IMD Repeats As Winner In Forbes’ 2019 International MBA Ranking

IMD graduates

For the second consecutive time, one of the smallest MBA programs in Europe bested every other school in the world for having the best five-year gain in pay. The MBA graduates of IMD in Lausanne, Switzerland, with an annual intake of just 90 students, recorded the best return on investment of any MBA in the world with five-year gains in pay that totaled $168,900.

The actual increase in compensation attributable to the MBA beat every U.S. business school. In fact, six international one-year programs topped Chicago Booth, the No. 1 U.S. MBA program, according to the 2019 Forbes MBA ranking published today (Sept. 18). Booth earned first among the U.S. schools with a five-year gain of $94,400–a difference of $74,500 from the gain recorded by IMD graduates. IMD’s secret? A one-year, rather than a two-year MBA, with lower opportunity costs and tuition.

Forbes, which also publishes a separate list of two-year programs outside the U.S., put London Business School on top for the sixth time in a row. Among the two-year programs on the list, HEC Paris came in second, IESE Business School in Spain was third, with Ceibs in Shanghai, China, fourth, and ESADE in Spain fifth.


The escalating cost of the MBA in the U.S., in fact, has driven away applicants and students. International MBA programs saw an average 5% increase in applicants and an average 16% increase in enrollment over the last ten years, according to Forbes. Full-time MBA programs in the U.S., meantime, saw a 16% decrease in applicants and an 11% drop in enrollment over that same period. The upshot: Graduates from the best one-year international programs produced an average five-year MBA gain of $91,300, while MBAs alumni from international two-year business schools had an average five-year gain of $62,300. In contrast, MBA graduates of U.S. programs had a five-year gain of $54,500.

When Forbes last crunched its ROI data, IMD had beaten INSEAD in the one-year international category by a significant margin, with five-year gains of $194,700, $44,300 more than INSEAD’s $150,400. This time around, No. 2 INSEAD narrowed the gap, with IMD’s five-year gain falling to $168,900 versus INSEAD’s $154,700, a difference of just $14,200. Even so, Cambridge Judge Business School is right on INSEAD’s heels, with a gain over the same timeframe of $153,000, a mere $1,700 under INSEAD.

Forbes‘ surveys found that IMD students came to the school with pre-MBA salaries of $82,000 and earned annual median salaries of $200,000 five years after graduation. At INSEAD, pre-MBA salaries were slightly lower, $79,000, and so were median salaries five years later at $195,000.


IMD Dean Sean Meehan

Rounding out the top five on the one-year list were No. 3 Cambridge, No. 4 SDA Bocconi in Italy, and No. 5 Oxford Said. IE Business School in Spain fell just outside the Top Five among one-year programs to finish sixth this year, from its third-place ranking two years ago. Warwick Business School in Britain showed the biggest improvement on this ranking, rising by six places to finish eighth, compared to its 14th place showing two years ago in the biennial ranking. The University of Hong Kong lost six spots to rank 13th from seventh in 2017.

On the two-year international list, HEC Paris moved up two places–the best improvement of any school on the ranking–to rise into second place from fourth two years ago. Otherwise, the schools with two-year MBA programs moved just slightly or not at all. One exception was the sole newcomer on the list: The Australian Graduate School of Management which entered the ranking in eighth place.

A day after the rankings went public, IMD alumni had gathered on the campus for an event and were buzzing about their repeat win. Sean Meehan, dean of IMD’s MBA program, is taking the good news in stride, welcoming the new ranking but not overly excited about it. “I think the rankings serve an important role for students,” says Meehan. “It makes the schools more transparent and it holds us accountable. Whether you’re one or two or 22 is less important. I want students to figure out what parts of a ranking are important to them.”


Unlike other rankings that take into account the quality of incoming students, their satisfaction with the MBA program and their immediate employment and salary, the Forbes list is based on the median return on investment achieved by an MBA class that graduated five years ago. The dollars-and-cents calculations, measuring salary, bonuses and exercised stock options, place no value on the education, the faculty, the alumni networks, or any other factor that would generally measure the quality of an MBA program. In its novel approach, Forbes also assumes that compensation would have risen half as fast as students’ post-MBA salary increases if the graduates had not attended business school.

The numbers reported by Forbes are also adjusted to take into account cost-of-living expenses, and the earnings gains are discounted using a rate of 4.1% which is the discount rate most recently used by large companies in their pension funds. The magazine also discounts tuition to account for students who pay in-state rates and for scholarships and the non-repayable financial aid that schools dole out. Forbes does not deduct taxes from the earnings gains or account for the debt repayments from student loans

The methodology is largely based on self-reported data from MBA alumni who could inflate their compensation to help their schools score better on the list. Schools that place more students into high-paying finance jobs are also likely to do much better than schools where a higher percentage of students accept jobs in lower-paying sectors, including non-profits, the government, or education. The ROI calculation, moreover, is also subject to error based on the percentage of alums who complete and return the surveys to Forbes.


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