Microsoft does not pay Natasha Müller’s €72,700 executive MBA tuition fees, but it does give her time off from her marketing and communications management job at the technology company’s Munich office to study at IESE Business School’s campus in the Bavarian capital. “While they have not given me any money, they help me in other ways,” says the 36-year-old Briton, who enrolled this September.
Employer funding for EMBAs used to be plentiful, as companies used the courses to groom executives for boardroom appointments, says David White, founding partner of admissions consulting agency Menlo Coaching. But corporate sponsorship has shrunk since the 2008 financial crisis, he says.
Most students now fund their studies from a mix of sources, including corporate sponsorship, scholarships, savings, loans, grants and family support, says Stefan Michel, EMBA dean at IMD business school in Switzerland. But it is tough: fees are high and it can be hard to work out what support is available, particularly when studying internationally.
Just 15 per cent of students this year have had all their tuition fees reimbursed by employers, according to a survey of 161 business schools conducted by the Executive MBA Council (Embac), an academic association. This was down from 23 per cent in 2015 and 34 per cent in 2007. The proportion of students who were partially reimbursed also fell, from 36 per cent in 2015 to 32 per cent this year.
This is partly because companies fear they will not receive a return on their investment. “Few people stay at an employer for 30 years any more,” says Michael Desiderio, executive director of Embac. As a consequence, company sponsorship usually requires graduates to stay at the employer for a fixed period, or repay the employer the fees. Some students turn down this offer, though, says Desiderio, as they want to be flexible.
Many EMBA students, then, face a battle to afford their course: tuition fees alone at top schools can be in six figures. The Kellogg-Hong Kong University of Science and Technology EMBA, for example, costs $183,500. On many courses, living and travel expenses add substantially to the bill.
Many schools have also raised tuition fees to reflect higher operating costs, says Patty Keegan, an associate dean at the University of Chicago Booth School of Business. The school’s EMBA fees have risen by between 3 and 4 per cent each year for the past 10 years, she says. To offset this, business schools in general have increased scholarships, Keegan adds. Indeed, 61 per cent of EMBA programmes surveyed by Embac provided scholarships to students this year, up from 53 per cent in 2015.
Many financial programmes tend to focus on supporting diversity. For instance, IESE offers scholarships covering up to 15 per cent of tuition fees. Those eligible come from under-represented groups such as women; those who have high scores on entrance tests; demonstrate leadership; have an impact in society; or a financial need. Müller, for example, received a €7,000 women-only scholarship. “When you are self-funding [with savings], every euro counts,” she says.
Meanwhile, Keegan reports anecdotal evidence of an uptick in EMBA students securing bank loans. Sums of up to €60,000 are available to masters students through Spain’s Santander, for example, with an interest rate starting at 5.14 per cent.
Citizens of the US are also eligible for federal loans. Direct Plus loans, for example, cover the full cost of attendance (determined by schools), with an interest rate fixed at 7.08 per cent. Stafford loans, another federal loan for education that offers up to $20,500 per year, are available at a fixed rate of 6.08 per cent. Both these options are available to US citizens studying at home or overseas at schools that participate in the loan programmes (a list is available online).
Many overseas students at US schools, however, are ineligible for federal support. And without a local credit history, international students usually need a creditworthy US citizen or a permanent resident to co-sign a loan with a bank, to guarantee its repayment.
In response, some schools have struck loan agreements with banks so that overseas students can access credit without a co-signer.
Tips to secure sponsorship from employers
Maria Ong, a commercial excellence leader at GE Healthcare, received $20,000 from her employer to do the National University of Singapore EMBA between 2018 and 2019. She shares her insights into securing corporate support:
Be prepared. “Know what the training budget is and how much employees have been given previously.”
Then request a similar amount from a direct manager, who is aware of your performance and contribution to the company. Explain how the EMBA will add value to the business in the long term. “Companies see this support as a way to retain employees,” says Ong.
Pitch in person or by phone. This is more personal, though Ong advises sticking with your organisation’s preferred communication style.
Make the request early. “If you pitch when they are still planning next year’s training budget, they may be in a better position to allocate money,” says Ong.
Ask for more money the following year. GE Healthcare said Ong could renegotiate the funding, though she was satisfied with the original award. “Don’t force it too much,” she says. After all, sponsorship is scarce.
At the University of Virginia Darden School of Business, EMBA students can borrow up to $98,000 per year from Discover, a bank holding company, without the need for a US co-signer.
Peer-to-peer lending is another route to financing study around the world. Prodigy Finance offers loans of up to $220,000, at interest rates of up to 7.49 per cent, to students from 150 countries enrolled on more than 25 EMBA programmes. The funds are raised from a community of business school alumni, and institutional and private investors. A co-signer is not required and Prodigy focuses on students’ earnings potential in its risk assessments.
Elsewhere, government schemes support students. Employers in England with an annual salary bill of more than £3m pay an apprenticeship levy, for example. Some companies use these funds to support employees through EMBA programmes at schools approved by the Education and Skills Funding Agency (a list is available online).
“The levy is a win-win for learners and employers,” says Elena Beleska-Spasova, head of post-experience postgraduate courses at Henley Business School in southern England, whose flexible EMBA course can be funded through the levy.
For students, the return on investment is clear, even though EMBAs are expensive. Three years after graduation, the average salary for alumni of schools in the FT’s 2018 EMBA ranking was $220,000, up 59 per cent on the average pre-programme salary. Nicole Tee, director of graduate studies at NUS Business School in Singapore, says: “Many of them continue to reap the benefits of the EMBA throughout their lives, whether it is through increased confidence, career opportunities or connections they make during the programme.”