The creation of this department reflects a growing demand for attention within business schools to issues relating to the relationship between firms, on the one hand, and their regulatory, social, political, cultural and ethical environment, on the other. This demand comes in part from business leaders, who report that (i) these issues are looming ever-larger in their decision-making environment, and (ii) traditional business school education does a poor job of preparing leaders to address these issues in a sophisticated and integrated way. (See, for example, Rethinking the MBA: Business Education at a Crossroads for a discussion of these failings.)
Consistent with this notion, the McCombs School has seen a striking increase in the last decade in demand for executive education programs focusing on corporate social responsibility, government relations, and stakeholder relations issues. Students demand is also a driver of the department’s creation. Students seek coursework in these fields, either because of an appreciation for their importance or because of employer interest in students who are equipped to handle these dimensions of business decision-making in a sophisticated way.
The redesign of the Texas MBA program a few years ago reflects these trends in its emphasis on “Responsibility and Integrity,” “Communication and Collaboration,” and “Worldview of Business and Society” as three of its four key pillars. The BGS Department represents a further development of these ideas, one that puts McCombs among a select few business schools addressing these issues at the departmental level. At McCombs, we are bringing social scientists, legal scholars, and ethics scholars together under the BGS department umbrella to focus scholarly and curricular attention on these issues, and (just as importantly) on the connections between these issues in the real world.
Department FAQs
How can one teach ethics? Haven't most students already developed their own sense of right and wrong by the time they get to McCombs?
Ethics education at McCombs has never been about trying to tell students what is morally right or wrong. Most students have formed some sort of ethical or moral sense long before they come to McCombs, and it is not our goal to change that. Rather, ethics education at McCombs is about helping students recognize ethical dilemmas when they arise in business settings, and providing students with a framework for thinking about those dilemmas, so as to avoid making business decisions that fail to meet students’ own ethical standards. For a variety of reasons, business leaders (and students) may be inclined to push the ethical dimensions of business decisions out of their minds, to their later regret. Part of the way we teach ethics at McCombs is by helping future business leaders learn to face and understand the ethical dimensions of business decisions. Thanks to advances in behavioral psychology and neuropsychology, we know more than ever before about how managers might succumb to ethical pitfalls in business decision-making. We think it is worth helping students explore ways of structuring the business environment so as to avoid those ethical pitfalls. That is what we mean by “teaching ethics” at McCombs
Shouldn't business students learn simply to maximize shareholder value, and leave it to governments and law to protect society or enforce important social values?
That is certainly one view of what the relationship between governments and markets ought to be; however, it is not a very good descriptor of what that relationship actually is. In practice, markets depend upon the presence of legal/political institutions and ethical/social norms for their existence and smooth functioning. Moreover, while ethical norms and legal rules may overlap substantially (particularly in well functioning democracies), nowhere are their boundaries identical. Business leaders will be confronted with some decisions that pose ethical dilemmas, but not legal ones. Just as failure to adhere to legal rules poses liability risk, failure to recognize the social or ethical dimensions of a decision can pose reputational and other risks. And in today’s global economy, McCombs business students are more likely than ever to do business in (or with people from) nations and cultures where the overlap between ethical norms and laws is relatively small, and where the role of the legal system is quite different than it is in the United States. Part of the BGS department’s mission is to promote a better understanding of the ways in which these complex and fluid social, ethical, legal, political, and cultural forces interact with one another, and influence business decision-making.
Can't business students just go to the law school to learn about law and regulation, and to the LBJ School to learn about public policy and politics?
Generally speaking, the first goal of the law school curriculum is to train lawyers, and the first goal of the LBJ school curriculum is to train public officials. Of course, that does not mean that business school students can’t derive value from courses in those institutions. To the contrary, McCombs students can and do take courses in other parts of the university, and can develop a deeper appreciation for the perspective of government officials, lawyers, etc. by doing so. However, business students also need courses that help them examine regulatory and legal issues from the point of view of the business leader and the firm. (That is one reason why McCombs – like Wharton, Michigan, Indiana, and several other major business schools – has long had its own group of tenure-track legal scholars.) The BGS Department is multidisciplinary: it houses faculty working on the economics, politics and law of regulation, policy, and business ethics. We expect the department to grow in the coming years, and to add to our expertise in economics and political science. Economics, political science, and legal scholarship can inform our understanding of the relationship between markets and firms, on the one hand, and government and society, on the other. Therefore, BGS courses at McCombs are informed by each of these disciplines (and others), and are designed to help future business leaders make better business decisions, decisions that reflect a sophisticated and nuanced understanding of the regulatory, social, political, cultural and ethical environment of business.