San Francisco is considered one of the “greenest” cities in the world. So perhaps it’s no surprise that Bay Area business schools are among the leaders in teaching sustainability and CSR. One school – Presidio School of Management – specializes in it. We spoke to the school’s associate dean Nicola Acutt about the Presidio MBA program, and whether corporate sustainability will be the first victim of the financial crisis.
Will an economic downturn marginalize corporate social responsibility and sustainability?
I think it’s something that’s obviously on the forefront of a lot of people’s minds. I would say that now more than ever, there is a need for business leaders who have this kind of training and understanding. In an economic downturn, sustainability becomes even more critical. In strong economies, it provides opportunities. In weak economies, it provides opportunities, and can be central to survival and turnaround strategy.
In a downturn, one of the most important things is to tighten your belt and look at where you can be more efficient. That’s really at the core of an integrated bottom line: understanding how a sustainability-oriented strategy can reduce risk, cost, enhance reputation, ensure customer loyalty. Those are all key parts of the business case for sustainability and sustainable management.
But there must be some companies that still think of CSR and sustainability as ornamental; a nice extra, but expendable.
I think we’re going to see a shakeout of the companies that rushed to the green scene for the purely marketing and PR benefits. Those are the kinds of companies that are going to drop their commitment, because it’s not integrated into their operations, systems, IT, or core business strategy.
We’ve seen a remarkable change in how companies see CSR and sustainability recently. Years ago we were having to make the business case for an MBA in sustainable management. Now, the business case is being made for us. Some of the most compelling reports are coming out of the finance sector, about the bottom line business case for responsible management and stewardship. These economic times are really going to validate the depths of that commitment, and you’ll see the companies that have connected this to their core business strategy are going to be successful.
What are the skills that students get from your MBA program?
Four key skills. The first is understanding the principle of whole systems: ecology and economics and how they impact business. This is at the core of addressing some of the most pressing business issues, like energy, climate change, water shortages, etc. So, the capacity to think in whole systems – to connect the dots – that’s number one.
The second is being able to apply the principles in a way that helps guide business strategy: understanding these frameworks and how they can actually help business strategy move forward.
The third is making the case. It is one thing to understand these principles, but it’s another to be able to articulate the business case for sustainability.
The fourth is understanding how to apply emerging management tools that you wouldn’t necessarily get in a traditional MBA. You’ll get your core business skills and frameworks, but you will also learn emerging tools and beneficial frameworks like the integrated bottom line, stakeholder analysis, lifecycle analysis, full-cost accounting, G3 (Global Reporting Initiative) accounting – the sorts of things that you wouldn’t necessarily have access to otherwise.
How do you see Presidio as developing in this growing field?
Our teaching model is what really differentiates us from MBA programs that integrate environmental and social issues into their curriculum. How I differentiate Presidio is by using a 1.0-2.0-3.0 model. Some of the more established, traditional schools are at the 1.0 level, which means including some electives in sustainable management or enterprise, so that MBA students can take a class in these areas. 2.0 is integrating sustainability into every class in the MBA curriculum. Presidio does that. We integrate sustainability and social responsibility into all of our classes from accounting to strategy to finance – the whole gamut.
The next level up is 3.0, which is what I describe as an integrated curriculum. This means what you’re learning in finance and accounting is connecting to your operations class, which is connected to your marketing class, which is connected to your strategy class. This concept of vertical and horizontal integration across the experience, so that when you leave the MBA, you have the capacity to think in whole systems; to connect the dots across disciplines and functions in business.
Our goal is to create a different business education model with integration at the core, and that’s what we’re working on.
Photo courtesy: Presidio School of Management