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The head of Edinburgh University Business School is intrigued by a fundamental question: why do business school academics not spin out more businesses?

Nick Oliver raises the issue as Edinburgh reveals it has secured significant investment from Haymarket Media Group to support its ambition to become a leading centre for studying the business implications of climate change.

Haymarket, which publishes ENDS Report, the environmental business publication, is backing an Edinburgh academic in launching ENDS Carbon, which aims to provide companies with the information they need to reduce their carbon emissions.

The venture will give organisations detailed reports, benchmarking their performance against their peer group. The first report – to be published this month – will evaluate the climate-change performance of the UK supermarket sector and is backed by Tesco, Asda, Marks and Spencer and Waitrose.

“Lots of companies have calculated their carbon footprint, but they don’t know whether it’s big or small compared to their competitors,” says Craig Mackenzie (pictured above), the Edinburgh Business School academic who will be director of ENDS Carbon.

Figures such as total carbon emissions, he says, do not mean much unless they are related to the size of a company and the nature of its operations.

“We will use like-for-like measurements – such as how much energy is used for each metre of refrigeration, which is by far the largest source of supermarkets’ carbon emissions.”

Prof Oliver (pictured left), who joined Edinburgh two years ago from Judge Business School in Cambridge, sees the focus on climate change as a key element in a strategy of developing specialisations to raise the profile and status of the business school.

Although Edinburgh University has been teaching business since 1916, there was a general recognition across the university and wider Scottish business circles that the school had not matched the international reputation of its host institution – or succeeded in tapping into the outstanding science base on its doorstep.

In 2007 when the school decided to make climate change an area of specialisation, it worked closely with the university’s internationally recognised school of geoscience. Last year Edinburgh launched an MSc in climate change and it is also developing an MSc in carbon finance, which will examine international schemes for trading emissions.

Given that options in business climate change are also offered in MBA and undergraduate courses, Prof Oliver estimates the school could have 300 students a year studying the subject.

“The idea is to send out a new cadre of people, primarily into the business world, which could mean the public as well as the private sector, who are well equipped in an understanding of the science of climate change.

“Lots of companies, faced by the prospect of regulatory pressure, are appointing or hiring carbon co-ordinators, so we see our people as being well equipped to take on those kinds of roles.”

Although Mr Mackenzie started life as an academic, he has spent more than 10 years running the socially responsible investment research teams at Insight Investment, the asset manager now part of Lloyds Banking Group and Friends Provident, the life assurance group.

He believes his background helped him to land the deal with Haymarket.

“I’m not sure conventional academics have the skills for becoming entrepreneurs. Preparing articles and teaching undergraduates does not necessarily equip you to write a business plan or market your idea to investors.”

Prof Oliver identifies a number of factors behind the scarcity of spin-outs by staff. One is that much of what academics can do commercially – such as consulting or executive education – is regarded as the core business of their department.

That said, he believes there is a “grey economy” around most business schools and the issue of private work.

“My own view is that those academics who want to do a bit of private work are usually able to do it and get enough to meet their needs without the hassle of creating a company. So the grey economy mops up the vast majority of the entrepreneurial drive.”

He would like to see more spin-outs from schools.

“The business of building a business from nothing, creating revenue streams, employing people, debating what is really of value to the people that will pay for it – all these are hugely valuable.”

Copyright The Financial Times Limited 2019. All rights reserved.

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