Were business schools to blame for the 2008 financial crisis?

The Wits Business School will host what promises to be a fascinating lecture by Professor Jonathan Michie from Oxford University.

In 1989 American political scientist and author Francis Fukuyama declared ‘the end of history’, with the fall of the Berlin Wall and the imminent collapse of the Soviet Union.

The apparent triumph of capitalism led to, or at least encouraged and facilitated a global era of ‘Washington Consensus’ policies of privatisation, deregulation, demutualisation and financialisation.

Business schools generally taught the benefits of such ‘free market’ policies and processes. This included tying senior compensation packages to share prices, which both introduced an incentive to inflate those share prices, and helped exacerbate a huge growth in top pay.

Despite repeated financial and economic crises across the globe during this 1989-2007-era, this practice was generally lauded as a successful economic model globally. However, in 2007-2008 it led to a global financial crisis, and, in 2009, the first global recession since the 1930s.

Were the ‘Washington Consensus’ and ‘free market’ policies to blame? And were business schools guilty of promoting the policies, mind-sets, corporate cultures and practices that contributed to the crisis?

The Wits Business School will host what promises to be a fascinating lecture by Jonathan Michie, Professor of Innovation and Knowledge Exchange, Oxford University, as he considers the role business schools played in the 2008 financial crisis. Booking is essential. Follow the lecture on twitter via @witsbschool or #witstalk.

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