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A bitter dispute within McMaster University's business school, featuring allegations of harassment, bullying and abuse, has led to the resignation of the school's high-profile dean, former business executive Paul Bates.

"Comments we have received on the morale and culture of the school use metaphors of toxicity and virulence, speak of a divide between generations, and draw attention to a habit of relentless verbal assault," says a report released this week by a university advisory committee. "It seems [this culture]has been the reputation of the school for quite a while".

The report outlines years of infighting at McMaster's DeGroote School of Business and highlighted the difficulties universities face when they hire non-academics to run business schools.

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McMaster hired Mr. Bates in 2004 because it was looking for a business leader who could give the school prominence. The university wanted someone "who had a visible public profile and contacts [and]who would be a strong fundraiser and could serve as a positive external face on behalf of the school," the report says.

Mr. Bates had no university degree and spent his career in the brokerage industry. He was a pioneer in bringing discount brokerage services to Canada and was CEO of Charles Schwab's Canadian division until it was sold in 2002.

To overcome Mr. Bates's lack of academic experience, the selection committee recommended the administration appoint a senior and respected academic as associate dean - a practice at other universities.

The recommendation wasn't followed, leaving Mr. Bates "to his own devices to manage the school, with only the private sector as his model," the report says. Faculty members soon became "perplexed" about how decisions were made on important academic matters such as chairing tenure and promotion meetings, developing research policies and developing new graduate programs. That contributed to the "animosity and backlash" that developed against Mr. Bates.

By the time Mr. Bates's five-year contract came up for renewal in 2008, 80 per cent of the faculty opposed his reappointment but they were overruled by the university's board of governors. Many students and alumni supported Mr. Bates and praised his effort to build the $27-million Ron Joyce Centre in nearby Burlington, Ont., to house the school's MBA program.

The feuding came to a head last spring when the university's Office of Human Rights and Equity Services released a report that said dissension had become so bad, several faculty members were on medication for depression, anxiety and stress-related illnesses. In response, the university's president at the time, Peter George, appointed a three-person advisory committee to review the school's management. Among the committee's recommendation was the replacement of Mr. Bates.

On Thursday the university announced Mr. Bates will resign as dean but remain at McMaster in a new role focusing on strategy and development at the Ron Joyce Centre.

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In an interview on Friday, Mr. Bates said he hopes the report's findings about long-term problems in the department will "come through loud and clear."

"There have been some issues here for a very long time, and I think the challenge is that for whatever reason the university hasn't dealt with those issues," he said. "I came in good faith, I built a strong relationship with an awful lot of people here, and I made a strong element of my time here to focus on our students."

He added he believes a lot of his problems stemmed from his proposals for changing the business school, especially the new campus. "There were groups who weren't sure they wanted to do that. You add all of that into a mix of an environment where there was a bit of a culture that had developed, and it really reached a point where some very significant changes that had to be contemplated," Mr. Bates said.

McMaster president Patrick Deane, who moved into the top job just six months ago, said he is committed to following the reports' recommendations to improve the culture in the department. "The history of that faculty has been problematic for a decade, almost two decades," Mr. Deane said in an interview.

He said an interim dean should be in place by early March, but no search will be launched for a permanent replacement until significant changes have been made at the business school. He said it is too early to know what type of person will be recruited.

Mark Scattolon, who graduated from the business program last spring and is considering enrolling in McMaster's MBA program, said the report has damaged the school's reputation. "It's two steps backward because this controversy has shown that there has been a crumble in the leadership in the school," he said.

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Mr. Bates, he added, had put the school on the map. "His focus on innovation, growth and creating the best student experience has taken the DeGroote School of Business from crayons to perfume."

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