John Doerr photographed at Stanford University in Palo Alto, California on May 2, 2022
John Doerr has donated $1.1bn to Stanford University © Carolyn Fong/Redux/eyevine

Given the shortfall in the skills and knowledge needed to achieve global net zero emissions by 2050, many celebrated the news in May that billionaire venture capitalist John Doerr had given $1.1bn to establish a climate change school at Stanford University.

The new school will focus on a range of disciplines, from research into new technologies to the study of climate policy. It made no mention of business skills, though — leaving plenty of room for the world’s business education programmes to fill the gap.

However, according to one group of academics, they have not moved quickly enough to do so. “Although evidence of climate change has been emerging for more than four decades,” they wrote in the Harvard Business Review in February, “business schools have been late in acknowledging and responding to this urgent and existential issue.”

The article’s authors — faculty from Business Schools for Climate Leadership — are among those who want to change this. BS4CL is a new European business school coalition that was launched ahead of last year’s COP26 climate summit in Glasgow and believes academic collaboration could help fill the climate change gap in management education.

FT Masters in Finance rankings 2022

Students in a lecture at Cranfield School of Management, UK
The UK’s Cranfield School of Management is in our league table of postgraduate finance courses

Find out which schools are in our ranking of pre-experience postgraduate finance courses and post-experience programmes. Also, learn how the tables were compiled and read the rest of our coverage.

“Not all schools have the expertise it takes to design courses and some are better placed to draw on expertise from outside business school, so there’s a great dealt that can be done working across institutions,” says Colin Mayer of Oxford university’s Saïd Business School, one of the eight schools in BS4CL (the others are Cambridge Judge, HEC Paris, IE, IESE, IMD, Insead and LBS).

But lack of expertise is not the only reason schools struggle to make climate change a central focus of business degrees. Another is that business school rankings, including those of the Financial Times, tend to prioritise salaries — although the FT is progressively increasing the emphasis on wider criteria. This can deter schools from developing courses for students more drawn to global challenges, such as climate change, than making money.

Nevertheless, the topic of sustainability has become a feature of business masters’ curricula in recent years. “The number of courses that have emerged on this subject has been extraordinary,” says Mayer.

The University of Exeter Business School has created an entire programme — the One Planet MBA — to help students address global challenges such as climate change.

Bruce Usher, professor of practice at Columbia Business School, sees climate change becoming a more prominent part of the curriculum. “It’s become mainstream,” says Usher, who has taught climate finance as an elective since 2009. “It’s no longer a fringe topic, so much so that we’re working to integrate climate topics into our core courses and not just our electives — that’s a dramatic change.”

However, the problem is that, unlike Columbia and some others, most schools offer climate change topics only as part of optional courses, according to Mayer. “It’s increasingly embedded in the core course but the starting point has been that this is an elective,” he says.

Failure to integrate climate change into courses such as finance, accounting, marketing and operations has long been a cause for complaint among those pushing for management education to focus on climate change.

Between 1998 and 2012, the Aspen Institute’s Beyond Grey ­Pinstripes ranking, which every two years assesses the sustainability content in schools’ curricula, routinely found that environmental topics were covered as separate modules or elective courses but were missing from core MBA programmes.

“Your CFO’s office, the legal, accounting, procurement, supply chain offices have to be dealing with it,” says Mindy Lubber, chief executive of Ceres, the sustainable investor network. “No enterprise can meet its net zero targets if it doesn’t bring in all those parts of the business.”

Lubber would also like to see schools offer practical guidance on how companies can meet these goals. “It’s all about execution now,” she says. “We have some critical mass of companies and investors who have said they’re going to make a commitment to net zero — but what does that mean?”

She argues that students need courses on everything from implementing energy efficiency measures in their buildings and ensuring all vehicle fleets run on clean energy and setting an internal price on carbon. “We’re not seeing enough of that,” she says. “They’ve not got down to the granular level of what it’s going to take.”

Elizabeth Sturcken, managing director at US campaign group Environmental Defense Fund, agrees. “Students need to understand how the economy must transform in the next 10 years at a high level, then courses that train them in specific areas,” she says. “They need to understand how to turn high-level needs into practical action.”

Mayer hopes the changes can happen at speed. “Business and financial institutions are grasping this faster than business schools,” he says. “Business schools should be at the vanguard of the changes taking place, not at the rearguard.”

Climate Capital

Where climate change meets business, markets and politics. Explore the FT’s coverage here.

Are you curious about the FT’s environmental sustainability commitments? Find out more about our science-based targets here

Get alerts on Masters in Finance when a new story is published

Copyright The Financial Times Limited 2022. All rights reserved.
Reuse this content (opens in new window) CommentsJump to comments section

Follow the topics in this article