Business Education
Corporate Social Responsibility

The rise of CSR in business education

Burgess COMMENTARY

Peter Burgess

The rise of CSR in business education MBA Feature

In little over a decade, businesses have gone from seeing corporate social responsibility (CSR) programmes and environmental stewardship as, at best, desirable add-ons to regarding them as central to strategic planning.

Linda Livingstone

“Early on, this movement was probably very much driven by individuals who had a personal passion,” says Linda Livingstone, dean of the Graziadio School of Business at Pepperdine University, and vice chair of the Association to Advance Collegiate Schools of Business (AACSB) International. “Some of them created their own companies around that passion, whereas others brought it into the companies they were part of. But I think as it has developed and become more widespread, companies began to realise it can also be good for business and it can be profitable.”

Some businesses are still accused of “greenwashing” - misleading PR exercises where they spend more on advertising their environmental friendliness than on actual sound practices. Such deceptions, though, are increasingly counter-productive.

Raymond Fisman

“There is a paradox here,” says Raymond Fisman, director of the social enterprise programme at Columbia Business School. “If consumers and/or employees get the sense that it is just about making more money, CSR loses its efficacy in bolstering the company’s image - and its profits.”

As organisations and consumers get wiser to the benefits of genuine initiatives in this area, business schools are also recognising this development in their MBA programmes.

“There was no social enterprise programme when I arrived at Columbia a dozen or so years ago,” says Fisman. “Now it is a major presence at the school. That should give you a sense of how attitudes have changed.”

Nikolai Sobolev

Nikolai Sobolev, a recent MBA graduate at Pepperdine University, focused on entrepreneurship and took the certificate in socially, ethically and environmentally responsible (SEER) business. He was already committed to social responsibility and sustainability, but wanted to lean more from the best, in this case Dr Michael Crooke, the former CEO of Patagonia who leads the university’s SEER programme. It focuses on profitability and quality products along with CSR and environmental stewardship

“I had seen CSR as stand-alone, one-off initiatives such as charitable contributions and didn’t see social or environmental initiatives as part of an overall business strategy,” Sobolev says. “Obviously, I knew about companies where a social mission is embedded in the fabric of their business, but I didn’t know that companies which build their business strategy on a foundation of corporate social responsibility can strategise better in a competitive market place.”

However, integrating all these elements into an effective business plan is no simple task.

“The closer you can get to the sweet spot, where these components come together, the better off you’re going to be in the long run,” Livingstone says. “But we teach students about the trade-off. For long-term sustainability, in financial terms and in other ways, you really need to think about all of those elements. We see it as an integrated strategy; you really can’t think about them independent of one another anymore.”

Since the SEER programme first began at Pepperdine, there are clear signs that student concern about concepts like environmental sustainability has grown substantially.

“In the last five years or so, issues around sustainability and a global perspective have become much more important to our students,” Livingstone says. “They have really pushed us to do more within our programme. They are very proactive.”

Fisman echoes those views, having noticed a major change in the way students entering MBA programmes think about “green” goals and how business can benefit society.

“But there is still an awful lot of fuzzy talk about doing good in the corporate world,” Fisman says. “I really think people [want to see] companies that can show them a clear case of combining social progress with business.”

Recent changes to the AACSB’s core values and guiding principles for business programmes have added a commitment to environmental sustainability and CSR to the criteria. Currently, the association has more than 670 accredited institutions in nearly 50 countries and territories.

“It is a natural progression given the trend [in the business world] in the last five years or so,” says Eileen Peacock, senior vice president and chief officer of AACSB Asia. “The Enron disaster had an impact and, following the financial crisis, we saw the major schools looking at their MBA programmes and wondering is this our fault or is it inbred in people to start with.”

Peacock Eileen

Because of business schools’ differing goals, Peacock sees the changes in eligibility standards as a background requirement rather than a demand to make specific amendments to curriculum content or policies.

Though Pepperdine may in some ways be ahead of this curve, Livingstone does think changes in the AACSB standards will have an effect.

“The mission in our business school is to develop value-centred business leaders and to advance responsible business practice,” she says. “So, to some extent, these standards are embedded in who we are. But I do think the standards will make us think a bit more systematically about what we are doing. No matter what we teach our students, in three to five years from now much of that will be obsolete. So passing on knowledge isn’t as important as teaching them how to think and of the need to continually learn.”

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