IMD, LBS Top Forbes’ Global MBA Ranking

The IMD campus in Lausanne, Switzerland

Wharton’s No. 1 victory in the new 2017 ranking of the best U.S. MBA programs by Forbes wasn’t the only surprise on the new list. The other big upset occurred on the magazine’s ranking of one-year MBA programs. IMD, the school that has a single intake of 90 students a year, was named best over INSEAD.

IMD, based in Lausanne, Switzerland, pushed aside INSEAD, which won two years ago, to gain the one-year crown on Forbes return-on-investment calculations. More surprising, perhaps, was that on an ROI basis, it wasn’t even close. IMD’s five-year gain on an MBA, the sole basis of the Forbes ranking, was $194,700. That’s $44,300 more than INSEAD’s five-year gain of $150,400.

Even more surprising was that the five-year gains of many peer programs after INSEAD was so close as to be statistically meaningless. No. 3 IE Business School in Spain had a gain of $145,400, less than $5,000 under INSEAD. No. 4 Cambridge Judge Business School was at $140,000, little more than $5,000 under IE. No. 5 SDA Bocconi in Italy posted a five-year gain on the degree of $138,100, less than $2,000 under Cambridge.

IMD’s program also had the shortest payback period of any ranked MBA program in the world by Forbes: A quick 2.3 years, with MBAs in the Class of 2012 earning median compensation of $215,000 five years after graduation. That level of pay, Forbes estimates, is more than any other non-U.S. school and just $10,000 below the pay of Wharton MBAs whose payback on the MBA is 3.8 years. The five-year gain for Wharton MBAs, by the way, was nearly $100,000 lower: $97,100 vs. $194,700. That is the more immediate dollar-and-cents advantage of a one-year MBA program.

Of course, students who take a 10-or-12 month MBA program only lose one year of compensation which quickens their immediate returns. And Forbes’ methodology, which fails to account for the internship pay a two-year MBA would receive, tends to overstate both the five-year gain and payback periods of one-year options. Wharton MBAs who interned at consulting firms over the summer, for example, earned $26,000 for their work.


Entrance to the London Business School

London Business School, meantime, topped Forbes’ ranking of two-year-long, non-U.S. programs for the fifth time in a row. LBS’ two-year program, moreover, boasted a five-year gain on the degree of $119,100, highest of any two-year program in the world, with a payback period of 3.4 years on the investment.

The value of the MBA from a non-U.S. school, at least as measured by Forbes, is without question. Graduates from the best international two-year business schools  ranked by the magazine had an average five-year gain of $74,300, nearly 50% higher than MBAs of two-year business schools in the U.S. who saw average gains of just $50,000. That comparison, however, includes a larger group of schools in the U.S. against a much smaller sample of international schools.

Unlike other rankings, which take into account the quality of the incoming students, the prestige of the faculty, the satisfaction of graduates with the MBA experience as well as the networking power of alumni, and the more immediate employment and salary outcomes for graduates, Forbes zeroes in on one simple measure: ROI.


To compile that metric, the magazine comparies the earnings for the MBA Class of 2012 in their first five years out of business school to their opportunity cost (two years of forgone compensation, tuition and required fees). It includes total compensation, including salary, bonuses and exercised stock options. Forbes also adjusts the actual salary data for cost-of-living and assumes that compensation would have risen half as fast as their post-MBA salary increases had these alumni not attended business school. Schools are solely ranked on the five-year MBA gain, the net cumulative amount a graduate would have earned after five years. Forbes converts pre-MBA and 2016 salaries using three-year average exchange rats, while applying a five-year average to its estimates of five-year MBA gains.

In the one-year MBA category, IE Business School in Madrid moved up two spots to rank third behind IMD and INSEAD. That rank is based on a gain of $145,400. Rounding out the top five one-year MBA programs is Britain’s Judge Business School at University of Cambridge ($140,000) and Italy’s SDA Bocconi School of Management ($138,100).

Among the two-year international MBA programs, IESE captured the No. 2 spot again, also for the fifth year in a row, with a five-year gain of $97,100, up 15.5% compared to 2015. CEIBS in Shanghai ranked third on the list with a five-year gain $95,000, an increase of 32% versus 2015. HEC Paris was fourth, with a five-year gain of $85,300, while ESADE in Barcelona, Spain, had the biggest improvement of any two-year program overseas, gaining five spots to place fifth, with a $58,700 gain.


Forbes placed numerical ranks on nine two-year interational programs and 17 one-year options, the predominant format of the MBA in Europe. Given the larger sample of one-year programs, there was much more movement in those rankings. For one thing, a have dozen new schools made it onto the ranking: Hult International, Imperial College London, City University Cass, Rotterdam, the University of Hong Kong, and Mannheim in Germany.

SP Jain and HEC Montreal both fell six places this year to ranks of 16th and 17th, respectively. Warwick Business School dropped five positions to rank 14th after placing eighth two years ago in the biennial survey. Cranfield Business School also sank four spots to finish 10th.

(See following page for rankings tables with comparison data)