Issue link: https://www.e-digitaleditions.com/i/57337
Your Turn What Is the Purpose of Business? If we were to ask physicians to name the central purpose of their profession, it's likely they all would answer, "To save lives." If we asked scientists the same question, they would probably respond, "To make new discover- ies." And if we asked educators, they would say, "To teach the next generation." But what would happen if we asked the same question of execu- tives, entrepreneurs, managers, stockbrokers, consultants, and others whose careers fall under the aegis of "business"? It's likely that there would be no consensus among them about the purpose for their profession. Some might believe their purpose is to maximize shareholder profit; some might cite a service to community; others might emphasize their personal goals and interests. We believe that, unlike other profes- sionals, managers simply do not have the same overarching understanding of why they do what they do. That's not the way it was at the onset of management education. In fact, when Joseph Wharton founded The Wharton School at the Univer- sity of Pennsylvania in Philadelphia in 1881, he believed the school's guiding purpose was to graduate students who would "serve the com- munity skillfully as well as faithfully in offices of trust" and "aid in main- taining sound financial morality." Over the last century, how- ever, business schools have placed less emphasis on a socially driven objective. Even as business schools incorporate topics such as eth- 54 BizEd JANUARY/FEBRUARY 2008 By Rakesh Khurana and Herbert Gintis Herbert Gintis ics, corporate social responsibility, and self- assessment into their curricula, they have yet to adopt a universal sense of purpose for the role of business in today's society. We believe that, to return to the path that the founders of manage- ment education envi- sioned, business schools must create an identity and sense of shared purpose for the profes- sion they represent. Business students pursue business degrees for a variety of reasons. They may view business schools as places where they can increase their social networks or earn valuable credentials. They may view their business educations as stepping stones to successful, lucrative careers. We do not disagree that a suc- cessful business is one designed to make money, or that successful busi- ness graduates should be prepared to add value to an enterprise. Still, they must also be able to define "value" in terms that go beyond the monetary. Too often, students learn to view the corporation solely in terms of profit generation, not in terms of service to its community. Worse yet, in their ethics courses, students will say they know the dif- ference between right and wrong, but they don't view "doing right" as essential to business success. They learn about scandal-inspired mea- sures such as the Sarbanes-Oxley Act and often believe that brute-force legislation is the only way to compel human beings to do the right thing. Business schools have added courses on ethics and corporate Rakesh Khurana social responsibility, in part, to lead students in a different direc- tion. Educators are experimenting with more courses, more research, and more centers devoted to ethical leadership. But many are uncertain whether these initia- tives will actually make their students more honest—or whether they'll make the corporate scandals of the past less likely to occur in the future. This uncertainty erodes their sense of purpose. When business schools produce graduates who are unsure of the primary objective of business in society, how can society know exactly what role business schools play in the world? Business schools can alleviate this uncertainty by offering students a larger vision of what business can, and should, accomplish for the world. We believe that business schools can be considered as impor- tant to a strong society as science is to progress or as doctors are to good health. Those who think that students wouldn't want to follow a socially driven mission in their business careers should take a cue from game theory. Game theory experiments show that most of our students are neither comprehensively selfish nor selflessly altruistic, but instead care about character virtues such as honesty and fairness. They would embrace a socially driven central objective for business. For example, in an experiment called "the public goods game,"