In early June, as a firestorm of racial discontent swept the United States in the wake of the killing of George Floyd by a Minneapolis police officer, business schools reassessed their efforts to achieve more diversity in their student and faculty ranks. Among them was the Ross School of Business at the University of Michigan, where Dean Scott DeRue issued a lengthy and detailed “commitment to action” that included the creation of a Dean’s Council for Diversity, Equity, and Inclusion composed of students, faculty, staff, and alumni, and a DEI Curriculum Taskforce charged with “looking at DEI broadly, and race specifically, in Ross School courses and co-curricular activities.” The dean promised the work of the task force would lead to new courses focused on DEI.
Two months later, another piece of the puzzle has emerged at the Ross School. A pair of prominent alumni — Stephen Ross, the school’s namesake, and Jeff Blau, CEO of Ross’s flagship real estate corporation — have given $6 million to help the B-school further its commitment to diversity, equity, and inclusion in real estate business and investing, where the school has long been a leader and where it increased its investment in February of this year with the launch of a new center. The new gift, announced Thursday (August 6), will support “a spectrum of initiatives” that are designed to recruit and support more under-represented populations into the fold with innovative learning and work experiences.
“We want to work with either high school students or prospective MBAs to get them interested in business and investing, and really with a focus on students from backgrounds that are underrepresented in business leadership positions,” Dean DeRue tells Poets&Quants. “So even if they don’t ultimately go into real estate, getting more diversity into business schools and thus into business is one element of this.”
ANOTHER LAYER OF REAL ESTATE EDUCATION AT MICHIGAN ROSS
The Blau Initiative for Diversity in Real Estate and Infrastructure will have four components targeted at students from underrepresented backgrounds: sparking undergraduate and graduate student interest in business and investing prior to attending the University of Michigan; attracting and recruiting talented students to Michigan Ross by making it more affordable; creating unique transformational learning experiences, both inside and outside the classroom, with a focus on action-based learning; and creating opportunities for students to have work and internship experiences that they might not otherwise have. The Related Scholars Fund, named for Related Companies, Stephen Ross’s multinational company, will “provide scholarships to attract and support students from diverse environments who are underrepresented in business leadership, including students from low-income backgrounds, who are interested in pursuing careers in investing and/or real estate through Michigan Ross,” the school says in a news release.
The Ross School has positioned itself to make waves in real estate DEI: According to its most recent MBA employment report, 4.1% of 2019 graduates worked in real estate by function (earning a base median salary of $112,504), a high number relative to Michigan’s peer schools. In fact, only one school with a major real estate pathway in its MBA beats Ross: UNC’s Kenan-Flagler-Flagler Business School sent 10% into real estate by function in 2019. Everyone else of note — including UCLA Anderson, Wharton, Columbia, and Northwestern Kellogg — had a smaller percentage go into real estate last year. Even before its announcement of the new Weiser Center in February, the Ross School offered a real estate certificate for graduate students that is a joint partnership with the Taubman College of Architecture and Urban Planning, allowing students to complement their MBA with a certificate in real estate.
“With the creation of the Weiser Center and now this new initiative and Related Scholars program, I think the collection of these resources for students who are interested in investing and interested in real estate as an asset class will really strengthen the Ross School’s positioning in terms of the business of real estate — and give students who are interested in investing and real estate a world of opportunity and experiences that are really world-class,” DeRue says. “It will really put the Ross School in a leadership position with regards to this space. And when you put all of the pieces together, in terms of building the pipeline of diverse talent into business schools, making education more affordable, giving them transformational experiences, and creating connections to the world-class companies in real estate and infrastructure and investing — that whole package is going to be really special for our students.”
Asked whether the Ross School’s investments in real estate education in 2020 signal an effort to become the top real estate B-school in the U.S., DeRue answers: “I might argue we are already there.”
DONORS BOAST MORE THAN 8 DECADES’ EXPERIENCE IN REAL ESTATE
Stephen Ross formed Related Companies in 1972 and remains its chairman. The company today — one of the world’s largest owners of affordable housing — has over $60 billion in real estate assets owned or under development, including mixed-use, residential, retail, and office properties in premier high-barrier-to-entry markets. The company employs approximately 4,000 professionals. Blau, as CEO and a general partner as well as a 1990 graduate of the University of Michigan, has spent 30 years with Related Companies, directing and overseeing new developments in virtually every sector of the real estate industry and overseeing Related’s strategic direction and overall management.
The Blau Initiative for Diversity and the Related Scholars Fund will integrate with existing University of Michigan and Ross outreach and access success programs, such as MREACH, Summer Business Academy, the Preparation Initiative, and the business school’s Consortium membership. The Blau Initiative will support the Related Scholars Fund and other programs such as a new Michigan Ross Investing Academy; the Blau Career Development Series, which will include activities such as company visits and career mentorship opportunities and professional development workshops; and the Blau Internship Program, which will support internships at Related Companies.
“I am honored to make this commitment to Michigan Ross, and I hope it proves useful in getting more students from diverse backgrounds interested and involved in the fields of real estate and infrastructure investing,” Blau says.
Adds Stephen Ross: “I’ve been in real estate for more than 50 years and have a unique opportunity and obligation to foster more diversity in our industry. The Ross School is an ideal partner in this work.”
‘SEEING AN INCREASE IN DIVERSITY IN OUR CLASS’
In a major report in April, the Graduate Management Admission Council described an improving landscape for graduate business prospects of Hispanic descent, but a stagnating one for Black candidates. GMAC, which administers the Graduate Management Admission Test, found a rising number of test takers of Hispanic descent, but a flattening — and even shrinking — proportion of Black examinees, with most of the latter group hailing from New York, Texas, and Georgia. In the top 25 U.S. B-schools, Michigan Ross is in the bottom quarter for MBA minority representation, with 23.2% in the Class of 2019, down slightly from the previous two years.
Dean DeRue’s Council for Diversity, Equity, and Inclusion — designated in his June commitment statement as the “primary advisory group for DEI-related initiatives and priorities, establishing goals and tracking progress with visible metrics and reporting, and mobilizing people and resources to ensure we achieve our shared goals,” — was launched to help change that. The $6 million investment from Stephen Ross and Jeff Blau represents another step toward that goal, and one that already is paying off. DeRue says a day after the school announced the donation it has found its first student scholar to be part of the new program.
“We already have our first student coming in from Texas — our first Related scholar,” he says. “So she’s a pioneer. And so this year, both for our MBAs as well as our undergraduates, we’re seeing an increase in diversity in our class, and we’re really proud of that. But we also recognize that we have more work to do.”