The rise of the ‘sustainable’ MBA

Xavier Duran has noticed a change in the students applying for MBAs at Alliance Manchester Business School in recent years: a growing interest in sustainability and responsible business practices.

“In the late 1990s, they came with a totally different set of expectations, when the MBA was a passport to jobs in consultancy, finance or banking,” says the director of MBA programmes. “Now, we find more and more applicants from the third sector who want business and management skills to mobilise in non-governmental groups and international organisations.”

These themes are becoming more widespread. Alliance Manchester is one of more than 200 business schools that responded late last year to a call from the Financial Times to find institutions active in responsible business practices. It is one of 20 schools highlighted by a panel of external judges, chosen for its focus on sustainability teaching.

Duran says a focus on sustainability reflects demand from students, business school accreditation bodies and employers. “They are looking for slightly different attributes from our graduates. They want them to be more global, versatile, able to navigate uncertainty and trustworthy. Responsible business is good business too.”

But there are divergent views over how best to teach responsible business practices and the potential trade-offs caused by their inclusion alongside more traditional skills. Also, should courses be compulsory or optional, integrated or offered standalone?

Responsible Business Education

At a time when campuses are under pressure to go green, MBA students want jobs with real social purpose. Read our special report.

A number of business schools have launched specialised modules and bespoke qualifications. Presidio Graduate School in San Francisco teaches an MBA in Sustainable Solutions. The University of Otago in New Zealand offers a Master of Sustainable Business and Hanze University of Applied Sciences in Groningen in the Netherlands this autumn launches an MBA in Purpose Economy.

The University of Wales has an online MBA in Sustainability Leadership. Macquarie Graduate School of Management in Australia, also highlighted by the FT judges, has offered an online global MBA since 2018, including topics on sustainability. Its face-to-face MBA includes 73 hours out of a total of 400 focused on corporate social responsibility, ethics and sustainability.

Megan Kashner, director of social impact at Kellogg School of Management at Northwestern University in Illinois, which offers 38 social impact courses to MBA students, points to longer-term pressures for change. A recent survey of incoming students showed nearly a quarter wanted a job focused on social impact after graduating, while nearly half wanted to do so later in their careers.

“It’s easy to say millennials are pushing on sustainability because they care,” she says. “I’m not sure it’s so much more than for Generation X and Generation Z, but they are coming into their professional lives at a moment when the needs have never been more stark.”

Students want purpose. There is a big shift that started for us three years ago and has really gone crazy in the last six months

The pattern is not limited to richer countries or to environmental issues alone. The Gordon Institute of Business Science at the University of Pretoria in South Africa offers a core responsible and ethical leadership course on its MBA and requires students to work on an applied business project focused on a social issue.

Nicola Kleyn, the dean, says: “Given the levels of social inequality, poverty and structural unemployment in Africa, it’s not an abstract academic concept. It’s something right in our backyard which we have to think about all the time. Business is being asked to contribute to solving social problems.”

Even at some prestigious schools which have traditionally focused on mainstream skills, responsible business education is taking hold. Ilian Mihov, dean of Insead in France, also singled out by the FT judges, says: “Students want purpose. There is a big shift that started for us three years ago and has really gone crazy in the last six months.”

Mihov says that since 2017 the school has added more core offerings on topics such as business and society, public policy and ethics, touching on themes that include inequality, the environment and tax avoidance.

“It is better to drive these issues into the curriculum,” he says. “If I create an MBA on sustainability, it will reach a self-selected pool of students which is already converted. That leaves a large group unaware who do not yet have a strong position.

“I want to change the mindsets of people who are not yet ready, to get to the people going to McKinsey and Goldman Sachs who will help with that transition,” he adds.

With such a wide range of courses and providers, fresh guidance comes from a new Positive Impact Rating, which polls current students. Backed by schools and business education bodies, its findings suggest that schools need to do much more to equip students with the sustainability skills they seek. The best schools embed the issues in their mission statements, governance and public engagement. A few symbolic electives alone will not be sufficient.