Cheating and Pension Land

In "MBA students are 'biggest cheats'" Financial Times reporter Della Bradshaw conveys disappointing survey results that graduate students cheat. Business ranks first with fifty-six percent of those polled "admitting to misdemeanours such as using crib notes in exams, plagiarism and downloading essays from the web."

The news is not good elsewhere on campus. The survey, soon to be published in the Academy of Management Learning and Education journal, reveals that fifty-four percent of engineering students and fifty percent of science majors admit to cheating. Thirty-nine per cent of respondents in the humanities say "I do".

According to a report of the Ethics Education Task Force to the AACSB's International Board of Directors, "many schools have initiated new ethics instruction" but "more work must be done." (Note: The Association to Advance Collegiate Schools of Business is self-described as a "not-for-profit corporation of educational institutions, corporations and other organizations devoted to the promotion and improvement of higher education in business administration and management.")

Having taught the occasional MBA or executive MBA course, my experience has been positive (in fact extremely positive in terms of student motivation and integrity). That said, if the survey results hold true, some faculty members, somewhere, are either doing a lot of looking the other way or simply not catching the wrongdoers.

So why is this outcome something to ponder in pension land?

Pensions are set up as trusts. Stewards in charge of retirement plans are entrusted to make good decision on behalf of beneficiaries. Fiduciary duties speak to trust and loyalty. Employees trust that promises made will be kept.

Not every graduate student cheats and to imply otherwise would be grossly unjust. However, a culture of cheating does not bode well if future leaders are pulled from their ranks.

Who is responsible for ethical behavior and when does it start? How can we ensure that pension trustees and other fiduciaries are trustworthy, not just being honest but taking their responsibilities seriously?

Are there lots of capable and high integrity fiduciaries? Absolutely? Are there some who are ethically challenged? What do you think?

How can market participants self-police? How can we make good ethics the voluntary standard (assuming it is not already the case)? How can the system reward the good guys and gals and weed out the others? At the very least, what system best avoids penalizing fiduciaries when they try to do what they think is right, even if it means upsetting the apple cart? What is the role of regulation? What is the role of market structure in terms of transparency?

These and many other questions deserve a vigorous debate.

"What is left when honor is lost?"
Publilius Syrus posted by Susan Mangiero at 9/21/2006 12:30:00 AM