Responsible as well as profitable: Employers seek graduates with a social conscience

By Harriet Swain

Published: 14 June 2007

If any proof were needed for the link between doing good and doing good business, the story of how an Indian tyre manufacturing company is combatting Aids, seems to offer it. The strategy director of Apollo Tyres, one of India's leading tyre companies, recently studied on an international Masters programme in practising management (IMPM), a co-operative venture between business schools in six countries across the world. He used his time as a student to develop Apollo's sponsorship of HIV/Aids clinics in lorry parks across India, after the company realised that lorry drivers - their main clients - were also among those most likely to suffer from sexually transmitted diseases. Oliver Westall, who headed Lancaster University's involvement in the IMPM, says: "It was corporate social responsibility in the sense that it is providing a valuable service, but it was exactly what the company wanted, too, because it raised the profile of Apollo Tyres with their key customers."

No business school nowadays can afford to ignore the way business interacts with the world around it, in terms of global citizenship, ethics, employee relations, the environment, and community involvement, if it is to cater to the demands both of its students, and the companies that will later employ them.

The Aspen Institute's Beyond Grey Pinstripes world ranking, a biennial survey that ranks business schools according to the way they integrate social and environmental issues into their curricula and research, found the number of schools requiring a course in ethics, corporate social responsibility (CSR), sustainability, or business and society had increased by 60 per cent over the five years since 2001. The number of MBA courses dedicated to environmental sustainability had increased by 400 per cent. "This isn't tree-hugging, says Wendy Chapple, deputy director of the International Centre for Corporate Social Responsibility at Nottingham University Business School. "It isn't doing something nice. It's something we need to look at or we will lose competitive edge."

Jeanette Purcell, chief executive of the Association of MBAs, says business schools are simply responding to what companies want. "Employers want to make sure that the people they are employing at the top understand the impact of their management decisions on the environment and on society," she says. "For businesses it's at the top of the agenda and therefore it has to be at the top of business schools' agendas too."

Simon Deakin, senior research associate in corporate governance at Judge Business School, University of Cambridge, says demand for knowledge of these issues is likely to increase further. "There are more and more people working in the city in socially responsible investment roles, and interest in CSR and corporate governance is growing in importance," he says. He argues that pension funds have had a significant impact here. Corporate ownership in developed countries has now become widely dispersed, with companies owned less by rich individuals or families and more by unit trusts and pension funds. In the past five years, these funds have been putting increasing pressure on companies to take sustainability seriously. "If you are a pensioner you don't necessarily want a bigger pension if you are breathing more polluted air," he says.

Pressure is also coming from customers, which means that those companies dealing with them most directly are the quickest to respond. "Customers are right at the forefront," says Chris Bones, principal of Henley Management College. "Organisations who have to sell things to customers are next in the queue as far as awareness goes, the public sector is a bit further behind, and right at the back are politicians."

But also close to the front are MBA students, who are demanding more courses linked to corporate social responsibility for reasons of both career ambition and personal ethics. Dana Brown, university lecturer in international business at Oxford University's Saïd Business School says: "Students are interested in it because they have a sense of wanting to be a good corporate citizen."

Sara Gardiner, a former Regus operations director for Asia Pacific, who is studying for an MBA in corporate responsibility at Nottingham University Business School, says she decided to take the degree because, "I had got to the point in my life where I realised that business has the ability to make a big difference. I wanted to be in a position to combine my business skills with social responsibility".

This is not a new sentiment. The idea of business having a responsibility to its community dates back to the middle of the last century and beyond. In the 19th century, the Cadbury brothers took a keen interest in the welfare of the workers employed in their Birmingham chocolate factory, and John Cadbury devoted his retirement to civic works. Ditto Lord Leverhulme with his paternalistic community of soap factory workers, Port Sunlight. Bones suggests it was only in the Gordon Gekko/Milton Friedman world of the Eighties that business became fixated on profits to the exclusion of everything else - until the Enron scandal sounded a warning.

But the current interest in corporate responsibility isn't entirely a harking back. What is new, according to a number of business school academics, is the recognition that ethics can be good for business. "People don't say companies should be responsible not profitable," says Deakin. "They say companies should be responsible in order to be profitable."

But the way business schools are responding to this new mentality varies. Some put on special courses in CSR - although Nottingham is the only university to devote an entire MBA to it - others say they prefer to integrate the sentiments behind it throughout the degree. Some avoid the term corporate social responsibility altogether, arguing that business should be generally responsible - not just in social terms.

This is the view of Henley Management College, which from this year has restructured its MBA programme around the three themes of managing organisations, making business choices, and making a difference, rather than around academic disciplines such as human resources and marketing. "Issues don't come to you as marketing issues, or finance issues," says Bones. "They come to you in these integrated ways."

Lancaster University Management School has chosen instead to run a compulsory MBA course in global responsibility that looks both at what it is to be an ethical manager as an individual and what it is for organisations to behave in an ethical way.

And the Judge Business School has a course called corporate governance and ethics, in which students look at such issues as the rights and values of shareholders in relation to the board, while it also runs separate courses in environmental sustainability and corporate reputation. Deakin says: "Rather than having a single course on CSR it crops up in different courses as appropriate."

At Audencia Nantes School of Management, the first and last courses students take are compulsory ones in business ethics. Andre Sobczak, head of the school's Centre for Global Responsibility, says: "We want to open our MBA with this issue and make it the conclusion, and to discuss with students whether their vision has changed." He says the intention is to emphasise its importance. "We try to show our students that CSR isn't something that's beyond the commercial activity of the company but that it is possible to integrate it within all different aspects of a company."

This is a sentiment echoed by Gardiner, who is considering becoming a consultant in CSR when she completes her MBA at Nottingham. She looks forward to a time when the specialised Masters degree she has chosen won't be necessary. "I hope CSR will eventually be at the core of every MBA," she says, "and critical to it."

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