Study: B-Schools Must Look Beyond GMATs for Good Ethics

A new study suggesting that business school admissions inadvertently favor candidates prone to unethical behavior has caused quite a stir, largely because of some provocative stories that stretch the point to drum up web traffic.

The study in The Journal of Business Ethics found a correlation between students who had high scores on the GMAT, the test that plays an outsized role in business school admissions, and some negative business traits, including weak ethical instincts.

The authors of the report, Raj Aggarwal, Joanne Goodell, and John Goodell found that by mostly admitting candidates with high GMAT scores, top business schools end up admitting more people with certain tendencies (risk avoidance, individualism, and more acceptance of unequal power distribution, to name a few).

The authors add, in what seems like a questionable conclusion to me, that high GMAT scores also correlate with lower ethical standards. They note that ethical behavior “arises from awareness of collective virtues” and conclude that the correlation to individualism is therefore a negative correction to ethical behavior.

They also found that those with higher GMAT scores were more accepting of unequal power distributions, which they say leads “to corruption and unfair negotiating tactics—each an aspect of unethical behavior.” In addition, they found that high GMAT scores had a negative correlation with cultural ethical orientation. In other words, people from countries that had lower ethical profiles and fewer corruption controls did better on the GMAT.

The authors conclude that the emphasis on GMAT scores is partially responsible for “the lack of ethical orientation in business and for the lack of success of whistle blower programs.”

This seems like a stretch to me, and in any event, it hardly suggests a solution. The GMAT is already controversial and this may add to the debate over whether it should be restructured or de-emphasized in the admission process. I’ll let others hassle over that (and they are). I’ll just point out that the study points to correlations between high scores and certain characteristics; it doesn’t address causality. And there’s room for debate on the study’s methodology. For example, I don’t think it follows that a business school candidate has a lower ethical profile just because he comes from a country with lax corruption controls. He may, in fact, be more aware of the corrosive effect of corruption and have stronger ethical tendencies.

We want and need the business world to act more ethically, but surely the answer is not to start favoring candidates with low GMAT scores. It would make a lot more sense for business schools to revamp their admissions processes to put a greater emphasis on ethical tendencies and to beef up courses aimed at teaching ethics. And businesses need to look beyond grades when they hire and test applicants on ethical issues to make sure they are hiring people with the right priorities. If this new study leads to that, it will have done a great service.

That, in fact, is what they authors are recommending, but you hardly know that if you just glanced at the headlines on the posts I have seen from journalists, bloggers, and other writers. Too many have given their stories an alarmist twist or headline, thereby committing their own ethical error. I think the worst example I saw was a headline that read: “Is the GMAT the Root of Evil in the Business World?” (Putting a question mark at the end doesn’t lessen the sin; it only suggests the headline writer knew he was going too far and tried unsuccessfully to hedge.)

In The New Ethics of Journalism, which we reviewed recently, danah boyd and Kelly McBride addressed this kind of hyperventilation in an excellent essay, “The Destabilizing Force of Fear” (pp. 172-188). They note that while “fear sells particularly well,” it can undermine rational debate. It’s bad enough when that happens on a news story. It should be intolerable when the issue is how to promote ethical behavior.

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