.”

Business school professors are also broadening the kinds of questions deemed relevant to modern business. “I’ve been buoyed by the diversity of what’s now considered economic research,” Ethan Rouen, a professor at Harvard Business School who teaches a course called ‘Reimagining Capitalism’, explains. “At HBS we have people doing research on gun control, on the Rohingya genocide. This is new, and every year it’s going more in that direction.”