An anonymous £15m donation to Exeter has enabled the business school to expand staff and premises

This year has turned out to be rather a good one for Exeter School of Business and Economics. Not only has its Association of MBA's (Amba)-accredited MBA programme been growing apace – applications are up 8 per cent this year with five students after each place – but in March it received an unexpected donation of £15m, the largest single gift to the university since Alderman Reed donated the beautiful Streatham campus 80 years ago.

Did that come as a surprise? "Yes," admits Alan Gregory, professor of corporate finance and acting head of the school until Professor Paul Draper from Edinburgh takes over in the new year. "Basically, the benefactor requested an interview with the vice-chancellor and said they would like to make a substantial donation for the university to further research and teaching in finance and investment. We did check out this person, who is very credible." Gregory suspects it is an alumni of the school, but doesn't know for sure – only two people in the whole university are aware of his or her identity.

After carrying out a feasibility study and bringing in outside consultants, the school decided to split this hefty windfall two ways: on human assets and a new building. Initially the faculty will be extended by four people, but that will be grown as student numbers grow, says Gregory, and they will also invest in some visiting faculty from the US and Europe. "We aim to get well-known people, from the corporate and academic sectors, and especially from the US. It's something that very few places in the UK are able to offer at that sort of level."

Next year the school will launch the University of Exeter Centre for Finance and Investment, or Xfi for short. As well as being used to attract top-flight academic staff, the funding will be used to develop strategic alliances with global investment companies and other business schools. In addition, the school plans a new office and study accommodation next to its existing school building, and is currently engaged with an architect to come up with a good original design that should be completed in 2002.

Research carried out at Xfi will support teaching across all the school's postgraduate programmes, including the MBA. "One of the main differences between us and other business schools is the number of courses other than the MBA," says Gregory.

Indeed the Exeter MBA itself already offers the opportunity to specialise in financial or marketing management. Students signing up for the general MBA, but achieving roughly half their subjects in finance or marketing, can elect to have a specialist title. "Around a third do in each subject," Gregory says.

In the last Research Assessment Exercise, the school, which offers a full range of postgraduate programmes focusing on finance, economics, marketing and international management, scored 5 (the top grade) in economics, accounting and finance. It is also home to the Centre for Leadership Studies, used regularly by blue-chip companies such as Marks and Spencer, Barclays, Natwest, Ernst and Young and KPMG for management training. It is also involved in several aspects of the MBA programme, including a leadership module.

Exeter's MBA programme has existed for 10 years and has had Association of MBA's accreditation for two. "In some sense people see that as the true start of the MBA programme," says Gregory. "We do put a lot of stock on it here as a way of differentiating ourselves from other programmes. Accreditation has moved us to the next level. It drove up the admission criteria and we made a massive investment in faculty as well, expanding the management side considerably."

But the school doesn't want to become a victim of its own success. MBA student numbers currently stand at 40 for the full-time MBA and 11 part-time. "We want to keep numbers small because we don't want to split classes," says Gregory. "We would like to keep it reasonably small and friendly – we don't want huge classes of 100-150 students."

The part-time programme in particular is still in its infancy and Exeter is trying to raise its profile with local businesses. "We've already got close links with local businesses so students can hook up with them," says Gregory. "But we place students with city firms as well, especially those with finance and investment options."

Without doubt an added attraction for students is the stunning surroundings. Located on one of the most beautiful campuses in Britain, the school is set in 400 acres of lakes, parkland, woodland and well-tended gardens. Not surprising then, that location was one of the top reasons cited by the current crop of students, along with accreditation and the quality of the faculty.

The surroundings are undoubtedly one reason why Exeter maintains a high intake of foreign students (standing at 60 per cent this year). The current crop includes students from India, Malawi, Mexico, Canada, Jordan, Germany, and France – bringing a uniquely international flavour to an otherwise quiet corner of Devon.