The Virtuous Circle of the Rankings and Business Schools

By Xénia Guardia, Rankings & Accreditations manager at ESADE

A few weeks ago, The Financial Times published its annual ranking of the world’s top MBA programmes.

One of the world’s oldest business school rankings, today it remains both the most important ranking for FT and one of the most important in the world. A quick look back shows why.

In the late 19th century, various American companies made the first donations to universities to have them train their engineers in business management. As a result, the first business schools were founded, institutions such as Harvard and Wharton. Over the next 50 years, some 10,000 more business schools offering this type of programme, known as an MBA, were founded around the world.

In the late 20th century, the need to regulate this offering gave rise to various accrediting agencies (AACSB, EFMD, etc.), and some 1,000 schools were accredited.

Although originally these schools had targeted local, highly captive audiences, by the late 20th century, the global panorama had changed. The world was witnessing a wave of globalization, a technological revolution.

Schools suddenly found themselves catering to global, mobile audiences and their teaching methods evolved. However, the schools also had very small budgets. The media viewed this as an opportunity to create a useful tool both for this new audience and for the schools themselves, one that would allow them to publicize themselves anywhere in the world, despite their modest budgets: rankings.

Business Week launched a ranking for the US. It was followed shortly after by The Financial Times, which launched a second ranking, at the global level.

The ranks of schools continued to be whittled down in multiples of 10. Of the 10,000 schools, 1,000 were accredited. Of those, 100 were included in the ranking. Within the ranking, the most important thing was to be among the best.

In the following years, future students gave considerable weight to these rankings when prospecting for new schools, giving rise to a virtuous circle. The higher its ranking, the more talent a school was able to recruit (in terms of both students and faculty). This enriched the educational experience, grew networks, and enhanced graduates’ career prospects and salaries, all of which helped to boost the school further in the rankings, thereby beginning the circle anew.

In 2011, AACSB published a report ("Globalization of Management Education") showing that a Top-20 ranking considerably increased both the number of applications received by an MBA programme and the final enrolment rate. 

What does The Financial Times look at?

Alumni careers, diversity and knowledge are the three main pillars of the Financial Times ranking.

The Financial Times uses the impact the MBA has on alumni’s careers to gauge a programme’s quality. To that end, it asks graduates about their salaries, career progress and aim achievement three years on. Three years is considered a sufficient window of time for graduates to evaluate the usefulness of the knowledge and skills they developed in the programme with regard to their personal and professional development. Importance is also given to the tools schools offer alumni to help them enhance their careers and start their own businesses.

Another major variable that The Financial Times takes into account is schools’ capacity to generate knowledge, as research leads to innovation, both in the classroom and in business management.

Finally, diversity is used as a quality indicator in terms of graduates' ability to thrive in any global environment. It is primarily assessed in terms of gender and international diversity in the classroom, with regard to both faculty and students; the international experience that programmes offer students; international mobility; etc.

The Financial Times then uses all of these variables, along with schools’ positions in the previous two rankings, to calculate the new ranking of participating institutions.

Is ESADE one of the best schools?

ESADE is one of the Top 20 schools in the world that offer an MBA. This is a major milestone and one we hope to further consolidate in the coming years.

ESADE began the process in the mid-20th century, along with 9,999 other schools. Forty years later, its mission and values already included the quality and internationalization of its programmes, allowing it, in 1994, to earn its first international accreditation, from The Association of MBAs (AMBA). Four years later, the entire school was EQUIS-accredited (accreditation awarded by the European Foundation for Management Development (EFMD). Finally, it received its first American accreditation from the Association to Advance Collegiate Schools of Business (AASCB).

Shortly after, we participated in the FT MBA ranking, placing in the second half of the list.

Since that first edition, ESADE has internationalized and its MBA programme has steadily improved its standing. In the latest edition, we were included in the world’s Top 20 business schools, and we are ranked among the Top 10 on variables such as Career Progress, International Experience and Diversity.

This result bears witness to the success of the global, multicultural and digital approach towards executive training that increasingly characterizes ESADE’s programmes.