The Socially Conscious MBA

September 2007 Special Sections

Call it the silver lining of corporate malfeasance. The debacles of Enron, Tyco, and WorldCom may have bilked investors, emptied retirement funds, and inspired regulatory legislation, but they also helped to spark a new trend in MBA programs in Minnesota and across the country. Business students are still learning business fundamentals like leadership and strategy, but increasingly, colleges and universities are creating classes and entire programs centered on corporate ethics, nonprofit administration, social stewardship, and executive accountability.

“Business schools have to pay close attention to what employers are asking of their graduates,” says Rich Leimsider, director of corporate governance and MBA reform projects at the Aspen Institute, an organization that tracks social and environmental stewardship and curricula in MBA programs. “More and more, corporate recruiters and CEOs are saying they need people who can do marketing or strategy, but also handle ethical issues.”

In part, the growth of socially conscious tracks in MBA programs is spurred by larger changes in corporate culture, with shareholders demanding greater transparency into company operations, and environmental concerns and fair wage issues getting more attention. But the growth is also coming from the student body, says Leimsider. Many of those entering or currently in graduate school grew up not in the “greed is good” eighties, but in the turbulent Enron era and that upbringing fostered greater awareness of business ethics and corporate accountability.

Local Trends
At area universities, MBA programs focused on ethics and social responsibility are in full swing. At the Twin Cities graduate campus of Saint Mary’s University, there’s an Executive PowerTrak MBA with a corporate responsibility focus. At the University of St. Thomas, ethics training is woven throughout its full-time MBA program. At the Carlson School of Management, business ethics play a role in the regular curriculum as well as in global enrichment electives—study-abroad programs that span from ten days to six weeks and center on environmental stability, maturing economies, and development challenges in other countries.

“There’s a growing recognition that what’s good for society is also good for business,” says Brother Louis DeThomasis, chancellor of Saint Mary’s University of  Minnesota. “Business profits when people profit.”

Saint Mary’s was founded by the LaSallian Christian Brothers, a religious order that wanted to educate people toward greater social awareness, so every program has that as its basis, DeThomasis says. For its MBA program, for instance, Saint Mary’s has added capstone projects about sustainable development, environmental issues, and executive character. Every PowerTrak MBA student is required to write a strategic plan for a nonprofit, and another course requires them to address the issue of ethics on a global scale, comparing how business is done in the U.S. versus other countries.

“We’re seeing more people not just interested in getting a job or creating a career path, but actually making a difference in the world,” says Saint Mary’s MBA program director Karen Gulliver. “That creates more rounded individuals, and it’s exciting to think about their ideas being put into practice.”

The New MBA Student
An emphasis on social responsibility and ethics is attracting a new breed of MBA student, says Christopher Puto, dean of the Opus College of Business at the University of St. Thomas. “There’s a new type of student interested in becoming a highly principled leader,” he says. “The idea is that business can identify real needs in the community and deliver effective solutions while providing a safe, respectful work environment for employees. That’s the kind of company many of our students want to build.”

Under the leadership of Professor Ken Goodpaster, MBA students at St. Thomas have met with executives from several local companies (Medtronic, Toro, among others) and work on research projects that address business ethics, gaining a greater understanding of how ethical directives are employed at individual companies. They helped the James J. Hill Reference Library in St. Paul, for instance, establish ethical criteria for choosing strategic partners, vendors, and clients. 

In May, the Carlson School of Management launched its Center for Integrative Leadership, a jointly managed effort between Carlson and the Humphrey Institute of Public Affairs that aims to develop a better understanding of how business, media, academia, government, and nonprofits can help solve complex societal problems.

“We’re very interested in the intersection of business and public policy, and giving students a more broad-based knowledge,” says dean Alison Davis-Blake. “More MBA students are looking at issues of social responsibility and thinking about how they can fit into a changing corporate culture.”

Another draw for Carlson students is its chapter of Net Impact, an international organization that promotes socially responsible business practices and leadership. Carlson’s chapter is very active, says former president Sarah Shanley Hope, a recent grad who notes that her involvement with the group and her coursework at Carlson gave her a robust knowledge of environmental sustainability and corporate responsibility.

“There’s greater awareness about these issues in general, but I do think it might also be something about our generation that’s driving the interest,” she says. “The Gen X group of the eighties was all about making money, and our parents, who grew up in the sixties, were the opposite of that. Now there’s more of a balance. We want a career where we can sustain a nice lifestyle but also feel good about what we’re doing every day.”

Although the ethics-centered MBA programs at Carlson, St. Mary’s, St. Thomas, and other schools have been well received, the trend is only just getting started, says Aspen Institute’s Leimsider.

Curriculum changes take time to evolve, but at the same time, there are pockets of innovation that could drive further shifts toward socially conscious MBAs. Over the next five to ten years, Leimsider predicts that more professors with business ethics and social responsibility experience will gain tenure, and other schools will start thinking of integrating the topics into their MBA programs.

“Business schools will start to embrace these notions more because the whole culture of business is shifting,” he says. “Graduates of these programs won’t just be at the head of nonprofit organizations, but also the chief executives of global companies. And they’ll change how business is done.”