The Financial Times (FT) has released its 2021 global MBA ranking amid an increasing demand for the degree as business professionals seek to invest in themselves during the pandemic.
This year’s ranking revealed a change at the top, with two European schools occupying the first two spots.
Europe tops the list
INSEAD (France, Singapore) and London Business School (UK) ranked first and second, respectively, followed by Chicago: Booth (US) in third place. Ilian Mihov, dean of INSEAD, said: “This ranking captures many of the key aspects of high quality business schools . . . We are particularly pleased to see how INSEAD has advanced significantly in the research ranking and in our gender diversity statistics.”
In an unusual year characterised by the Covid-19 pandemic, data gathering was difficult, FT said. This led to some US schools, including Harvard Business School, Stanford Graduate School of Business and the Wharton School, being unable to participate. Yet, the US schools that took part in the ranking maintained their strong position, partly because of the high salaries of their alumni. Half of the 100 schools in the ranking are based in the US, including half of the top 14.
MBA market booming
The coronavirus pandemic has boosted the MBA market. Traditionally, business professionals see business schools as a shelter from a difficult job market and a launchpad for future career growth. One reason is that the "opportunity cost", which includes the money lost by not entering the job market, is much smaller when the economy is struggling.
The Financial Times reported that the salaries of alumni remained resilient when they were surveyed from September to October 2020. Weighted salaries of alumni from the ranked schools rose 1% on average in autumn 2020 compared with the corresponding period a year earlier.
Student demand for full-time MBA programmes in the 2020/21 academic year shot up 72%, the Graduate Management Admissions Council (GMAC) said. Many schools reported record numbers. Warwick Business School at the University of Warwick (UK) received a whopping 56% more applications compared to last year and expanded its intake by 15%.
How is the ranking created?
The Financial Times Global MBA Ranking is published at the beginning of every year and features the world’s best 100 full-time MBA programmes. To be eligible for inclusion in the ranking, schools must be accredited by EQUIS or the AACSB. A total of 143 schools took part in the 2021 edition.
The ranking has 20 different criteria. Alumni opinion plays a major role across all Financial Times rankings. The newspaper surveys alumni three years after completing their MBA. Their responses are tied to eight criteria (average income three years after graduation, salary increase compared with pre-MBA salary, etc.) that together contribute 61% of the ranking’s weight. The ranking also calculates “value for money” for each school by dividing average alumni salary three years after graduation by the MBA’s total cost including tuition, opportunity cost, and other expenses.
Eleven criteria are calculated from school data, accounting for 29% of the ranking. School criteria include the diversity of the staff, board members, and students by gender and nationality, and the extent to which the MBA succeeds in attracting an international cohort. For gender criteria, schools with a 50/50 composition score highest.
The remaining criterion, the research rank, counts for 10%.
Access MBA advises business school aspirants to gain an in-depth understanding of the methodology behind each ranking before deciding whether what it measures should actually impact their MBA selection and in what way.