Can a professional oath turn the tide?

In this second article on the role of morality - or the lack thereof - in the financial and broader economic crisis in which the world presently finds itself, we take a look at what may be required to turn business management into a true profession via a universal professional oath. Would an oath on its own do the trick to ensure that business, besides maximum profit, also seeks to achieve the greater good of society?

In last week’s article, we posed the question whether the financial crisis, at its core, is rather one of morality; and highlighted the drive to establish a Hippocratic type oath for future MBA-graduated business managers turned out by the world’s business schools.

“Long before the accounting scandals of 2001, let alone the crisis that is unfolding today, management had ceased to be guided by the ideals of a profession. What would it take to return management to a professional footing and refocus managers on creating long-term sustainable performance in the interest of society?

“As a first step, we propose creating a code of conduct that orients managers toward their professional obligations and responsibilities,” wrote professors Rakesh Khurana and Nitin Nohria of the Harvard Business School, who are widely credited for having started the drive for such a code, in an article published in July 2009.

Oaths taken by graduating students, aimed at putting business management as a profession on par with professions such as medicine, are indeed becoming a practice at many business schools in the United States and elsewhere, including the Rotterdam School of Management at the Erasmus University in the Netherlands.

An international push

A campaign for the acceptance of an MBA ethics pledge worldwide, modelled on the Hippocratic Oath taken by doctors, was launched from the Harvard Business School. Know as the Oath Project, the aim is to get as many as 6 000 graduates at 50 MBA programes to pledge that they will not put personal ambitions before the interests of their employers or society.

The project co-operates with the World Economic Forum’s Global Leaders (based in Geneva) with the United Nations Global Compact, a New York-based organisation for business, and with the Aspen Institute to spread the idea of the oath beyond US business schools.

At this point, however, taking the oath is a largely voluntary exercise - even at Harvard, where only 55% of last year’s graduating MBA students took the oath.

Only time will tell, but under the present circumstances and general business environment in which - in the words of University of Cape Town honorary doctorate David Lewis - “getting rich (has become) ... the point, the means to that end no longer mattered,” those taking the oath and striving to live up to it may be disadvantaged.

They may find their ideal career limiting in a world where the trend in business is to focus solely on profits and shareholder value.

Is peer pressure enough?

It would seem that the thinking behind the business oath movement at this stage almost exclusively counts on peer pressure to ensure higher ethical behaviour in business management.

In the words of Prof. Khyrana in an interview with Bloomberg: “Business people will benefit personally from taking the oath for the same reasons doctors and lawyers adhere to a code: because those professionals don’t want to be seen as ‘snake-oil salesmen and ambulance chasers'.

“There’s enlightened self-interest that doing good will simultaneously be a benefit to society, but also raise the respect and legitimacy of the institution.”

What is missing in the oath debate at this point, however, is that professions such as medicine and law do not only rely on peer pressure or even peer oversight to ensure high ethical standards.

These professions are not only formally licensed within a legislated framework, but also well organised in legally recognised professional bodies with codes of conduct to back up oaths. If a legal or medical practitioner does not play by the spirit and rules of the profession, his or her peers can take away the licence to practice.

Unless the issue of business ethics is addressed in a more holistic way and a binding legal framework put in place to enforce the spirit and rules of the profession, oaths taken by graduating students are likely to remain largely the subject of ivory tower conversation.