Issue link: https://www.e-digitaleditions.com/i/56535
■ Teach a business model that promotes long-term sustain- able growth rather than the shareholder-centric model that externalizes costs and discounts the future. ■ Research and teach social innovation within business. ■ Teach graduates the skills that will allow them to give voice to their values once they're in the business environment. Business schools can be a great source of innovative think- ing about capitalism and the future. They can share best prac- tices about how business can contribute to a global sustainable society, and they can act as proving grounds for managers who need to practice putting their values to work. Business educa- tion may have a long way to go, but there is good news as well. The data suggests that the pace of change is picking up and many schools now have a story to tell. Many more are on the path to innovation—which they are more likely to achieve as they make these three critical investments. A New Model The first investment will require the most fundamental change: teaching a business model that emphasizes sustain- ability and shared value over shareholder primacy. While sustainable development means different things to different people, the most frequently quoted definition is found in "Our Common Future," a 1987 report generated by the United Nations' Brundtland Commission. It defines sustain- able development as development that meets the needs of the present without compromising the ability of future generations to meet their own needs. This simple concept is hard to argue with, and yet it is very much in conflict with what business schools teach about financial models and how corporations operate when practicing quarter-to-quarter management. Rethinking the simplistic, short-term paradigm of shareholder value and profit maximization may be the single biggest challenge we face in both business and education, and it is worthy of our best academic talent. The greatest benefit to emerge from our current financial crisis may be the clamor for a better business model. Business schools can be leaders in developing more sus- tainable business models. They can teach students that the freedom to operate requires considering the constituents all along the supply chain who are most affected by busi- ness decisions—employees, host communities, and their natural resources. They also can present case studies that show how society's demand for social responsibility affects growth. For instance, students can learn how a global cam- paign by labor and environmental activists influenced Wal- 32 BizEd JULY/AUGUST 2009 Mart's decision to move aggressively on alternative energy and other green innovations. Wal-Mart is joined by many other Fortune 100, 500, and 1,000 companies in their pursuit of "greener" busi- ness pastures. If that's the case, shouldn't business man- agers follow a sustainability model that allows them to lead rather than react to their changing circumstances? An Emphasis on Innovation The second essential change business schools must under- take is to spotlight genuine business-powered social inno- vation that tackles everything from poverty to climate change. Businesspeople are glass-half-full types who see a crisis as an opportunity when the rest of us are stuck in the quicksand of bad news. Today, social innovators are concen- trating their attention on developing clean fuels and creating markets at the base of the pyramid. Managers at all kinds of firms can learn to work from within to invest in socially beneficial business opportunities that also promote top-line and bottom-line growth. Business schools do a credible job of introducing students to the concepts of social entrepreneurship, or how to create new enterprises defined by their social mission. But they're not as good at teaching students social intrapreneurship— that is, showing them that companies can pursue multiple objectives, including both profit and social benefit. Often students with high ideals get the message that they need to join nonprofits or start their own companies if they want to tackle the big problems that plague us. Not only is that a limited view, it sidelines the most important engine we have for solving the world's problems: profit-seeking, globe- spanning, talent-rich business. In a recent article for strategy + business, journalist Marjorie Kelly examines companies that have achieved what she calls "mission control," an ability to balance profit with important societal benefits. For example, Interface, a $1 billion carpet