The Biggest B-School Scandals Of 2018

Posted January 1st, 2019.

As It Appeared On
Forbes

John Byrne
Contributor

Each year, some of the world’s most elite business schools are embroiled in scandal. 2018 was no different — from deans resigning or being removed for various reasons, to complaints of hazing at a top school’s welcome week, to the mishandling of diversity and gender issues, we saw it all. But two big storylines in particular cast shadows upon some of the world’s top B-schools: rankings fraud and sexual assault.

This year, Columbia Business School earned headlines in the wrong way. Toward the beginning of the year was the #MeToo trial between a junior professor and senior professor. It was a literal case of what can and should be addressed in the business school setting when it comes to workplace #MeToo lessons. Later in the year, CBS Dean Glenn Hubbard announced he would step down from his job at the end of this academic year. And before year end, a current MBA student at the New York City school came forward with very legitimate proof that her and other female classmates had been sexually assaulted by their male counterparts at various school-related social functions.

And then you have rankings. Sometimes schools go too far in falsifying data, and that was the case with Temple University’s Fox School of Business. It turns out their stellar placement in various online MBA rankings was all a facade based on falsified data reported to U.S. News & World Report.

Below, in no particular order are the scandals and controversies that stood out the most in 2018.

10. University of Southern California Marshall School of Business Ousts Dean (And One Former Student Tries To Rally Others To Save Him)
It wasn’t an ideal kickoff to the holiday season for long-term USC Marshall Dean Jim Ellis. In December, the Los Angeles Times first reported he was being terminated effective on June 30th of 2019 — three years ahead of the end of his current five-year term. USC Interim President delivered the news, citing allegations that he failed to properly deal with a series of racial and gender bias complaints at the school over the past eight years.

The news came at an odd time for Dean Ellis, who will remain at Marshall as a faculty member. Earlier this fall, USC’s Online MBA program debuted at the top of the Poets&Quants ranking of online MBA programs. Two months ago, Ellis received a $70,000 bonus from the university. Just one month ago, the school received a stellar ranking, placing 13th in Bloomberg Businessweek’s most recent ranking of full-time MBA programs. To top it off, USC Marshall became the first major elite MBA program to reach gender parity in an incoming class, enrolling 52% women this past fall.

The termination of the highly popular dean has set off a firestorm of controversy — especially among his supporters, many of which are wealthy boosters and benefactors of the school. “Of these complaints, only about 10%—an amount you can count on both hands—were deemed sufficiently worthy of being passed on to the dean for further investigation and resolution,” wrote Lloyd Greif, a major benefactor of the Marshall School in a letter to the university’s board of trustees. “Jim dealt with all of those timely and appropriately. None of the complaints alleged any egregious misconduct, and none of them involved inappropriate behavior by Jim.”

Greif has led the charge to fight for Ellis.

“I was brought up not to look away when you see something wrong,” Greif told P&Q earlier this month. “I recognize there was personal risk in standing up for him. But I’ve got to sleep at night. I can’t let an injustice happen to an innocent man. I am not that kind of fair-weather friend. This is unjust.”

As of mid-December, thousands of people had signed a petition in favor of Ellis and hundreds of letters had been sent to the school on his behalf.

9. UC-Berkeley Haas School of Business’s Diversity Flub

If there’s one MBA program that absolutely prides itself on being a leader and innovator in diversity and inclusivity, it’s the Bay Area-based Haas School of Business. It’s located in Berkeley, the town that led the free speech movement and played very large roles in the push for civil rights and disability rights. The campus has been a beacon for progress for decades. And this past fall, it enrolled just six African-American students into its full-time MBA program. It wasn’t just the small number that was the issue. The school enrolled it’s largest class ever at 291 and admitted 28 African-American applicants, meaning only about a fifth of African-American applicants admitted actually enrolled.

The result led the school to do some soul-searching and look inward as an institution. Stakeholders across the school including the student-led Race Inclusion Initiative, the Haas Alumni Diversity Council, the Consortium for Graduate Study in Management, and the Black Business Student Association, created a Haas action plan to confront a perceived lack of inclusiveness at the school and details “necessary actions and concrete plans” for reversing a two-year trend that resulted in a 68% drop in black enrollment in the MBA program. Among the top recommendations: hire a director of diversity admissions and create scholarships available to under-represented minorities, or URMs.

“Our leadership team failed to react quickly or urgently enough,” reads the report, authored by Courtney Chandler, senior assistant dean and chief strategy & operating officer, and Jay Stowsky, senior assistant dean of instruction. “The leadership approached the data using an ‘academic’ lens. We looked at the positive previous eight-year trend of increasing African-American enrollment and saw the sudden decline as a two-year statistical anomaly. Even if historically this may have been within our normal range, it doesn’t make our response acceptable — we should never become comfortable with a norm of underrepresentation.

“We need to live up to all of our Defining Leadership Principles and question the status quo. Our actions need to match our intentions. Our slowness to act broke trust with our students and alumni. We are deeply sorry about this.”

8. Confessions Of A Hult Student Recruiter

The Hult International Business School is no stranger to catching bad online public relations flack. And this year, the school had another doozy when a former employee posted a very telling — and damning — post on Reddit. Under the heading of “Ex-Employee of Hult International Business School,” the anonymous poster essentially gave readers a play-by-play on how the school finds and closes would-be students for its MBA, Executive MBA, and other master’s programs in business.

At first, the process seems common and innocent enough. Not unlike other schools, Hult tracks people that complete the TOEFL and GMAT. Then, the leads are split into markets by regions of the world, including Europe, Asia, the U.S. and South America and then the cold calls begin and are made by a staff of people who spend their entire days on the phone.

“Closing isn’t done in one call,” the poster added. “First we call to make sure the number is correct, the individual could fit studies in their schedule, and most importantly tht they have some way to bring forth the ca$h needed ($20K-$40K depending on the program). Then, after having assessed all these needs (test scores not being a priority of course) a description is made of how amazing the school and its program are, and an excuse to have another call is set up (‘so that you can discuss with your family,’ ‘so that you can do the math/speak with the bank/etc,’ or the best one ‘at a time where we’ll have more time to speak.’).”

But then it went further when the poster, who describes himself as a Hult staffer who helped recruit students to the school’s programs, then claimed that Hult doctors its employment report for graduates. “Alumni that don’t find a job within three months are given the status of ‘entrepreneurs’ and don’t feature in employment statistics,” he alleged. “Or they are offered a job at Ult or one of its affiliates. This is also done to help the statistics” which claim that 91% of our students find a job within three months.”

The allegations set off furious questions and comments from many other Reddit users and led the school to respond.

“It sounds like a disgruntled former employee has shared some doubts about our stats which is of course unfortunate, but we can’t expect all members of staff to be familiar with the rigorous, standardized process surrounding rankings and accreditation,” said Markus Mandl, Hult’s chief marketing officer. “The fact that we are experiencing continued success in both, our ongoing accreditations process as well as in the premier rankings of business school programs is a testament to the positive impact of our unique approach to global higher education.”

7. False Posts & Fake Traffic At Beat The GMAT?

Fake news is one thing, but a fake community and conversations is another. That’s what admissions consultant Daniel Morgan claimed Beat The GMAT has been doing in its online forums. Earlier this year, Morgan claimed that while BTG’s forums are designed to appear as a marketplace of ideas for curious would-be MBA seekers, the exchange of information is being manipulated by fake users that post high volumes of repetitive questions and generic comments, and that don’t interact or respond to questions.

BTG responded to the allegations by saying the site is just trying to keep up with the competition by employing common tactics that actually serve users well by, among other things, regenerating old content. Beat The GMAT claims to be “a social network where MBA applicants, students, admissions officers, GMAT teachers, and MBA consultants openly collaborate and share free advice.” But Morgan, who graduated with an MBA from the University of Chicago Booth School of Business in 2012, says they are using dishonest tactics and even employing paid content generators under the title of “moderators.”

“I do think this stuff happens a lot (around the web),” Morgan, a former derivatives trader for Susquehanna International Group and equity analyst for Albert Bridge Capital, said. “I really feel that it’s something that needs to be brought to light. In my mind creating fake profiles to populate a forum with a view of profiting from it is an unethical practice.”

6. Heads Roll At IE After Ranking Release

Earlier this year, when The Financial Times released its annual ranking of global MBA programs, a familiar name was absent. The IE Business School was nowhere to be found. The exclusion led to the firing of two staffers and forced resignation of another in an effort to regain the trust of the school’s alumni base.

In a letter to alumni and IE’s senior leaders, the school also said for the first time that it could not rule out the possibility of “wrong doing” by IE staffers that resulted in the newspaper’s decision to remove the school from its ranking for the first time ever. And has reassigned the management of the rankings from external relations to Martin Boehm, dean of the business school.

According to the FT, IE was excluded because of “irregularities” in the alumni survey, claiming that alums outside of the Class of 2014 — the intended alumni group to be surveyed — completed the survey. “We take the integrity of our rankings very seriously and this is not the first time a school has been disqualified,” a spokesperson for the FT told P&Q. “In this case, the quality of the data we received was not good enough. We received surveys completed by people who were not who we thought they were. We alerted IE to this issue and we have asked them to urgently tighten their data collection procedures so that they can be included in future rankings.”

The alumni survey makes up 59% of the ranking’s methodology. The FT has removed schools from its ranking, which launched in 1999, but has never removed a school as highly regarded as IE, which placed eighth in the 2017 ranking.

5. INSEAD’s Welcome Week: Healthy Humbling Or Traumatic Hazing

When INSEAD announced this summer that it would no longer be allowing its orientation, Welcome Week, it set off a tremendous outpouring from alums arguing for and against the controversial event. First reported by The Financial Times, two incoming INSEAD students formally filed complaints about hazing to the Comité National Contre le Bizutage, or French National Committee Against Hazing. The INSEAD newcomers charged that the student-run, one-and-a-half day event put incoming students through uncomfortable initiation activities. We reported a similar story and then the comments and emails to P&Qstaff members ignited.

As the school got a first taste of scandal, clear lines were drawn, and camps emerged both for and against the school’s Welcome Week. Among the more prominent voices calling for the event to be restored is Leonid Bershidsky, an INSEAD alum and Bloomberg columnist who wrote an opinion piece in support of the 35-year-old orientation tradition. “Welcome Week definitely got us out of our comfort zone, and I know many of us felt unsettled and, yes, unsafe or at least uncertain about our future at the school and its demands,” Bershidsky wrote in an essay. “Being forced to look at oneself in a harsh mirror held up by one’s peers could be even more traumatic than a 24-hour workout.”

At issue, was the portion of the week when students join student-run clubs that end up being fake. Some of the clubs put students through some embarrassing and excruciating rites of passage before the already enrolled students reveal to the incoming students the clubs are just made up.

One former student recounted her experience to P&Q and claimed she was asked to meet others at the Forest of Fontainebleau, a 110-square-mile national forest that borders INSEAD’s campus and is comprised of a massive maze-like network of trails with few distinguishing features. “I ran for hours. I climbed for hours,” the former student said, describing a scene more akin to a fraternity initiation than a club at a prestigious business school. “The club leaders would scream in our ears, calling us fat Renaissance rejects.”

Either way, the removal of the event certainly got a heated discussion going. For now, at least, future INSEAD students will not be participating in any hazing in Welcome Week.

4. Columbia Business School’s Shocking #MeToo Trial

It wasn’t a good year for Columbia Business School with some shocking sexually-related cases of harassment and abuse. First was the case of a senior professor — Geert Bekaert — who was accused by a junior professor and his mentee of sexual harassment. But what was in extra shocking was how Bekaert handled the allegations. Soon after learning of the accusations of Enrichetta Ravina, he send a blaze of emails to colleagues around the world calling the young professional, Enrichetta Ravina, a fucking evil bitch, crazy, insane, mentally unstable, paranoid, schizophrenic, and berserk. At one point, Bekaert confessed that he wanted to strangle her.

The trial, which eventually led to a $1.25 million payout for Ravina from Columbia’s B-school and Bekaert, was an unraveling of a once promising faculty partnership. Bakaert, who is 11 years older than Ravina, held some power over Ravina and her career at Columbia, where Ravina left before gaining tenure. Ravina accused Bekaert — one of Columbia Business School’s most senior professors — of abusing his power by sexually harassing her for more than a year, and then sabotaging her academic career when she continually fended off his alleged attempts to get her to go to bed with him.

At one point, she claims, Bekaert, who had a major influence over her ability to publish academic research vital to a forthcoming tenure decision, told her: “If you were nicer to me, your papers would move faster.”

“I’m already as nice as I can be,” she said she responded.

The case shown a spotlight on the abuse of power dynamics in the workplace that have become incredibly common and part of a larger national spotlight of the #MeToo movement.

3. Dean Hubbard Weighs In At Court, Calling Dispute A “Soap Opera”

This past July, as the $30 million case between two Columbia Business School professors was taking place, CBS Dean Glen Hubbard testified in court, calling the dispute “disgraceful,” “unprofessional,” and a “soap opera.”

“I’ve been teaching 35 years. I’ve never seen anything like this,” Hubbard told a New York City courtroom in mid-July. “The most common dispute — and even that I could count fingers on one hand — would be a teaching dispute, you know, who developed what materials for class, but I have never had to referee something like this in 35 years of being an economist.”

Hubbard, who has been Columbia B-School’s dean since 2004, was weary to get in the middle of the dispute before it went to court.

“It was serious,” he later testified, “because that involved their professional lack of communication, and I thought it was a soap opera. Sitting here today, I think it.”

2. Columbia’s Sexual Assault Case And The Administration’s Response

Months after the multi-million dollar sexual harassment case between two professors, another serious case of serious sexual misconduct surfaced at Columbia Business School. In November, a first-year MBA student came to P&Q, alleging she and other classmates had been drugged and raped by other full-time MBA students at Columbia. And what the student, Katie Brehm, did in reaction to the brutal attack was incredibly brave and courageous. The 31-year-old young professional wrote an email to the 70 fellow students in Cluster A, one of several groups assigned to take all of the first-year core classes together.

She wrote the Nov. 7th letter as much for clarity as anything else. Brehm had little recollection of what exactly happened the night she was assaulted at a social event celebrating the end of mid-term exams. She decided to rely on the recollections of her classmates and friends. From what she could piece together, Brehm had become convinced that a tall, white male classmate had slipped a date-rape drug into the Bulleit Bourbon she ordered at the bar and taken advantage of her blackout.

That night ended with a sidewalk spill that led to the diagnosis of a concussion, a rape kit assessment in a New York City hospital that found bruises on her inner thighs and vagina, indicating signs of forced penetration, and endless questioning of friends about what exactly happened at a private party attended by hundreds of Columbia Business School students.

“I have been MIA since the Jane Hotel because I am on short-term medical leave,” she told her classmates. “While it is partially for a concussion, it is predominantly because a fellow CBS student has drugged me three times this semester. I have spent the last two weeks in and out of the hospital, NYPD, and Columbia University gender based misconduct offices. At the Jane Hotel, three female students sustained concussions. If you want to believe that is a coincidence, that is your choice. Not only was I drugged, but I was sexually assaulted. I am not letting whoever did this to me get away with it…”

Even more traumatizing and frustrating for Brehm? Columbia’s lack of response to her plea for justice. There was no follow-up from Dean of Students Zelon Crawford after a 20-minute meeting on Nov. 7, shortly after sending the email to her Cluster A classmates. The dean, she says, never even sent a follow-up email or made a phone call to check up on Brehm to make sure she was okay.

She believes the school is protecting and harboring two criminals. ”They have sat on allegations of drug assisted sexual assault for over three weeks,” says Brehm. She recently hired a law firm that is exploring the potential of a civil suit against the school for failing to promptly and adequately deal with her serious charges and to protect her and the other female students at the school. A spokesperson for Columbia Business School declined to comment for the original story.

1. Temple Fox’s Rankings Snafu And Dean’s Eventual Firing

2018 started off with a bad bang for Temple University’s Fox School of Business. After placing first for four consecutive years in the U.S. News ranking of online MBA programs, Temple was left off the list. The reason? Falsifying data. The school had reported a slew of falsified data that would boost their place in the rankings. After a investigation that lasted until July, the school announced Dean M. Moshe Porat, who had been dean of the school for over two decades new about the falsified data.

In the immediate aftermath of that embarrassment, the university hired Jones Day to conduct an investigation.

“It is my duty to report that the Fox School, under the leadership of Dean Moshe Porat, knowingly provided false information to at least one rankings organization about the Online MBA,” wrote Temple President Richard M. Englert. “In addition to the misreporting of the number of students who took the GMAT from 2015 to 2018, the average undergraduate GPA was overstated, and there were inaccuracies in the number of offers of admission as well as in the degree of student indebtedness.”

The Jones Day investigative team interviewed 17 Fox employees and reviewed more than 32,000 documents. It concluded that, over the past several years, “Fox provided U.S. News with inaccurate information across multiple data metrics that are part of the publication’s OMBA rankings methodology. And while Jones Day focused on information that Fox provided to U.S. News relating to the school’s OMBA program, the investigation revealed that Fox provided U.S. News with erroneous information relating to other programs as well. On certain occasions, Fox’s reporting of inaccurate information to U.S. News was done knowingly and intentionally for the purpose of improving or maintaining Fox’s standing in the relevant U.S. News rankings.

The investigation sent shockwaves throughout the entire B-school community as cheating had officially become a thing in business school rankings.

John A. Byrne is editor-in-chief of PoetsandQuants.com, the leading website covering business schools. He is also the former executive editor of Businessweek and former EIC of Fast Company.

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