Who are MBA Rankings for? Not Applicants!

Who are MBA Rankings for? Not Applicants!

Feb, 18, 2026

The FT Rankings recently came out. I will not comment on those rankings in full detail, but refer to them. If you want to know about them in detail, see John Byrne’s recent article in P&Q. He does a thorough job of analyzing those rankings and how they are formulated. Instead what I want to ask is another question, which is who are MBA rankings are for?

 

While some might think they are for applicants to determine where to apply, I think rankings are primarily of benefit to the news organizations that create rankings, business schools, alumni, and, marginally, current students.  They are the actual stakeholders in rankings, not applicants.

 

Applicants are potential customers determining what program to invest their time and money in. They have no pre-admission stake in a particular school, they are not stakeholders as such. Their calculations for where to go, beyond the consideration of where they have a good chance of getting admitted to, should be based on ROI, which can be partially  determined by looking at official post-MBA reported salaries and recruiting data. Such data, while imperfect, is inherently better than anything self-reported by alumni, which is where FT, for example derives its data.  Other factors that impact school selection include curriculum, school culture, location, and reputation in the geographical location or locations where an  applicant intends to be living and working after their MBA.  These factors cannot be determined by looking at any ranking, but require research and networking (and ideally school visits).  As with any purchase, caveat emptor (buyer beware) is always the rule.

 

It is obvious that FT’s rankings should not be taken very seriously by applicants. Stanford GBS opted out of FT Rankings and could easily opt out of all rankings forever. It would not impact the fact that Stanford is the hardest MBA program to get into and the school whose graduates have the highest starting salaries. Starting salary= actual market value of a degree.  If applicants want to make economically rational decisions about what school will give them the highest compensation, they should look at official starting salary and other recruiting data. That is not to say that starting salary alone should be the determination of where to attend as I have indicated above.

 

It is common for those thinking about getting an MBA to have very limited information about programs. I have been a graduate admissions consultant since 2001 and focused primarily on MBA admissions since 2007. The one thing I can tell you is that many applicants have poor information about programs when they start the application process. This is totally reasonable. When someone is thinking about getting an MBA, they are often in the information gathering phase. They come in with limited information and only know of certain programs.  They might have no idea about which programs they could get admitted to and/or which programs are right for them given their career or life objectives. Part of my job is often to help clients figure that out.  Cutting through both positive and negative stereotypes about programs and  providing a pathway for understanding which programs align with a particular client is what I do.  Applicants can certainly do that themselves by becoming informed about programs. The best thing  about any rankings table is that it is a checklist of programs to look at, but the rankings themselves really don’t provide a good indicator of where a particular applicant should apply.

 

Now that we disposed of applicants, let’s move onto who rankings are actually for.

 

Rankings are for those who have an interest in ranking.

 

Let’s begin with the origins of ranking. Ranking is not being done by objective ratings agencies with zero interest. They are being done by paid staff at news organizations. News organizations generate readership and revenue by generating news. For rankings to be newsworthy, they should be dynamic. FT has such dynamic rankings based on its popularity contest  methodology that its rankings are not stable year-to-year.  When a ranking has massive annual changes, you have a great method for generating news. What is nice for news organizations is that rankings are dependable story that they create. They literally make the news and don’t have to find it. Instead they create the methods for generating rankings (no news organizations use the same rankings) in the hope that readers will engage with those rankings. Rankings generate news, news generates ad and subscription revenue.  This is not bad thing, but it is important to look at rankings as part of journalism and not something objective or being done without institutional interest.

 

Rankings also reflect the institutional interests of the business schools that benefit from getting ranked higher.  If you are a dean at a business school whose ranking improves you get something to brag about, you can use it raise more money from alumni, negotiate a higher salary for yourself (or at least not get replaced),  send out messages of congratulation to staff, students, and alumni.  I  have a Masters  (not an MBA) from INSEAD (Rank #2 in FT) and received said email.  I don’t blame any Dean for celebrating said result. After all, it is always nice to be recognized and get an “award.”  Rankings are great for marketing purposes and clearly it is an an institutions interest to generate high rankings for purposes of recruiting. Business schools must generate tuition and/or fill seats. They are generally non-profit organizations and rely to a greater or lesser extent on tuition.  However they all rely on having students.  Schools provide admission to students that they have selected, but in order to be selective (or appear to be selective), they have to get as many applicants as possible.  Rankings are great because they can interest potential applicants in a school, especially consumers with low information.  The reason schools participate in this process is get a higher ranking if possible. At minimum being unranked for all but the top programs will hurt when conducting marketing amongst low information applicants.  Higher rankings, no doubt, generate more applications or at least create the possibility of doing so.

 

The FT ranking system, relying heavily on alumni self-reporting of compensation, is unique because it manages to join the interest of alumni with their schools. After all,  everyone wants to have graduated from as  high ranking program if possible. And certainly a school that improves its ranking looks better externally than one that has gone down in rank.  In as much as people  into the institutions that they will forever be connected to in terms of their backgrounds, alumni are invested in seeing their school’s ranking improve.  But this carries a potential risk to the quality of the information be gathered that John makes very clear:

“The heavily weighted compensation data — accounting for 32% of the ranking — is taken from its alumni surveys even though alumni have every incentive to inflate their pay knowing that it will impact the rank of their alma maters. Other rankings use pay data provided by schools that adhere to rigorous reporting standards.”

 

Hence FT has a created a non-verified system that counts for 32% of its ranking. This is totally unreliable data that no one making a real business decision, such as what MBA program to attend, should take seriously. However it is a great way for alumni to support their alma mater and ideally make themselves feel good in the process if their school is highly ranked.

 

Rankings might, on the margins, benefit current students, if recruiters take these rankings seriously or even look at them, which I frankly doubt (Happy to be proved wrong about this).  That said, a current student whose school’s ranking improved can feel that they made the right choice. Hopefully that ranking will reflect on their future careers and compensation as well. But rather than ranking, current students are presumably much more concerned with recruiting.

 

Finally, my purpose in writing the above is not to criticize those who have an interest in ranking, but rather to point out that those interests don’t necessarily align with applicants’ interest. I certainly have a direct interest as well: I want to help clients get into the right program for themselves because by doing so, I do my job and have a satisfied client. Satisfied clients provide referrals to me. That is in my interest.