Business Education in Law School

January 18th, 2013 / By Deborah J. Merritt

Robert Rhee, the Marbury Research Professor of Law at the University of Maryland’s law school, is well qualified to write about the relationship of legal and business education. Rhee holds both a JD and an MBA; he has worked as a government lawyer, a law firm partner, and an investment banker; he co-directs Maryland’s Business Law Program; and he authored a book (Essential Concepts of Business for Lawyers) that introduces law students to key business principles.

Rhee’s most recent paper on legal education proposes creation of a “JD/MBL” curriculum. The “MBL” stands for “Masters of Business Law” but, as Rhee quickly explains, this is simply an “idea tag.” The name reflects a focused, interdisciplinary group of business courses pursued as part of the JD program. Candidates completing this work might receive a certificate, but they would not necessarily qualify for a separate master’s degree. Rhee uses the “MBL” name as a handy reference for the program he proposes.

The Program

Rhee’s proposed “MBL” includes (1) most of the traditional first-year courses; (2) Administrative Law, Evidence, and Professional Responsibility; (3) a full range of business-related law courses (Corporations; Partnerships; Income Tax; Securities Regulation; Corporate Finance Law; Partnership or Corporate Tax; Intellectual Property); (4) a set of business courses taught either at the business school or law school (Math & Excel Camp; Management; Financial Accounting; Corporate Finance; Business Communication; Litigation & Management; Managerial Economics; Early Stage Business Advising: Mature Stage Business Advising; Entrepreneurship; Leadership & Teamwork; Strategy); and (5) a few electives.

The curriculum is intense. In fact, my first response was “wow, no wonder business people are disappointed with their lawyers. There’s a lot we don’t know.” I still don’t know enough about practicing or teaching business law to comment on the specifics of Rhee’s proposed curriculum. But as Rhee explores his proposal, he offers a number of other insights that legal educators may find interesting. I summarize those, as well as some of my own reactions, below. Law schools considering the integration of law and business perspectives may find Rhee’s insights useful even if his specific proposal fails to serve their needs.

Integrating Business and Law: Insights

1. Rhee harpoons the notion that a standard JD prepares graduates for careers as corporate executives, investment bankers, management consultants, entrepreneurs, or other “business” people. Some JDs transition into those positions, Rhee acknowledges, but those outcomes stem from very adaptive lawyers who capitalize on unusual circumstances. If law school really prepared students for careers in business, why wouldn’t corporations, investment banks, and management consulting firms regularly recruit at law schools for their business positions? And why wouldn’t more BigLaw associates move into business (rather than in-house legal) positions when winnowed from their firms?

These points sound persuasive to me. A standard law degree might be useful for a student who planned to return to his family business–although, even there, it seems to provide more law and less business training than optimal. But why would a generalist law degree prepare students particularly to work in corporate management or investment banking positions? Those professionals make complex decisions based on bodies of knowledge as specialized as (but different from) the material we teach in law school.

If you have any doubts about Rhee’s argument on this score, take a look at his business-proficiency quiz on pp. 11-12. Answering these questions correctly wouldn’t qualify a student to work as an investment banker or management consultant; a good score would merely make a new lawyer conversant with business terms. Yet a large proportion of law graduates, I suspect, would fail even this basic quiz. Rhee’s rejection of law as a general-purpose degree that prepares graduates for today’s business world is an informed, and useful, counterpoint to generous claims about the versatility of the JD.

2. Rhee, notably, also rejects the utility of a joint JD/MBA for most graduates. The joint degree, he argues, offers too much business for a student who will practice law and too much law for one who will pursue business. A joint degree program can preserve options for a student who isn’t sure which path she will pursue, but it is an expensive option-saver. It is more efficient to develop programs that deliver useful business concepts to future business lawyers, without requiring those students to obtain a full MBA.

Rhee, by the way, notes that he did not obtain his two degrees in a joint program. He first earned his JD, clerked for a federal appellate judge, and worked in the Justice Department Honors Program. He left government for an MBA program precisely because he could not transition into business with a JD alone. Having changed his career goals, he needed a different degree.

3. The most effective way to train business lawyers, Rhee suggests, is through a three-year JD program that includes a heavy dose of business courses. That is his “MBL” model outlined above. This “Goldilocks” model aims to give business lawyers just the amount of business education that they need to gain an advantage in the workplace.

4. Rhee’s article is refreshingly candid in acknowledging that a specialized business program–no matter how artfully designed–cannot trump all other hiring considerations. He acknowledges that his proposal is not the silver bullet that will guarantee business law employment for all graduates. A BigLaw firm’s corporate department probably will hire a Harvard Law graduate over a Maryland one, even if the latter student has more focused business coursework. The proposal, Rhee suggests, will improve education, and may improve initial job placement at the margins. The student who completes an MBL-like program may win an entry-level job away from a peer at a similarly ranked school without such a program; an MBL school should not expect (or promise) more.

5. Rhee notes, however, that MBL courses may prepare a student to outperform peers after securing that first job. A JD with focused business preparation may impress clients and bosses, and may find a more secure workplace niche. This advantage could be useful in today’s workplace, where employers more frequently use apprentices, interns, and fellows; the MBL graduate may stand out in that type of position–as well as in more traditional associate jobs that rely upon the survival of the fittest.

Equally important, the MBL will give the graduate more ability to jump to business positions. The standard JD, in Rhee’s opinion, does not confer the type of business versatility that law schools claim. But a JD that incorporates a significant portion of the MBA curriculum may serve that purpose.

These points strike me as important in evaluating curricular changes at law schools. The job market will be volatile for the foreseeable future; volatility may be a constant for our future graduates. Rather than claim that the conventional JD is versatile, schools could explore how they can make their degree more versatile. No degree can be all things to all people in today’s world. But a JD with a business focus might give graduates options that neither the JD nor MBA alone can deliver.

6. Even for schools with no interest in developing an MBL-like program, Rhee’s review of the potential courses in that program is quite informative. As Rhee points out, most law students have little business, management, or financial competence. Those skills apply to many areas of law practice, not just to serving corporate clients. Almost any lawyer today, furthermore, will benefit from basic competence in these areas just to manage her own practice–or to understand how her organization is managed. Educational reformers of all types may find some of Rhee’s proposed courses useful.

Final Thoughts

There is more in Rhee’s article than the points I’ve outlined here. He discusses, for example, different ways of financing MBL courses, as well as some of the “sacred JD cows” that might have to be sacrificed for students taking part in his program. On the sacred cow side, I’ll note that although I currently teach Evidence (which Rhee would keep for his MBL students) rather than Constitutional Law (which he jettisons), I’m troubled by the idea of students earning a law degree with no knowledge of Constitutional Law. I understand that some schools overdo the Marbury stuff for future business lawyers, but surely we could find 2 credits for some basic constitutional principles?

On the grander scale, Rhee’s paper is useful for law school innovators because of the approach it adopts. Rhee takes a hard look at what the current JD curriculum delivers and what it doesn’t offer. He draws upon his experiences in law practice and business to formulate a specific proposal about how schools might educate students more effectively for careers that span business and law. He’s not afraid to get concrete, even about the elimination of Constitutional Law. And he doesn’t over promise what an MBL track could achieve.

I’d like to see similar proposals for other areas of law practice. What would a JD with a labor/employment, intellectual property, or other focus look like?