Should You Trust the Financial Times MBA Rankings?

Note on the 2023-2024 Financial Times MBA Ranking

As global MBA rankings go, the Financial Times’ is somewhat of a gold standard, especially since The Economist’s controversial ranking was discontinued last year. In the current ranking landscape the FT’s ranking stands out because it is the only major one remaining to rank top full-time MBA programs globally, while other publications tend to split international programs from US ones. The other particularity of the FT ranking, which I very much applaud, is that schools are being audited (by KPMG) on the data they contribute. My past life as external and internal auditor has taught me not to trust data that are not independently verified. This is very much relevant in an international context, where pressure from domestic competitors may be inexistent in certain countries (as opposed to the US) and cultural attitudes towards what constitutes accurate information may vary.

Rankings are often controversial, and this year’s FT ranking was no different. A lot of ink has been and will continue being spilled on the FT’s new ranking methodology, and LinkedIn is awash with self-congratulatory posts of current students, alumni, staff and faculty of programs making incursions into air thinner than they are accustomed to. As every year, critics are quick to point out that by placing significant weight on international diversity the ranking favors non-US programs. And, also like every year, the FT is just as quick to point out that the ranking is largely dominated by US schools. This year’s edition, no matter what one may think of INSEAD and IESE ranking higher than HBS and GSB, is led by CBS in pole position, and 13 US schools in what the FT considers the top tier of 18 ranked programs. Finally, and this too happens every year, there is no shortage of well-meant recommendations to take rankings with a pinch of salt. There is no doubt in anyone’s mind, for example, that Wharton’s MBA, which has been excluded from this year’s edition for technical reasons, is one of the world’s very best, seeing indeed that is has claimed the top spot of this particular ranking 9 times in the 25 years it has been running.

This brings me to the most interesting and perhaps most overlooked bit of information just released by the FT. As part of the related lead article, “Global MBA ranking 2023: change at the top” comes a table recapitulating the top 10 of MBA programs as ranked over the past 25 years. This simple analysis is striking in how uncontroversial it is, confirming rough yet time-tested assumptions made either side of the Atlantic about what the top programs are: the M7 in the US, and INSEAD, LBS and IESE internationally. Regardless of what you may think about the top 3 non-US program’s worth compared to non-M7 schools, it is still remarkable that over 25 years of painstaking number-crunching, auditing and methodology-tweaking, the Financial Times would come up with an aggregate ranking that pretty closely emulates market consensus for US and international programs. This in turn strengthens both my respect for the FT as an MBA ranking publication, and my lack of interest for rankings in general. It seems to hardly matter where a schools rank at any given time. Watch the long-term trends.

Pascal Michels
Pascal Michels, M.B.A.
Sr. Consultant & Director

The 2024 Global MBA ranking by the Financial Times goes beyond US business schools to compare some 132 MBA programs from all over the world. This broad perspective is welcome, especially by international applicants. Unfortunately, it is this same global focus that poses problems for the objectivity of the ranking, and any applicant looking to the Financial Times for guidance should keep the following observations in mind when consulting the list.

And meanwhile, if you want a stable list of the long-term leaders in MBA education, see our directory of top MBA programs, which doesn’t focus on a ranking formula, but on the factors that make each program valuable to students.

How the Financial Times Creates Their Global MBA Rankings

The Financial Times gathers its data according to the following breakdown:

  • Student Survey/Alumni Responses – 56%
  • School Data – 34%
  • Research – 10%

From this breakdown, one might conclude that this ranking is mostly based on qualitative data instead of quantitative data, but that is not the case. A large part of the student survey consists of questions about pre- and post-MBA salaries and only a small percentage (7% of the total ranking) is qualitative. This qualitative part consists of two questions:

  • Have the alumni fulfilled their stated goals or reasons for doing an MBA?
  • How effective is the school’s careers service in terms of career counselling, personal development, networking events, internship search and recruitment, as rated by their alumni?

The student survey is filled out by graduates three years after they obtained their MBA; the responses from 2024, 2023, and 2022 were used in the most recent ranking. The school data portion of the ranking measures how well the school does on gender equality, how international the school is, and what percentage of the faculty has a doctoral degree.

The Research category is unique to the Financial Times ranking, measuring the number of articles published by faculty-staff in 50 selected academic and practitioner journals, corrected for the size of the faculty. The quality or importance of the publications is not taken into account.

Financial Times MBA Rankings, 2024
1.UPenn Wharton
3.SDA Bocconi School of Management
6.MIT Sloan
8.London Business School
9.Cornell Johnson
10.Chicago Booth
11.Harvard Business School
12.HEC Paris
12.Dartmouth Tuck
14.Duke Fuqua
15.Yale SOM
16.UVA Darden
17.Esade Business School
18.UCLA Anderson
19.Berkeley Haas
20.IE Business School
21.NYU Stern
23.Stanford GSB
24.Shanghai University of Finance and Economics
25.ESCP Business School

Changes to the 2024 Financial Times Ranking Methodology

In recent years, the ranking had included a further qualitative “alumni recommend” category, which required alumni to recommend three other business schools (aside from their own) from which they would most consider recruiting. This category had been worth 3 percentage points. Further, the Financial Times MBA Ranking methodology formerly included an “extra languages” rank, which awarded credit to schools whose program requirements involve learning an additional language (outside of English) by graduation. This was worth 1% of the overall ranking.

In addition to the removal of the “alumni recommend” and the “extra languages” ranks, which previously accounted for 4 total percentage points, the 2024 ranking includes two new metrics in their methodology:

The ESG rank is based on the coverage of ESG topics within core courses by teaching hours as well as how much time is dedicated to instructing on how organizations can reach net zero. Further, alumni evaluated their school’s ESG teachings.

The Carbon Footprint rank credits schools with “a carbon emissions audit report that includes Scope 3 emissions (those not controlled by the school but which occur externally in its value chain as a result of its activities).

For additional information on these changes, take a look at the official Financial Times 2024 Ranking Methodology.

General Observations

Although the qualitative component of the Financial Times ranking makes up only a small portion of the overall score and does not exert too strong of an influence on the final result, it is still worth noting that the results of any student survey will always be arbitrary.

Consider this: when asking students to rank their school, they will have nothing to compare their school against. After all, they are not attending multiple programs at once! And not only are they unable to grade their program relative to another, but their feedback is also relative to their expectations. A student at a top 5 school, for example, expects an amazing experience based on the prestige of the program. If their experience turns out to be “great” instead of amazing, the student might give their school a lower score than someone who expects a “good” experience but receives a great one.

The student survey is also complicated by the fact that the group of respondents is very diverse. The final rankings contain many non-US schools, meaning that the survey is filled out by graduates from schools in Europe, Asia, and Australia. Imagine the response when the Financial Times asks a graduate from the Melbourne School of Business to rank their top three business schools and the schools from which they would recruit: isn’t that alumnus going to name their own school and two other Australian business schools, rather than taking the objective, global perspective?

In terms of quantitative data, the Financial Times treats various metrics differently than other ranking bodies. Instead of focusing on GMAT scores and GPAs, the Financial Times looks at diversity, both in gender and in nationality. It’s a fresh approach, and rewarding the international character of a school might make this ranking interesting for some. But in general, it will favor non-US schools, as they tend to have a more diverse student- and faculty-set—especially the European schools.

Non-US schools are favored in a more significant way by how the Financial Times factors compensation into their ranking. The Financial Times corrects the average salary of the alumni using the US$ purchasing power parity (PPP) equivalent. Schools that have a high number of alumni in lower income countries (typically non-US schools) are therefore disproportionally favored.

All in all then, it isn’t a surprise that INSEAD ranks second on the full Financial Times Global MBA 2024 ranking despite not featuring on many others.

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Financial Times vs. U.S. News

When consulting rankings, the potential MBA applicant may be struck by the dramatic differences between the lists. How can a school rise and fall so markedly across rankings that are presumably measuring the same thing?

By analyzing specific entries from different rankings, we see how these lists do not measure the same thing at all: wildly inconsistent methodologies lead to wildly inconsistent results. We also begin to see how, for each ranking, the arbitrary decision to highlight one aspect of the MBA experience will favor certain programs and penalize others.

In previous years, drawing comparisons between the Financial Times and The Economist allowed for a fairer demonstration of the discrepancies between rankings, as both rankings were internationally focused. However, with the discontinuation of The Economist‘s ranking in 2022, it is most illustrative to compare the 2024 U.S. News and Financial Times rankings. We strongly recommend taking a look at our full analysis of the U.S. News 2024 MBA Ranking.

Among the primary differences separating the two publications, the source of information varies significantly between the U.S. News and Financial Times rankings. While school data accounts for 34% of the Financial Times‘ overall ranking, this is the primary contributing factor to the U.S. News‘ ranking (75%). Further, while median GMAT and GRE scores account for 13% of the U.S. News‘ overall ranking, this metric is not considered in the Financial Times‘ ranking methodology.

These differences in approach have led to some very interesting discrepancies with the Financial Times listing:

U.S. News ranking 2024Financial Times ranking 2024
UPenn Wharton3rd1st
NYU Stern10th21st
Stanford GSB6th23rd

Aside from the schools being ranked (US vs International), the differences in the 2024 rankings can largely be attributed to each respective ranking’s primary area of interest. While the Financial Times looks to the career outcomes of MBA graduates most closely, the U.S. News ranking is more interested in the profile of the incoming MBA class at each business school. Of course, the quality of an MBA class is a fairly accurate predictor of future career success.

Regardless of the methodology being employed, however, certain standings in these rankings are ludicrous. Starting salaries for Stanford GSB and Harvard Business Schools graduates are consistently higher than any other business school worldwide, which is a huge consideration for MBA applicants when evaluating the ROI of an MBA degree. Despite the cultural climate, which increasingly values ESG initiatives and diversity metrics, starting salaries are likely to be a more significant factor in an MBA applicant’s decision to enroll in a given MBA program.

Further, some data points simply cannot take into account the name recognition of a Stanford GSB or HBS MBA. For example, employment at graduation (which accounts for 10% of the U.S. News‘ ranking and 0% of the Financial Times’ ranking) and employment three months after graduation (which accounts for 20% of the U.S. News‘ ranking and only 2% of the Financial Times‘ ranking) is a useful metric for schools without the Harvard or Stanford MBA brand, where on-campus recruitment will be a major draw for prospective MBA students. However, the lack of a post-MBA position for HBS or GSB graduates could equally speak to the confidence and security that comes with the degree: HBS and GSB graduates have stronger negotiating power in recruitment conversations and can therefore hold out until the best offer is made.

Financial Times MBA Rankings: Key Takeaways

While it is a laudable goal to publish a list of international business schools, giving all programs an equal opportunity to compete for top positions, the reality is that the Financial Times favors non-US programs through an unfair and out-of-context salary metric. For this reason, we do not feel that all entries in the “top 25” have truly earned their position. However, when it comes to international MBA rankings, the Financial Times is something of a “gold standard” and is more trustworthy than any other international ranking currently in publication, particularly for candidates solely interested in diversity or the international quality of a business school. (For further discussion on the criteria that influence international MBA rankings, we recommend reading our analysis of the Economist MBA Rankings, despite the ranking’s 2022 discontinuation.)

So How Can You Find the Best MBA Program (Without Rankings)?

Once you determine roughly which schools you are qualified to attend—and the rankings can definitely factor into this initial list—we encourage you to leave the rankings behind and instead focus on the practical questions that will help you figure out which MBA program will provide value to your career. These are simple, practical questions:

Answering these questions will help you find the right MBA program that can enhance your career.

Navigate through the intricacies of MBA rankings with our expert MBA consultants and gain clarity on your journey towards Stanford GSB and beyond.