When CEOs talk, people listen. So when BlackRock CEO Larry Fink recently came out with a rallying cry for companies to be more socially responsible earlier this month, it made headlines. In a memo to fellow heads of companies, the investment firm leader declared, “To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate.”
In a later interview about his now famous letter, Mr. Fink continued, “Profits are paramount to everything a company does.” But he said BlackRock believes, “companies that have purpose are the best in the world.”
Business schools have and are continuing to take note.
“Increasingly, large global leaders are making very public and very significant commitments to integrating positive social and environmental impact into their core business,” says Fiona Wilson who is the executive director of the Center for Social Innovation and Enterprise at the University of New Hampshire and a professor of social innovation, social entrepreneurship, and sustainability, inside the school’s Paul College of Business and Economics. “Here you have the CEO of a firm as mainstream as BlackRock making a very public statement about the strategic importance of aligning a company’s profit-making initiatives with social and environmental impact issues.”
For undergraduate business students who have an interest in not just making money, but making a difference in the world, this is music to the ears.
STUDENTS ARE WORRIED ABOUT THE FUTURE OF THE WORLD
“This generation is one that is very, very interested in their careers being impactful,” says Laura Asbury, director of the Kelley Institute for Social Impact (KISI) at Indiana University’s Kelley School of Business. KISI is a center that offers extra-curricular opportunities specifically for Kelley’s undergraduate students. Everything from micro-lending and social enterprise consulting with local nonprofits to alternative break programs where students volunteer both domestically and internationally.
“I hear it so often, ‘The work that I do, I want to ensure it will have a positive and sustainable impact on the world,” Asbury says.
Lerzan Aksoy, associate dean of Undergraduate Studies and a marketing professor at Fordham University’s Gabelli School of Business echoes Asbury’s assessment about the current generation of undergrad B-school students. “It’s really amazing,” she tells Poets&Quants. “Consistently, research studies show that with this millennial generation, they all say they want meaningful lives and a career with purpose. Coming in, they have this mindset already.”
The other commonality business schools see from undergraduate students is that they are informed and they are concerned. These factors are further driving their interests in social impact. “They’re reading and seeing things happening all over the world. It’s so available to them that there’s no way of ignoring these big challenges,” says Carey Weiss the director of sustainability initiatives at Fordham. “They are deeply thoughtful about the future of the world and, ultimately, they’re worried. Not only do they want to make a difference, but they feel they need to.”
Current business students are also increasingly aware of the country and world’s current social issues like wealth disparity, explains Wilson.
“I think it’s coming from being aware of these big hairy problems that are going to be apart of their lives for decades to come,” says Wilson from the University of New Hampshire. “Many of them were quite engaged in politics in the most recent election, they’re very keenly aware of the huge disparities in income, the growing divide between rich and poor around the world, and many of them are social justice oriented.
“Their heads are not in the sand,” Wilson continues. “They see what the world is going to look like in 10-20 years and they’re pretty passionate about being a part of solutions to address things like climate change. They know they’re inheriting these problems, but don’t always feel empowered or equipped to be change agents. That’s why they’re attracted to these initiatives. They’re looking for concrete skills and tools to be change agents.”
B-SCHOOLS AND STUDENTS SEEM TO BE AHEAD OF THE CURVE
In the business world, companies seem to be catching up to what undergraduate business students already have a natural inclination for.
Kelley professor, Steven Kreft, refers to it as a slowing down of the greenwash momentum we’ve seen take place over the last several years. Everything was ‘go green,’ but there wasn’t “a lot of substance to back it up,” Kreft says. But that’s changing. “Companies are realizing they can’t just talk the talk, they have to walk it,” Kreft says.
While BlackRock and others ramp up their efforts and help spread the gospel of corporate responsibility, many business schools are already on the ball. Social impact and social innovation efforts are heating up as B-schools say their classrooms are filled with students who are fanatical about making sure their lives and careers help make the world a better place.