The New Business Class

The New Business Class

Each year, more than 100,000 students are awarded Master of Business Administration degrees at universities around the country. After learning the foundations of business basics, they're anxious to enter the workforce, make an impact, and -- of course -- make money.

With such an influx of ambitious and motivated new workers, there's a ripe opportunity to enact meaningful changes in corporate culture, recently burned by the scandals of the Enrons and Worldcoms of the world. But it all depends on whether students are well-versed in environmental and social corporate responsibility during their time in business school.

Change is certainly afoot in the workworld, with many companies taking on the challenge of improving their social and environmental records in the hopes of currying favor with conscious customers. Plus, a whole new breed of industries are starting up, focused on renewable energy, eco-certified building materials, and other 'green' products and services.

So how do today's schools shape up? Are MBA students taught awareness of corporate ethics, social responsibility, and environmental issues? Are schools playing catch-up with the changes in business? Or are they leading the charge, bringing forth a cadre of young, forward-thinking executives into the workplace?

The short answer is both yes and no. The nation's business schools are indeed stepping up to tackle the complexities of business and the trend toward corporate social and environmental responsibility, with established schools starting up new programs to focus on the issues. Smaller, alternative colleges have also instituted entire curricula based on greener business, in the hopes of providing a new template that other schools can mimic.

A broader look at the MBA landscape, however, shows there's still plenty of progress yet to be made.

The Beyond Grey Pinstripes project provides perhaps the best overview of how well business schools are doing in incorporating the concepts of sustainability and social and environmental stewardship into their classrooms. A joint project of the the Aspen Institute Initiative for Social Innovation through Business and the World Resources Institute, the project's surveys and analyses highlight the most innovative MBA programs and faculty infusing environmental and social impact management into the business school curriculum, while also exposing the areas where they could improve.

The project started with an initial report in 1999 and has issued subsequent reports every two years since, providing a historical record of the gains universities are making. This year's surveys have already been received, but the new report isn't due until October. Looking at 2001's data, however, gives a glimpse into how far the schools have come, and what more they still have to do.

Out of 403 surveys mailed to U.S. graduate business schools accredited by The International Association for Management Education, 82 schools completed the survey, forming the basis of the 2001 report.

While many of the schools reported that they're attempting to tackle 'triple bottom line' analysis and looking to fill newly created academic chairs in social entrepreneurship and sustainability, the Pinstripe report's authors found that "though these trends are encouraging, there nonetheless remains very little being done to integrate a broad vision of social or environmental stewardship into required MBA course work or to explore these dynamics through rigorous research. The issues tend to be captured in elective courses, or in volunteer and philanthropic activities, rather than in central business disciplines such as accounting, marketing, and finance."

The report's conclusions also found that progress on the sustainable business front tended to result from a dedicated individual on campus -- a "champion" -- rather than an outgrowth of an institutional commitment.

"Though the contributions of these individual 'champions' are unquestionably valuable, the fact remains that unless environmental and social impact training is integrated into the core curriculum, the majority of future business leaders will be denied the tools they need to consider and react to the full range of issues affecting their companies," the report concluded.

But the authors did cite notable progress since the 1999 report, with many school supporting new research, establishing new chairs in stewardship issues and launching or expanding centers that are dedicated to innovative business. A few top universities across the country have indeed started up such centers: The Haas School of Business at U.C.. Berkeley has created the Center for Responsible Business, Stanford Business School has the Center for Social Innovation, and the Tuck School of Business at Dartmouth has just begun the Initiative for Corporate Citizenship.

Yet despite the gains, the report noted that less than 20 percent of the top business schools in the U.S. offer any course or activity linking business with the environment or social equity. So there's still room for improvement, which with any luck will be reflected in the upcoming 2003 report.

On other fronts, however, signs point to improvement already well underway. Mark Adams, a manager Intel Corp., writes in a recent column that he's seen great strides made in incorporating sustainability into MBAs since his days as a business graduate during the late 1990s.

Adams is the leader of the Northwest Professional Chapter for Net Impact, a nonprofit, student-run organization for MBA students and alumni with interest in sustainability and green business. Since its origins in 1993 as Students for Responsible Business, Net Impact has grown to over 5,000 members with chapters in 75 business schools. It offers networking, a yearly conference and other opportunities for students and graduates to parlay their personal convictions into innovative business approaches.

"It seems that the MBA mentality is changing in part because of the diversity of those entering business school. In our class we had former attorneys, school teachers, homemakers, and Peace Corps volunteers," writes Adams. "Such students increasingly want to challenge the status quo and talk about issues including corporate ethics, human rights, and environmental impact in the classroom as well as in the boardroom. They recognize the value of running a business with all the company's stakeholders (and not just its financial shareholders) in mind."

Indeed, change in the business school climate is starting from the bottom and moving up. While Adams attests to students' interests in these issues, smaller, alternative schools are blazing their own trail by introducing entire MBA programs structured around the fundamentals in corporate ethics, environmental performance, and other indicators of sustainability.

The newest addition to this growing crop of alternative MBAs, which includes New College of California's MBA in Environmental Entrepreneurship and Presidio World College's program, is the Bainbridge Island Graduate Institute with its MBA in Sustainable Business Practice.

Libba Pinchot of the Institute said the goal of the one-year-old program is to provide a model that other schools can follow and also to get forward-thinking business graduates out into the corporate world.

"We're a pilot project in curriculum and case development. We keep our student size deliberately small, about 15 students per year," she said at the recent Oregon Sustainability Forum. "We're essentially an incubator to disseminate ideas out, and become a model for other programs."

Students in the program -- mostly professionals already in the workforce -- focus on "action learning," completing most of their coursework via distance learning and visiting the Institute intermittently for classes during the course of the school year. Earning the degree takes two years.

Libba's husband and co-founder of the Institute, Gifford Pinchot III, first entered the sustainable business realm by coining the term "intrapreneuring," which refers to the creation of small businesses within larger, beauraucratic organizations as a way inspire creativity.

The Institute is exploring how to put Pinchot's concept into practice through its Center for Innovation in Government. Pinchot told the Bainbridge Island Review the Center is focused on three goals: turning civil servants into entrepreneurs, turning groups with ideas into high-performance teams and turning concepts into business plans.

In the end, the Bainbridge Institute and programs like it, with their emphasis on combining sustainability, social responsibility, implementation and entrepreneurship, could be providing a peek into the future of business education. As pressure for change filters down from the business workplace and also works its way up through eager young students, MBA programs around the country could be hard-pressed not to adapt and change with the times.

It's fitting to end with a quote from Rick Bunch, Business Education Director for the World Resources Institute, which speaks to the potential to be found in programs such as the Bainbridge Island Graduate Institute:

"BGI's new MBA in Sustainable Business Practice is unique ... in the business education world and on the leading edge of a wave that will soon break. BGI's program incorporates precisely the training in sustainability and environmental stewardship that WRI's Beyond Grey Pinstripes report has identified as missing from most business school curricula. This program will have a major impact on business education across the nation by proving that training in business sustainability is practical, essential and increasingly desired by both students and employers."
Derek Reiber is managing editor of the news service. This column first appeared as the July 1, 2003, edition of greenTIDE, a weekly perspective on green business and sustainability issues.