Business schools need to get serious about sustainability

Business schools are perfectly positioned to influence sustainability, yet their role is both under-appreciated and insufficiently developed. When I left my job at the UN to do an MBA at London Business School in 2005, the topic barely got a nod. Since then, not enough has changed.

While the UN continues to publish reports on the dire effects of climate change on our planet, the response of management education has been a bit like cities adding bike lanes — haphazard and only done when convenient.

More than 800 business schools have signed up to the UN Global Compact’s Principles for Responsible Management Education, which were drawn up in 2007 and require them to submit progress reports. Yet, in my analysis of more than 1,000 of these reports produced between 2015 and 2020, I found that while some departments and institutions had shown leadership, sustainability had yet to permeate the system. The commitments made have ebbed and flowed, depending on the arrival or departure of engaged deans, staff and students.

The word “sustainability” is sprinkled around, serving too often to separate out initiatives rather than connect them. The proportion of reports that include at least a mention of the UN’s Sustainable Development Goals (SDGs) rose from 11 per cent in 2015 to 74 per cent in 2020. Fewer than 10 per cent demonstrated real engagement, though. Schools talk about sustainability, but too many of the activities they describe are weak, fragmented and superficial.

One in ten schools appears to have scanned courses for SDG keywords as a proxy for engagement. A few, such as the University of Gothenburg and Universidad Externado de Colombia, dig deeper to determine how and to what extent such ideas are included, but most take a box-ticking approach with little evidence to support their case.

Many use language that suggests the goals are a form of philanthropy rather than priorities relating directly to business’s self-interest and the health of the planet. Fewer than 10 per cent of the introductory letters by deans outlining schools’ strategic direction mention the SDGs. Others suggest they are fulfilling their responsibilities simply through their status as educational institutions.

Despite the growing number of sustainability-focused courses, most are electives, and their themes are often absent from the core curriculum, where these lessons may be undermined or even contradicted. Embedding sustainability in a core finance or marketing course could do more good than a sustainability course that fails to connect these issues to the world students will enter. That means most MBA students are being left behind. In executive education, where schools arguably could have the most immediate impact, the reports suggest sustainability is almost entirely absent.

Schools should not wait for a perfect solution but jump in and learn as they go

Another concern is that, while schools acknowledge the SDGs, their leaders are not fundamentally changing the way they operate. This includes the processes, incentives and training that influence daily behaviour. There is no coherent strategy and any specific guidelines are often separate from a school’s overarching objectives and mission. Sixteen per cent of the reports mentioned future objectives relating to the SDGs, but most are broad and unambitious — a proportion that has changed little over the years. While many schools say their primary challenge is engaging faculty, only a handful provide any relevant support. Although students are often credited for taking initiatives, they are not included in strategic decision-making that could lead to structural changes.

Schools are trapped in a business-as-usual mentality, cautiously seeking a balance between the need to update and the perceived need for the status quo. While businesses are advancing, business schools have some catching up to do.

First, they need to shift from relegating the SDGs to sustainability courses, centres or initiatives, and place them at the centre of their offerings and operations. Deans must introduce incentives to engage staff and students. Faculty are pivotal, given their influence on the curriculum and research.

Second, systems such as rankings to judge business schools must change. Success should not be measured only by graduate career choices and salaries. New metrics are required to capture this more complex landscape. The goal should be to prepare all graduates, not just a selected few.

Better reporting mechanisms are needed for schools to collect, understand and communicate their efforts and explore their impact with clear goals tracked over time.

Third, the global community needs to recognise the role of business schools in achieving the SDGs and to partner with them to support the transition. Too many institutions are operating in isolation rather than linking their work to specific targets and engaging with others.

Finally, business schools should be more courageous. They should set ambitious goals and work across disciplines — breaking down the silos in their institutions and across the SDGs. Most of all, they should not wait for a perfect solution but jump in and learn as they go.

Business schools can be a powerful force to transform our cultures and economies to deliver a sustainable future. While many have started to embrace the challenge set in the SDGs, collectively they have yet to step up.

The winners of the FT Responsible Business Education Awards 2022 will be announced on January 19