“We have created a monster with the MBA that should not exist,” said Paul Polman, the former Unilever boss who now chairs the Saïd Business School at Oxford. Warning that the qualification had “a narrow definition of success” and would become “obsolete” in one or two years, he told a meeting of deans at Davos last month that schools were failing to adapt their teaching to the requirements of the business community.
Mr Polman’s views are echoed by a growing number of business leaders who say that sustainability, purpose and responsibility are at least as important as profit maximisation at any price. They consider that business schools need to adapt their training and research accordingly.
“Our future is at stake,” says Clementine Roberts, head of Oikos International, a network of students committed to embedding sustainability into economics and management teaching. “Business schools are not moving as fast as we need to be equipped to face the challenges of today.”
Ms Roberts supported a Positive Impact Rating — where students rate schools’ societal responsibility and impact — launched this year by Katrin Muff, a consultant and former professor. The rating was compiled from the responses around the world of more than 2,400 students polled on their studies. From 50 business schools initially analysed, 30 received positive recognition but none achieved the top rating.
The students made a number of demands, including that sustainability and social impact training should be mandatory. They called for schools to reduce carbon dioxide emissions and food waste, exchange ideas on good practice with each other and prioritise gender parity among staff and faculty.
Just as stridently, they were clear on what they felt schools should stop doing; notably, investing in fossil fuels, treating sustainability as a “second class” concern, accepting funds from unethical companies and individuals, flying students abroad for courses and emphasising the principle of profit maximisation.
In response to such opinion, business schools are not standing still. Many have hired professors and launched institutes focused on sustainability, developed corresponding specialist qualifications and modules and reoriented their research.
“We need to create a new breed of leader,” says André Hoffmann, the Swiss billionaire backer of the Hoffmann Global Institute for Business and Society at Paris business school Insead. “Short-term profit maximisation is not the way to run a complex environment.”
The leading accreditation bodies have picked up such messages. The Association to Advance Collegiate Schools of Business (AACSB), the European Foundation for Management Development and the Association of MBAs all reflect similar trends in their latest guidelines, as well as initiatives to highlight best practices.
AACSB, for instance, is running an award for “innovations that inspire”. Similarly, the Responsible Research in Business & Management network is, through annual awards, nudging academics to produce responsible, applicable research.
Yet business schools have a tightrope to walk as they respond to contemporary demands. They have to balance a surge in calls for greater social purpose with the requirements of a still larger group of students, faculty and businesses that remain more focused on traditional research and learning.
Despite stagnation in MBA applications in the US, the global demand for management education is rising. The most sought-after careers among graduates of most business schools remain those in high-paying banking, finance, consultancy and technology jobs.
Andrew Crane, professor of management at the University of Bath, said at a recent discussion on corporate sustainability that only a small fraction of his students was focused primarily on the issue. Judith Walls, chair of sustainability management at Switzerland’s University of St Gallen, argued that while students and faculty on some courses were enthusiastic about corporate sustainability, those on the MBA programme were less interested.
Business schools, therefore, are left wondering how they might reform. Beyond the level of anecdote, scant consensus exists on what constitutes social impact or how meaningfully to quantify and compare what it involves.
At Oikos International, Ms Roberts is in little doubt that in order to change society sustainability has to become central to what business schools do. It must be ingrained in order to influence students furthering careers in private companies, as well as those pursuing jobs in the public sector or with non-profit organisations.
“Electives on corporate social responsibility are sticking plasters that don’t fundamentally change things,” says Colin Mayer at Saïd Business School, who chaired the Future of the Corporation, an initiative to redefine business and its relationship with society.
Answering the questions of how to solve the world’s problems profitably, furthermore, is not something business schools can do working alone. “We need to draw in different disciplines from across the whole university such as law and politics,” Prof Mayer adds.