Benjamin C. Esty

Roy and Elizabeth Simmons Professor of Business Administration

Benjamin Esty is the Roy and Elizabeth Simmons Professor of Business Administration.  He served as Head of the Finance Unit (department) at Harvard Business School from 2009-2014.  Before that, he was the founding faculty chairman of the General Management Program (GMP), a comprehensive leadership program designed to create outstanding business leaders. Professor Esty currently teaches the introductory finance course in the first year of the MBA program, but has taught a variety of elective courses including advanced corporate finance and project finance. The project finance course, called Large-Scale Investment (LSI), analyzed how firms structure, value, finance and negotiate large capital investments. He also teaches in a variety of executive education programs and served as the faculty chairman for the Summer Venture in Management Program for 14 years (SVMP is a management training program for college students designed to promote educational diversity and opportunity--see the article describing the program). Professor Esty has received the Student Association Award for teaching excellence multiple times, the Charles M. Williams Award for contributions to student learning, the Apgar Award for teaching innovations, and the Greenhill Award for outstanding service to the school (twice).

His current research focuses on corporate finance, project and infrastructure finance, and financial strategy. His articles have been published in a variety of academic and practitioner-oriented journals. In addition, he has written 115 case studies, technical notes, and teaching notes on project finance, financial strategy, mergers and acquisitions, leadership, and valuation issues. Collectively, HBS Publishing has sold almost 1.2 million copies of his cases, and nine of them are currently or have been classified as HBS "bestsellers" (most popular designation). The case studies and notes on project finance are contained in a book entitled Modern Project Finance: A Casebook (Wiley).  Formerly, he was an associate editor of the Journal of Financial Economics (JFE), Journal of Money, Credit & Banking (JMCB), Emerging Markets Review (EMR), Financial Management (FM), Journal of Financial Services Research (JFSR), and Journal of Project Finance (JPF).  He was also an editor of the on-line journal called Financial Educator: Courses, Cases, & Teaching Abstracts (part of the SSRN) which publicizes the newest ideas in teaching materials, approaches, and methods.

In addition to his academic research, Professor Esty has served as a consultant to and led training programs for investment banks, consulting firms, government agencies, and multi-national corporations on a broad range of investment, financing, valuation, and leadership issues. These activities have ocurred around the globe including work with firms or organizations on six different continents. In addition, he serves as an expert witness and consultant for litigation involving project finance, corporate finance, and complex valuation issues; was an independent trustee for the Eaton Vance family of mutual funds; and was a director of the Harvard University Employees Credit Union (HUECU).  He currently serves as a director and member of the Audit & Risk Committee for Raymond James Financial, Inc. (NYSE: RJF), a diversified financial services holding company.

Professor Esty received his Ph.D. in Business Economics with a concentration in finance from Harvard University; his MBA with high distinction (Baker Scholar) from Harvard Business School; and his BA degree in Economics with honors and distinction from Stanford University.

  1. Finance II (MBA Required Curriculum)

    This course builds on the foundation developed in Finance I, focusing on three sets of managerial decisions:

    • How to evaluate complex investments.
    • How to set and execute financial policies within a firm.
    • How to integrate the many financial decisions faced by firms.

    The Finance II course is divided into four blocks of material:

    • Tools of financial analysis (credit market analysis, option pricing, valuation of interest tax shields, weighted average cost of capital)
    • Financial policy choices of firms (whether to finance with debt or equity, distributing cash to shareholders)
    • Financial market imperfections (costs of financial distress, transaction costs, information asymmetries, taxes, agency conflicts)
    • Deals and transactions (mergers and acquisitions, leveraged buyouts, hostile takeovers, initial public offerings)

    Keywords: Finance;

  2. Summer Venture in Management Program (SVMP)

    The Harvard Business School (HBS) Summer Venture in Management Program (SVMP) is a one-week management training program for rising college seniors designed to increase diversity and opportunity in business education.  This unique educational experience helps participants develop a broader understanding of the challenges business leaders face, the many dimensions of the business world, and the impact they can have on their community and the world through business leadership.

    Using the renowned case method of instruction, HBS faculty lead class discussions on current management issues. Participants spend evenings analyzing real-business cases, and use morning study groups and classes to examine and debate their ideas through lively interaction with peers and faculty. This is the life of an MBA student at HBS. The academic program is supplemented by presentations from HBS administrators and alumni who provide information about the impact of an MBA.

    Keywords: SVMP; MBA; Summer Program; Education; Management;

  3. Large-Scale Investment (LSI, MBA Elective Curriculum)

    Large-Scale Investment (LSI) is a case-based course about project finance that is designed for second-year MBA students. Project finance involves the creation of a legally independent project company financed with nonrecourse debt for the purpose of investing in a single purpose industrial asset. In 2011, firms financed almost $400 billion worth of capital expenditures through project companies, an amount that has grown and will continue to grow rapidly in the years ahead. As the name implies, the course focuses primarily on large projects those costing $500 million or more because they provide a clear window on how managers make important structural decisions and how those decisions, in turn, affect firm value and performance. At the same time, large projects often encounter financial distress witness EuroTunnel, EuroDisney, Dabhol, and Iridium, yet are critical to economic growth and prosperity in both developed and developing markets.

    The central theme of the course is that structure matters, which stands in sharp contrast to the neoclassical view of the firm as a black box production function and the assumption underlying Modigliani and Miller's first irrelevance proposition that financing and investment are separable and independent activities. Through this course, students learn how structure affects managerial incentives to create value and manage risk. Ultimately, students learn how to increase value through both investment and financing choices.

    Keywords: project finance; corporate finance; Corporate Governance; Valuation; Capital Budgeting;

  4. General Management Program (HBS Executive Education)

    Today’s evolving economy calls for multifaceted leaders who can apply a holistic view of business, identify emerging opportunities, and adapt their strategies to navigate periods of growth and turbulence. Through a unique and tightly integrated five-phase learning cycle, the General Management Program (GMP) at Harvard Business School (HBS) provides an action-oriented and collaborative learning environment to help you become an outstanding business leader. Emphasizing practical knowledge and personalized learning, the program presents an intensive, cross-functional perspective on leadership.


    Keywords: Leadership; Leadership Development; Business Education;