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Indian School of Business Gains AACSB Approval

The Indian School of Business (ISB) became the first business school in South Asia to be accredited by the Association to Advance Collegiate Schools of Business (AACSB). The Hyderabad-based school, now celebrating its 10th-year anniversary, made the announcement today (Dec. 2.)

The AACSB’s imprimatur has been earned by some 643 of the world’s business schools–less than five percent of the total–and is generally considered an important step toward quality for any serious business school. ISB was among a batch of six schools gaining accreditation. The others are Kyungpook National University in Korea, National Cheng Kung University and Yuan Ze University, both in Chinese Taipei, SDA Bocconi in Italy, and Stonehill College in Easton, Mass.

“We are delighted to have received the prestigious AACSB accreditation,” said ISB Dean Ajit Rangnekar in a statement. “Given our commitment to creating research-based knowledge, and developing leaders through innovative world-class programmes, we are delighted to have this robust and independent reaffirmation of our adherence to our mission.”

The accreditation also comes at an opportune time–in one of the most traumatic years in the short history of the school. The institution saw one of its key founders, former McKinsey & Co. Managing Director Rajat Gupta, become embroiled in a massive insider trading scandal in the U.S. that led to Gupta’s resignation as chairman of the school in March. ISB was Gupta’s brainchild, and it was he who brought the academic brains and the corporate forces together to establish the school in 2001. The same case also claimed another prominent ISB board member, Anil Kumar, who has pleaded guilty to securities fraud.

With those events now put behind the school, Dean Rangnekar said he is confident that the AACSB recognition “will translate into increased interest by the international community comprising of faculty, students and recruiters, and help us chart Asia’s and India’s growth as the global management education hub.”

After a ten-year run, the school still has not been able to attract a highly diverse student population. Only 5.5% of the Class of 2012 is composed of non-Indian passport holders and only 29% of the students are female. What’s more, nearly a third of the students come from the Indian Institutes of Technology alone. But the class has a respectable median GMAT of 710, and graduates of its one-year business program have done exceptionally well in the job market. This year 310 companies made 661 job offers to ISB’s graduates who pulled down average starting salaries of $121,008, for international positions outside India, roughly 2.3 times their incoming salary. If a graduate stayed in India, the average pay was considerably lower.

Perhaps the biggest affirmation of ISB’s reputation came when it finally broke into the Financial Times ranking at No 20 in 2008 (it ranked at No 13 in this year’s 2011 rankings). “Most people could never even imagine that in our seventh or eighth year we would get into the Top 20 rankings,” Rangnekar told Poets&Quants in an earlier interview.. “I think we did everything we could do but we were enormously helped by the fact that the Indian economy itself went through the roof.”

Accreditation by the AASCB is yet another important step in building the school’s reputation. “The AACSB Accreditation is yet another feather in the cap of ISB, adding to its spectacular track record of success and growth,” added school Chairman Adi Godrej in a statement. “The fact that this external endorsement of the school’s quality has come on its tenth anniversary, makes it even more eventful.”

The school said that achieving AACSB accreditation is a process of rigorous internal review, evaluation, and adjustment. Over the years, ISB has developed and implemented a plan to meet the AACSB accreditation standards, which requires a high quality teaching environment, a commitment to continuous improvement, and curricula responsive to the needs of businesses.