Issue link: https://www.e-digitaleditions.com/i/54913
Watching Business Watch Itself externalities. The consequences of what one member of a community does, for better or for worse, will be borne by other members—just as I saw with the flower growers in Ethiopia. These consequences hap- pen whether or not those affected have the voice to protest. They may happen today or they may happen tomorrow in the commons of our shared earth. To Engage and Enlighten UNGC and PRME invite business educators to turn our attention to a part of our job we have honestly not done as well as we should have. In subtle but undeniable ways, through our focus and con- tent, we have let our students walk away from the bigger picture and their greater responsibilities. But we can reverse this trend. It is a profound privilege to educate so many young people whose col- lective talent, passion, and courage can lead to so much good. We owe it to our students to raise their sights to the big challenges of the present and future. We owe it to them to help them fashion narra- tives worthy of their intellects and hearts, in ways that honor lives rather than just livelihoods. A true business education must ultimately engage and enlighten stu- dents. With such an education, our students cannot help but feel a sense of urgency that the collective good of society depends on them. Carolyn Y. Woo is the Martin J. Gillen Dean of the Mendoza College of Busi- ness at the University of Notre Dame in Indiana. She co-convened Principles for Responsible Management (PRME), an initiative of the United Nations Glob- al Compact. As business schools consider ways to help students view themselves as accountable for—and to—the world, they also should be aware of how business is doing the same. There has been an explo- sion in the number of organizations that serve as watchdogs of corporate actions. On a trip to Hong Kong, as I was addressing the American Chamber of Commerce on corporate social respon- sibility, I found out that the Heng Seng Bank had recently created the Heng Seng Sustainability Index. The index will evaluate corporations using metrics similar to those employed by the FTSE 100 Index and the Dow Jones Sustain- ability Index. Such indices are wonderful steps in the right direction. They add to the abun- dant evidence of the potential for busi- ness to be powerful tools in promoting authentic human development worldwide. Bruce Piasecki, president and found- er of the management consulting firm AHC Group, noted that in the last 20 years, more than 70 rating groups have been formed. These include agencies that perform credit ratings and gover- nance scoring, as well as advise voting and proxy agents. Institutional Share- holder Services, renamed Risk Metrics, has expanded the evaluation of financial risks to include corporate governance and compliance, as well as legal, trans- actional, environmental, social, and reputational exposure. The proliferation of ratings groups is partly due to a public skeptical of com- panies' efforts to self-report. There also has been a call for third-party reporting protocols, such as the Global Reporting Initiative (GRI) and Dow Jones Sustain- ability Indices (DJSI), which provide a standardized format and a high bar for disclosure. The family of Dow Jones Sustainability Indices, employing the Zurich-based Sustainable Asset Man- agement's comprehensive risk evalua- tion system, now provides ratings for companies across all three major indus- trial regions of the world: the Americas, Asia-Pacific, and Europe. Because of the potential reputa- tional risks and benefits associated with these reporting mechanisms, firms of all sectors, sizes, and regions are paying greater attention to corporate respon- sibility across their entire operations. More corporate boards are turning to director training programs, recruiting environmental experts, and creating separate committees for managing climate and social risks. Yet, I sense something even more transformative: Corporate boards are recognizing that by finding creative ways to meet cus- tomer expectations for responsible prac- tices, they can derive significant com- petitive advantage and higher returns. That reality is important for business schools to acknowledge as they pres- ent topics such as sustainability and business ethics to students. CSR has become not just a responsibility, but a viable strategy for building stronger and more profitable businesses. Dean Woo, right, delivers an address at the United Nations in December 2008. BizEd May/June 2011 45