Business school professors’ picks

Welcome to professors’ picks, offering a weekly curated selection of FT articles by and for business school faculty to connect classrooms to current events and to develop students’ critical thinking.

Read all submissions at www.ft.com/bschoolpicks. Save this link in myFT to receive emails alerting you to each new edition. Search the tags for relevant topics to illustrate teaching points. Encourage students to join the debate in the comments section beneath the article.

Comments or contributions? Get in touch at profpicks@ft.com 

Supply Chain Management

Denmark’s Maersk buys Panama Canal railway

Summary: The Panama Canal Railway serves as a land bridge for shipping traffic between the Pacific Ocean and the Atlantic Ocean. It serves as an alternate route between the two ends of the Panama Canal, which is especially useful during a drought, and cuts the shipping time from three weeks (going around South America) to an average of less than a day. Railway capacity is up to about 10 per cent of that of the Canal, which handles about 5 per cent of global maritime traffic, compared to 15 per cent for the Suez Canal and 30 per cent for the Malacca Straits. 

Maersk is a global leader in integrated logistics and container shipping. It also builds and operates port terminals, runs freight railway lines, manages storage services and provides supply chain services such as contract management. It is the second largest shipping company in the world with a 14 per cent market share, behind the Mediterranean Shipping Company (MSC) with 20 per cent.

Classroom application: The Panama Canal and Railway are complementary. With the containerisation of cargo, which allows for easier intermodal shipping, using these assets together becomes easier. From a supply chain perspective, the acquisition offers advantages and drawbacks which students can explore. They can discuss strategic and competitive perspectives on the acquisition.   

Questions:

• What advantages does the option of using the Panama Canal Railway between Balboa and Colón provide to Maersk?

• What are the limitations and drawbacks of using the Panama Canal Railway?

• Prior to the Maersk purchase, the Panama Canal Railway was owned by US-based Lanco Group and Canadian Pacific Kansas City, which operates across North America. Any shipper could use the Railway. Should Maersk allow others including MSC to continue to use this Railway? 

• Strategically, is Maersk’s acquisition of the Panama Canal Railway justifiable?

Prakash Mirchandani, Professor, Katz Graduate School of Business

Leadership, Sustainability

BP pivots back to oil and gas after ‘misplaced’ faith in green energy

Tags: Responsible Leadership, Sustainability, ESG, EnergyTransition, CorporateStrategy, ParadoxMindset, PolarityThinking 

Summary: BP’s strategic shift raises questions about responsible leadership and the paradox of balancing corporate purpose with sustainability. Increasing oil and gas investments by $10bn while scaling back renewables prioritises short-term financial stability but risks undermining BP’s net zero commitments. It challenges investor confidence, stakeholder trust and BP’s position in a shifting energy market. A paradox mindset and polarity thinking are crucial in recognising that profit and sustainability are interdependent, not opposing forces. Responsible leadership demands a balanced approach, leveraging fossil fuel revenues to drive clean energy innovation. To remain competitive and credible, BP must align profitability with environmental and social responsibility, ensuring resilience in a world transitioning towards sustainability. 

Classroom application: Students can explore how a paradox mindset and polarity thinking help leaders navigate the tension between corporate purpose and sustainability in strategic decision-making. 

Questions: 

• How does BP’s strategy reflect responsible leadership in balancing profit and sustainability? 

• What ethical considerations arise when prioritising short-term financial gains over long-term environmental commitments? 

• How might BP’s leadership apply polarity thinking to balance financial performance with sustainability? 

• What are the risks and benefits of BP adopting a more integrated energy transition strategy? 

• How can corporate leaders develop a paradox mindset to drive both sustainable innovation and profitability? 

Dimitrios Spyridonidis, Associate professor, Warwick Business School

Business

Can international aid survive in a crumbling world order?

Tags: International Aid and Business, Humanitarian, Business and Government

Summary: War, conflict, political tensions and climate change are escalating humanitarian crises to unprecedented levels. Equally concerning is a significant global funding gap to address these crises. This article offers a comprehensive overview of the evolving international aid landscape, highlighting how the US and many other Western governments are drastically reducing aid budgets. Future aid is likely to be increasingly tied to and influenced by geopolitical interests.

The article presents contrasting viewpoints: some experts warn of a bleak future without robust international aid, while others say market-driven mechanisms could eventually replace traditional aid, potentially achieving greater long-term impact.

Business school students often have limited exposure to the structure, scale and effects of foreign aid. While they may encounter some humanitarian case studies, they don’t always grasp how aid can facilitate long-term business entry, success and ecosystem development in regions with dysfunctional markets. This article serves as a foundation for discussing these pathways. It also opens the door to exploring innovative, market-based models that could replace conventional aid approaches, presenting potential opportunities for business and social enterprises.

Questions:

• Should business leaders be concerned about the rapid changes in the size and structure of foreign aid? Why should they care? What are the pathways through which foreign aid affects businesses that do not directly receive aid funding?

• Is the future of aid centred on foreign government-to-recipient government programmes or foreign government-to-NGO programs? Which one is more in touch with the on-the-ground realities of the end beneficiaries? Which achieves scale more rapidly? Which offers greater efficiency, measured by the number of beneficiaries reached per dollar spent?

• Can concessional loans, equity loan guarantees and financial de-risking mechanisms effectively replace aid grants? Or is unrestricted grant capital essential for frontier markets to function, particularly in socially relevant sectors?

Luk Van Wassenhove, Emeritus professor, Insead; and Prashant Yadav, Senior Fellow, Council on Foreign Relations

Finance

Could Manchester United really be worth £7bn?

Tags: Acquisitions, Brand Value, Relative Valuation, Football

Summary: In November 2022, the Glazer family announced they were exploring “strategic alternatives” for Manchester United, including a potential sale. The club’s stock price surged, reflecting investor optimism that new ownership could unlock greater value. The team, which claims the largest fan base in the Premier League, hoped to fetch a valuation close to £7bn.

The sale process ultimately attracted two serious contenders: Sir Jim Ratcliffe, the British billionaire and founder of Ineos, who stressed long-term investment and a commitment to restoring United’s footballing legacy; and Sheikh Jassim bin Hamad Al Thani, representing Qatari interests, who submitted multiple bids to acquire full control of the club.

What followed was a drawn-out bidding process marked by uncertainty over whether the Glazers would pursue a full or partial sale. On 15 October 2023, Sheikh Jassim withdrew his offer, triggering a sharp fall in United’s share price. Two months later, Ineos finalised a deal to acquire a 25 per cent stake in the club, at a valuation of approximately £6bn.

Classroom applications: This case offers rich ground for discussing M&A transactions, particularly in the sports industry. It prompts discussion around the growing involvement of private equity and sovereign wealth funds in football club ownership, and team sports more generally. Manchester United’s contested sale offers an opportunity to explore the challenges of valuing iconic sports brands, especially when financial performance does not fully reflect brand potential. It also allows students to analyse bidding strategies, deal structures and market reactions throughout the transaction process. Finally, students can use relative valuation techniques to attempt a valuation of the target and critically assess whether the Glazers’ £7bn price tag was grounded in financial reality.

Questions:

• Market reaction: How do you interpret the initial stock price surge and subsequent drop following Sheikh Jassim’s exit? What role do risk arbitrageurs play in M&A situations like this?

• Valuation vs fundamentals: Does Manchester United’s brand value and financial performance support the £7bn valuation the Glazers were seeking? Is the club undervalued relative to its peers?

• Valuation methods: estimate a valuation for Manchester United using precedent transactions (Chelsea, Newcastle and PSG: Qatari owners of Paris Saint-Germain target valuation of over €4bn) as well as comparable teams (data available from the Swiss Ramble and Forbes)

• Acquisition premium: If the Glazers had sold at £7bn, what would the implied acquisition premium have been? How does this compare to the empirical evidence on premiums in M&A transactions in the sports industry and more broadly?

Sonia Falconieri, Professor, Bayes Business School

International business

TSMC profits jump 54% on back of AI chip boom

Disciplines: Global Commerce, Finance, International Strategy, AI

Tags: TSMC, ASML, Amazon, Microsoft, Nvidia, Apple. AI, capital investment, chip competition.

Summary: Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest chipmaker, expects a nearly 30 per cent revenue gain in 2025 due to rising AI demand and a rebound in smartphones, industrials and cars. It reported a 54 per cent year-over-year net profit increase to NT$325.3bn for Q3, above forecasts. Suppliers to Amazon, Microsoft, Nvidia, and Apple, the business expects AI chip sales to triple this year, accounting for 15 per cent of revenue.

Despite recent concerns about the semiconductor sector, mainly after ASML reported disappointing orders, TSMC remains resilient because of its deep client base and scale advantages. While it anticipates spending just over $30bn in 2025 on capital expenditures, it has only spent $18.5bn by September 2024. Analysts believe TSMC’s strength will stabilise the market, especially compared to Intel and Samsung, which are struggling with sophisticated chip manufacturing.

Classroom application: This article provides an opportunity for faculty to discuss current events in the classroom through a business lens and the true definition of competitive advantage. For example, over the past year, and as direct competitors, TSMC’s stock has been up nearly 17 per cent, with Nvidia posting a 21 per cent increase over the same period. By contrast, Intel is down 48 per cent and competitor AMD is down nearly 43 per cent.

Questions:

• What strategic advantages enable TSMC to outperform competitors like Samsung and Intel in semiconductor manufacturing?

• How does TSMC function as a “foundry” for more than 500 businesses, and how does it support its scalability and resilience?

• What provides TSMC with its sustained competitive edge from its position in the AI value chain?

• How does TSMC’s brand and market dominance change due to its service to tech behemoths like Nvidia, Apple, Amazon, and Microsoft?

• What conclusions can we draw from TSMC’s higher capital expenditure plan, and what potential long-term effects can it have on its financial performance?

• How does the market respond when bullish projections (like TSMC’s) conflict with financial results (like ASML’s lacklustre orders)?

Case discussion positioning: The Lex column argued that TSMC can successfully weather geopolitical tensions, while another article suggested Taiwan can take comfort in the strategic importance of its Silicon Shield — the second largest semiconductor industry worldwide — to protect it from a Chinese invasion. But while TSMC’s pledge to spend $100bn in the US is a good step, the former Intel CEO doesn’t believe it will advance the US’s position unless next-generation transistor technology is designed domestically. As the academic Chris Miller argued: “This investment cements America’s position as a significant player in advanced chipmaking, behind only Taiwan and South Korea. TSMC’s customers — mostly big US chip designers like Nvidia, Apple, and AMD — will welcome the further geographic diversification of its manufacturing operations.”

In the background is President Trump’s call to eliminate the $52bn Chip Act, which will reduce subsidies for companies like TSMC. CEO CC Wei said he was not afraid while Taiwan’s president Lai Ching-te said he was “only demanding fairness” vis-à-vis any political decisions or their fallout.

Gregory Stoller, Master Lecturer, Boston University Questrom School of Business

Global Commerce, Finance, International Strategy, AI

Ethereum faces ‘midlife crisis’ as rivals play catch-up

Tags: Ethereum, Ether, Stablecoin, Memecoin, Cardano, Solana, Bitcoin

Summary: The Ethereum blockchain’s underlying cryptocurrency Ether has lost 40 per cent of its value in the last three months, underperforming other well-known tokens like Cardano, Solana and Bitcoin. The market’s disappointment with Ethereum’s “decentralised finance” (DeFi) promise, growing competition from quicker and less expensive alternatives like Solana and waning investor enthusiasm all contribute to this decline.

Ethereum was formerly thought to provide the foundation for popular financial blockchain initiatives, but it is currently faced with dwindling user activity, internal leadership conflicts and an identity crisis. Because layer 2 networks siphon off transaction fees, developers find it difficult to perform technical updates without jeopardising the platform’s profitability.

Ethereum has been overshadowed by speculative trading in memecoins, which are primarily housed on Solana. Although still strong, Ethereum’s community is struggling with internal conflicts and a decline in momentum among institutional and crypto-native investors. According to critics, it is now “just one of many speculative crypto projects,” and its future in the struggle for supremacy is unknown.

Classroom application: This article provides an opportunity for faculty to discuss current events in the classroom through a business lens and how Ethereum can be repositioned. There are also ethical considerations with a societal impact related to whether meme-driven tokens dominate blockchain activity and what this might mean for the original mission of decentralisation and financial inclusion.

Questions:

• In the past, Ethereum dominated the blockchain and smart contract market. What strategic errors might have led to its present problems?

• According to the article, Ethereum is going through a “midlife crisis.” What does this mean in the framework of the innovation lifecycle?

• The Ethereum Foundation is divided, with developers arguing about the platform’s course. What obstacles must decentralised groups overcome to preserve cohesion and vision?

• The focus of investors has switched to “attention economy” tokens and memecoins. What does this indicate about financial market speculation?

• Ethereum was designed to accommodate further uses, such as tokenised assets and stablecoins. Is the platform advantage being lost?

Case discussion positioning: Kelly Hampaul, founder of Everett Capital Advisors, argues “even optimistic advocates must acknowledge that digital asset markets currently fall short in how counterparty risk is assessed.” The FT said (Quantum Blockchain mines Bitcoin with AI, and we have more questions): “Bitcoin uses a calculation lottery to determine which miner creates the next block for the blockchain and takes the reward,” with companies like Quantum Blockchain Technologies promising faster results using AI. Crypto celebrated Trump’s victory as a kindred spirit in November according to Cornell professor Eswar Prasad, with an even stronger shot-in-the-arm coming from President Trump naming tokens included in the strategic reserve.

Gregory Stoller, Master Lecturer, Boston University Questrom School of Business

Got feedback on professors’ picks or willing to contribute? Get in touch at bschool@ft.com or add your selected articles and questions in the comments below.