Over a year ago, I considered the then newly-named dean of the Harvard Business School, Nitin Nohria. He’s been an outspoken critic of MBA curriculum that fosters short-term thinking at the expense of ethics and long-term values.
Nohria’s appointment came after the economic collapse of 2008 caused many to rethink what I call the MBA mentality of misguided metrics. Business school faculty worried that they’d taught too narrowly — emphasizing the need to maximize short-term profits at the expense of important but less easily measured values. Some suggested that business management should become more like a profession, such as medicine or, ahem, law.
Unfortunately, the most visible and powerful segment of the legal profession — big law — had already evolved to mimic some of the business world’s worst features. Nohria would have to look elsewhere for guidance.
So I read with interest his recent Q&A in the Wall Street Journal. Ethics has been a centerpiece of his curriculum overhaul at Harvard. But he’s even more concerned that this new classroom emphasis won’t stick once students return to the workforce.
“[T]here seems to be a big difference between people’s understanding of their responsibilities as business leaders and their capacity to live up to those when faced with pressure or temptation,” he told the Journal.
Because those achieving power have more difficulty retaining their moral compasses, Nohria’s new mission is cultivating humility.
“Abraham Lincoln said people think that the real test of a person’s character is how they deal with adversity,” Nohria told the Journal. “A much better measure of a person’s character is to give them power. I’ve been more often disappointed with how people’s character is revealed when they’ve been given power.”
“Now for the bad news, which concerns what happens when all those nice guys actually get in power. While a little compassion might help us climb the social ladder, once we’re at the top we end up morphing into a very different kind of beast.”
What does this have to do with lawyers? Plenty, especially most of those who run big firms where power has become concentrated increasingly at the top.
“Before the recession,” one management consultant observed, the top-to-bottom ratio within equity partnerships “was typically five-to-one in many firms. Very often today, we’re seeing that spread at 10-to-1, even 12-to-1.”
Several months ago, one big firm leader offered the Journal this spin:
“Pay spreads widen as firms become more geographically diverse, operating in cities with varying costs of living, said Peter Kalis, chairman of K&L Gates. The firm’s pay spread rose from about 5-to-1 to as much as 9-to-1 in the past decade as it expanded. ‘Houses cost less in Pittsburgh than they do in London,’ Mr. Kalis said.”
It’s a nice soundbite, but for reasons I’ve outlined before, not particularly persuasive. (E.g., Are there no top-of-the-range equity partners at K&L Gates’ Pittsburgh headquarters?)
But here’s the larger point: K&L Gates ranked 105th out of 126 firms in The American Lawyer 2011 Mid-Level Associate Survey. The firm scored well below the national averages in morale, collegiality, associate relations, training and guidance, family-friendliness, and overall rating as a place to work.
Kalis deserves praise for inviting recruits seeking jobs at his firm to ask tough questions. They won’t pose this one, but any leader should consider it:
While those at the top of big firms have consolidated their wealth and power, does true leadership — measured by the positive energy that everyone else in the place exudes — seem absent in a lot of them?
If Nohria is correct that the test of character comes when a person gains power, many at the top of some big firms could do better. Then again, it all depends on the metrics by which they’re measured.