If you are among the lucky applicants who got word last week that you’d been accepted to the MBA program at Stanford Graduate School of Business (GSB), a hearty congratulations! Surely you know that you’ve just gotten into THE most selective business school in the world. We hope you took a little time to bask in that. Even so, if you’re like most admitted MBA students, your thoughts have probably now turned to how you’re going to pay for it.
We’ve devoted this week here on Clear Admit to financial aid—both in publishing our four-part Financing Your MBA Guide—but also in looking more closely at financial aid at a few top schools. Stanford GSB is one.
Wasn’t There Some Issue a Few Months Back?
In case you weren’t paying close attention, the Palo Alto school found itself embroiled in controversy a few months back following a data breach in which a student learned he could access private information about certain students and many employees.
The data—which was made accessible to unintended audiences due to misconfigured permissions on file-sharing platforms—revealed that the school was sometimes distributing financial aid in a manner that seemed in conflict with its stated practice of awarding scholarships based only on need. Data analysis revealed that the school had been awarding scholarships disproportionately based on other criteria including gender, immigration status, and work experience. Stanford officials have stated publicly that there was no evidence of personally identifiable information being compromised, but what the data revealed about the distribution of financial aid became a topic of much discussion.
In the immediate aftermath of the breach, Dean Jonathan Levin turned to an outside data analysis firm to examine the leak and ensure that its reach did not extend beyond what had been reported. Levin also pledged a commitment to more open lines of communication regarding just how financial aid is distributed at the GSB going forward.
An excerpt from Levin’s letter helps shed more light on exactly how aid had been awarded:
“Stanford GSB admits students on a need-blind basis, and admitted students may apply for financial aid. For each applicant, Stanford GSB Financial Aid office calculates a predicted cost of attendance and an expected student contribution. The gap between these amounts is covered by a combination of fellowships and loans. Over the last decade, Stanford GSB has used different formulas to calculate a base level split between fellowship and loans. In addition, the school has offered additional fellowship awards to candidates whose biographies make them particularly compelling and competitive in trying to attract a diverse class.
Stanford GSB’s communications over the years have explained the base level award process, but have not discussed the incremental fellowship awards. I believe that a preferable approach, going forward, is to be significantly more transparent about the principles and objectives being applied in making financial aid awards, and about how different awards are made. We are committed to working on this for the current admissions cycle.”
He added that Kirsten Moss, director of admissions and financial aid, would lead the process of coordinating and executing forthcoming changes to financial aid protocol.
Moss Is Heading Changes to Financial Aid Protocol
Moss stepped in immediately to begin a comprehensive review of the school’s current policies and procedures regarding financial aid. In a letter to the Stanford community, she announced a series of planned first steps to improve the school’s financial aid protocol.
“For students matriculating in the fall of 2018, we are awarding fellowships solely on the basis of financial need, and all of our financial aid materials reflect this policy,” Moss wrote.
According to the Stanford GSB website, “approximately half of Stanford MBA students receive fellowship funds, and half borrow through loans, to finance their degree.” The fellowships, which are gifts from the GSB community, do not have to be repaid. “The average GSB fellowship is approximately $35,000 per year or $70,000 in total awards.”
Moss continued in her February letter to lay out a three-phased initiative to improve the financial aid process for future classes: (Bullets below are republished exactly as they appeared in Moss’s letter.)
Discovery: Collaborate and gather input from students, alumni, faculty, staff, and third-party experts in higher education and financial aid to fully understand the opportunities for improvement, as well as review the MBA financial aid landscape.
Design: Develop a clear statement of goals and objectives for allocating financial aid, as well as justification for the process. This process will align financial aid with the values of our institution, needs of our students, and realities of the marketplace.
Implementation: Communicate our new process to the community, and build the necessary systems to support it.
Moss noted that the first phase is already well underway, with her team working in partnership with the Student Association to determine how best to collect student feedback and suggestions. A faculty and alumni advisory group will also contribute as part of the discover and design phases, and a new full-time role is being created to work directly with Moss to lead implementation and communication for the new process. Lastly, beginning back in February, Moss established weekly office hours for students seeking to discuss their experiences or perspectives as related to financial aid.
“As Dean Levin has mentioned, it is vital that Stanford GSB fellowship awards are underpinned by a transparent and well-understood process that treats students fairly,” Moss continued. “I recognize that we have failed to do this and am fully committed to leading this initiative to ensure we meet this goal moving forward.”
There are currently four additional fellowships provided by Stanford GSB that are targeted to students with specific backgrounds who demonstrate financial need:
- Stanford Africa MBA Fellowship, for citizens of African nations with financial need who agree to return to Africa to work for at least two years after graduation;
- Charles P. Bonini Partnership for Diversity Fellowship, for U.S. citizens and permanent residents who bring diverse perspectives and agree to complete a 9- to 12-month corporate internship prior to enrolling at Stanford;
- Stanford Reliance Dhirubhai Fellowship, for Indian nationals living in India who need financial assistance and commit to return to India to work for at least two years, and
- Stanford USA MBA Fellowship, for U.S. citizens and permanent residents with financial need who have strong ties to the Midwest and commit to returning to and working in the Midwest for at least two years after graduating from Stanford.
All of the above fellowship programs require an additional application that had to be submitted before or as part of the regular Round 1 and Round 2 MBA applications.
For complete details on current financial aid protocol at Stanford GSB, click here.
We will follow this space and keep the Clear Admit audience informed regarding any future changes Stanford GSB implements with regard to MBA financial aid protocol.