U.S. Business Schools Lack Social/Environmental Commitment.

Dec. 21, 2004

As the 21st century approaches, the environmental challenges facing the world are immense. Six billion of us now compete for a limited amount of resources. More than any other time in the history of civilization, we know our planet's limitations. Such awareness has prompted many of the world's leading corporations to become more environmentally responsible. Any observer of U.S. firms knows that protection of the environment is becoming closely linked to every step of the value chain -- from design to end use. While corporate America is recognizing its social and environmental responsibilities, the leading business schools in the U.S., where future leaders are being trained, unfortunately have fallen behind. According to a study of 313 business schools in the U.S. released earlier this month, less than 20% are training M.B.A.s to manage the social and environmental challenges facing business. The study, Beyond Grey Pinstripes: Preparing M.B.A.s for Social and Environmental Stewardship, was conducted by the Washington-based World Resources Institute (WRI) and the Initiative for Social Innovation through Business (ISIB), a New York-based program of the Aspen Institute. "With 100,000 M.B.A.s graduating each year, the implications for society are tremendous," says Jonathan Lash, president of WRI. "Think of the impact it would have if a generation of financial analysts and business managers had the tools to contribute to solving social and environmental problems while making a profit." Why have business schools not included classes where such skills can be learned? Rick Bunch, director of business education at WRI, says there are several reasons for the slow pace. Business schools can be huge, he says, and change often does not come easily. Also, to corporations hiring M.B.A.s, environment- or social responsibility-related expertise is not the type of experience sought. "It's clear that some of these business schools are responding to the cry of corporations but are wondering where the jobs are," says Bunch. Business schools in Europe seem to be ahead of their U.S. counterparts when it comes to teaching social and environmental responsibility. "There's generally a different attitude there about the social role of business," says Bunch. Clearly a transformation of sorts is needed. Rather than relying on environmental engineers or shareholder activists to prompt progressive action, corporations need to begin to recognize the value of hiring M.B.A.s that are trained to judge business decisions and processes not only for their financial value but also for their ethical validity. Companies need to be conditioned to look for this type of talent. At the same time, universities must recognize the importance of teaching students about far more than dollars and cents, or how to start the next "dot.com." Several universities have taken the step of offering loan forgiveness programs to students who work in the public and nonprofit sectors. Three schools -- Yale University, Stanford University, and Columbia University -- offer both loan forgiveness and internship programs. For students looking at mountains of debt after they graduate, there are few better ways to encourage career paths that incorporate some type of social or environmental cause. Bunch says business schools that have been most successful in incorporating environmental and social awareness in their curriculum have had faculty who have championed the efforts. Support from the dean and the rallying of M.B.A. students also has helped. But are a few voices among many enough? In an attempt to help inform the academic community and corporations about the status of environmental and social awareness programs at business schools, WRI and ISIB presented awards earlier this month to schools that have incorporated such programs. Four faculty members also were presented with awards. Schools receiving awards and considered to have programs on the cutting edge include: Cornell University, George Washington University, Rensselaer Polytechnic Institute, Tulane University, University of Michigan at Ann Arbor, University of North Carolina at Chapel Hill, University of Pennsylvania, University of Texas at Austin, and Vanderbilt University. Individuals honored as "Faculty Pioneers" included John Ehrenfeld from Massachusetts Institute of Technology; Stuart Hart and James H. Johnson Jr., Kenan-Flagler Business School, University of North Carolina; and Lester Lave, Graduate School of Industrial Administration, Carnegie Mellon University. With the 21st century on the horizon, a period of time when humanity's survival may well be determined, there is no better time for all U.S. business schools to consider incorporating social and environmental topics into course work and projects.

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