1/14/2020 0 Comments
The Ethics of Student-Faculty Business Deals The Akamai Corporation has meant big money for one Massachusetts Institute of Technology professor and one of his students. Back in 1995, Tom Leighton, a professor of applied mathematics at MIT, started playing around with ways to use complex algorithms to ease congestion on the Web. He enlisted several researchers, including one of his graduate students, Danny Lewin. At the time, they weren't thinking about starting a company. But Mr. Lewin, following the keen instincts of a cash-strapped graduate student, suggested they enter the project in the Sloan School's annual business-plan competition. They won the software category in the preliminary round and then entered the finals, where they finished among the top six. Mr. Leighton and Mr. Lewin were still interested in the technology mainly as an academic exercise, but the possibility that their work could have real-world applications pulled them inevitably into business. They launched Akamai Technologies Inc. in the fall of 1998, and took it public the following October. Opening day saw the stock soar from $26 a share to more than $145, giving the company a day-one market cap of $13.13 billion. This sounds like a great business venture, but there still is a small problem. Mr. Lewin was one of Mr. Leighton's students when they formed the Akamai Company. This brings about the moral question of the case. Should students and professors be allowed to start companies together? Although there is no clear answer, there is widespread agreement among administrators that schools need to address the question. As a result, many M.B.A. programs are in the process of reviewing and, in many cases, implementing policies and guidelines governing student-professor business collaborations. The burden of this moral question falls mostly on professors since student is not an establish profession and thereby has no formal code of ethics. On one side of the issue are those who point to ethical considerations and insist that schools can't tolerate the possibility that students may perceive any conflict of interest on the part of a professor. On the other side are those who've invested substantial time and money in a business-school education specifically to gain access to professors. These people donâ€™t want to consider any restriction on their ability to conduct their business lives as they see fit. Caught in the middle are administrators, who must protect their schools' academic integrity while trying to accommodate students and faculty alike.