CHAPTER 5
Beyond Green: Encouraging Students to Create a Simultaneity of Positive SEERS Outcomes
THE SLOW RESPONSE OF BRITISH PETROLEUM (BP) TO ADOPT A quick and comprehensive approach to the 2010 Deepwater Horizon oil rig explosion and spill (Isikoff and Hirsh 2010) reinforces the stereotype that business has little concern and competency to address major environmental challenges. Furthermore business schools have been slow to address ways in which education can be used for shaping the attitudes of future business leaders through socially and environmentally responsible curricula. These topics may be covered in one or two electives, but for the most part an across-the-curriculum approach to teaching these issues is rare. The Princeton Review didn’t start ranking business schools based on their coverage of environmental issues until 1997 (Green Colleges 2010), and Newsweek didn’t start its green business rankings until 2009 (McGinn 2009). No doubt this is because, beyond the activities of a few well-known programs and businesses, there was not much to report.
This dynamic is changing rapidly in response to an increased demand from a new generation of environmentally conscious students.* Today management faculty are exploring ways to engage in the kind of interdisciplinary approach to curriculum development that is needed to shape how future entrepreneurial leaders act in relation to this topic. Similarly, business leaders are beginning to measure the extent to which their activities have a negative and positive impact on the environment, and leadership conferences are placing environmental issues at the top of their agendas.
This chapter provides a historical context for the relationship between business and environmentalism and discusses how business schools, particularly our own, are tackling this issue. We also examine how co-curricular activities that inspire students to explore their own impact on the environment are used in conjunction with curricular changes.
The Historical Context for Business
and Environmental Sustainability
When the first Earth Day celebrations took place in the United States more than 40 years ago, the business community often positioned itself in direct opposition to environmental concerns. President Ronald Reagan, perhaps the greatest champion for business and deregulation, was famous for dismissing the problem of global warming by stating that trees caused more carbon emissions than industrial pollution. He even appointed conservative attorney Ann Gorsuch Burford to head the Environmental Protection Agency, and she made it her mission to minimize the enforcement of environmental regulations (Shabecoff 1989).
In the ensuing years, the relationship between the business world and environmental protection groups remained fraught with conflict. One well-known megalawsuit brought by the victims of the Exxon Valdez oil spill typifies this. Exxon repeatedly resisted fulfilling its promise to make spill victims “whole,” by engaging in a 20-year effort to reduce the $5 billion punitive award rendered against it down to $507 million. By the time of the final damage award ruling against Exxon, “more than 6,000 claimants had died without any closure, and untold numbers had reached the brink of bankruptcy” (Ott 2008).
Still it would be a gross exaggeration to categorize all for-profit leadership as anti-environment because many of the strongest advocates for the environment have come from the business world. Many companies have pushed for the adoption of market-based approaches, such as the current 20-year-old system that allows companies to trade pollution credits so that they can “cheaply reduce emissions at one plant, and not reduce pollution and perhaps even increase it at another plant, but overall across the country reduce emissions” (Mieszkowski 2004). While admittedly controversial because it still allows for the production of problematic pollution, this scheme has produced reductions in overall pollution levels nationwide. Similar approaches are used internationally to enable countries to reach their emissions targets by allowing them to “buy carbon credits from other nations, which either have no emissions targets … or have reduced their emissions below their agreed target” (Laurance 2007).
Today some companies are partnering with activists to create solutions to environmental problems. For example, Greenpeace historically staged high-profile actions to draw attention to corporate practices that harm the environment. In 2004, however, it began working with the electronics industry to help make supply chains greener, remove toxic chemicals, address climate change, and take responsibility for e-waste. “Through toxic chemical testing, exposure of illegal e-waste transfers, and promotion of greener alternatives, Greenpeace has catalyzed improvements to the environmental and health performance of companies like Apple, HP, Sony, Nokia, Philips, and others” (Herrera 2010). Similarly, McDonald’s partnered with the Environmental Defense Fund in the 1990s to reduce the environmental impact of its packaging (Environmental Defense Fund 1999).
What Is Happening at
Business Schools Today?
Environmental Leadership, a Component
of Entrepreneurial Leadership
Both in and out of the classroom, business schools are demonstrating leadership around environmental sustainability issues. In so doing they are modeling for students how to manage these issues when they become entrepreneurial leaders. First, many schools have signed the American College and University Presidents’ Climate Commitment (ACUPCC), “a high-visibility effort to address global climate disruption undertaken by a network of colleges and universities that have made institutional commitments to eliminate net greenhouse gas emissions from specified campus operations, and to promote the research and educational efforts of higher education to equip society to re-stabilize the earth’s climate” (ACUPCC 2011). After Babson signed on to the ACUPCC in 2009, we reduced energy consumption by 6 percent in one year.
Second, some schools are demonstrating their SEERS perspective by encouraging students to create personal solutions to the kinds of environmental problems that the ACUPCC seeks to solve. For instance, our undergraduates can choose to live in a special-interest dormitory, called the Green Tower, where they can connect with others who share similar values, generate ideas about how to make the campus more environmentally sustainable, and brainstorm about the creation of earth-friendly entrepreneurial projects. One of the innovations that came from the Green Tower was a bike-share program to help reduce auto emissions on campus. The Green Tower also hosts a “dark dorm” competition to inspire other students to reduce their energy use in the dormitories.
In our graduate program, a student club hosts one of the largest annual conferences on green technology in the country—the Babson Energy and Environmental Conference. The conference exposes participants to “emerging business strategies, innovative companies, and clean technologies that are driving this sector forward” (Babson Energy 2010). Following creation logic, the club connected with the Green Tower and together they persuaded the college to install a wind turbine that contributes to the reduced use of nonrenewable energy sources on campus.
Finally, universities can partner with one of the new entrepreneurial ventures that have emerged to help colleges reduce their carbon footprints and mentor students in the process. One such venture, Greener U, has an Eco-Rep Program in which student representatives are chosen to be “environmental change agents” and are taught “practical skills in communication, social marketing, and green event planning.” Student reps are encouraged to pick an issue that is important to them and develop a plan of action to educate their classmates about the issue, with the ultimate goal of convincing them to live in a more environmentally conscious manner (Babson Energy 2010). We have been working with Greener U since 2009, and the relationship has given rise to new environmental and economic opportunities that students are pursuing. Hopefully, these experiences will prepare students to follow in the footsteps of Jim Poss (see chapter 1) and find economic opportunity embedded in environmental issues.
Co-curricular activities provide students with opportunities to become part of the solution to environmental problems and to experiment with new ideas. Through co-curricular experiences around SEERS, students are able to employ both creation and prediction logics to explore and pursue social and environmental opportunities. Through action experiments in which they build new relationships and gather new data, students develop the skills to create social and economic opportunity.
Businesses can adopt similar programs by allowing employees to attend conferences, work with others who are passionate about environmental issues, and experiment with actions that will solve the environmental problems in their organizations. This approach mirrors the action experiments that Robert Chatwani took at eBay before launching WorldofGood.com (see chapter 4).
Programs in Environmental Sustainability
Business schools are adopting different approaches to building curricula that cover the relationship between environmental and economic responsibility and sustainability. Several schools are creating curricula that leverage the strengths of different disciplines and even different programs. For instance, the Yale School of Management offers a joint MBA/master’s of environmental management in partnership with its School of Forestry and Environmental Studies (University of Wisconsin 2010). The University of New Hampshire launched a new EcoGastronomy double major that enables students to integrate “sustainable agriculture, hospitality management, and nutrition through a selection of courses relating to climate change science and policy, marine sciences, sustainable engineering, environmental sociology, as well as a sustainable living minor” (Green Honor Roll 2010).
Another innovative partnership between Babson College, the Olin College of Engineering, and Wellesley College launches in fall 2011. Called Innovation, Design, Entrepreneurship, Arts, and Sciences (IDEAS), this program will be undertaken “alongside any degree program. Students can choose among a common set of courses that will emphasize a liberal arts (science, social science, and humanities) understanding of environmental issues, the role of business and entrepreneurial leadership in solving environmental problems, and an appreciation of how the practice and process of engineering and design can contribute as well” (Babson, Wellesley, and Olin Colleges 2009). Introductory and capstone courses will help students integrate the themes and the issues that arise across disciplines and campuses to develop new and insightful ways of addressing some of the world’s major environmental challenges.
These types of programs bring a diverse set of students together and provide a wide variety of courses of study, creating an understanding of multiple perspectives and deepening future entrepreneurial leaders’ awareness of the complexity of solutions to environmental concerns.
Teaching the SEERS Worldview:
Business School Curricula
At Babson, faculty are developing and delivering environmentally focused electives ranging from business courses, such as Financing Green Ventures and Marketing Green Products, to liberal arts and science courses, such as Economic Botany; Climate Change, Business, and Society; and Eco-tourism, Biodiversity, and Conservation Policy in Costa Rica. Aside from stand-alone electives such as these, faculty are also integrating materials about sustainability into core courses to encourage students to focus on what Babson president Leonard Schlesinger calls a “simultaneity of positive outcomes,” meaning building profitable businesses that are responsive to the needs of the environment and of humanity (Schlesinger 2010).
It is critical that a cross-disciplinary approach to sustainability is taken so that future leaders will recognize multiple perspectives and roles related to environmental sustainability efforts. To provide more-concrete examples of how to focus on the environmental component of SEERS, we describe a science course that is designed to teach business students the core concepts and applications of environmental science. We then provide details for a teaching case developed for a business law course on the regulatory and ethical climate for businesses. The course and the case that follow illustrate the cross-disciplinary contextual analysis that is needed to help entrepreneurial leaders cultivate a SEERS worldview.
A Course in Environmental Sustainability
Designed Specifically for Business Students
To be effective and innovative business leaders, students must understand and appreciate the environmental issues facing our world today. With this in mind, we teach a course that exposes students to the scientific causes of environmental problems, the impacts of those problems on both natural ecosystems and society, and the role that businesses unavoidably and intricately play. Our course in Environmental Technology was originally developed and delivered in fall 2003 and has undergone significant revisions every year to incorporate the latest developments in new technologies.
The course provides a holistic approach to SEERS education. The goal is for students to gain a scientific understanding of why we need to consider environmental sustainability in all aspects of future economic development. We specifically designed this course to teach future corporate leaders how environmental problems influence business innovation and how to recognize the resulting entrepreneurial opportunities.
The course is split into three modules. The first covers the world’s energy issues, focusing on fossil-fuel limits, pollution by-products, resulting climate change, renewable-energy options, and infrastructure restrictions. Many students are particularly interested in investing in or using renewable-energy forms, so we discuss the specific technology and the tradeoffs of various forms of “clean” power.
In the second module, we look at specific types of air, water, and solid-waste pollution, how this pollution is produced, what the impacts are for both human health and natural ecosystems, and how technology can be used to mitigate pollution. The third course module focuses on the over-exploitation of our limited resources, including water, soil, forests, and biodiversity.
Various case studies are used throughout the course to bring in specific examples of how businesses are involved in issues of environmental responsibility. Students are challenged to lead class discussions on relevant economic and ethical considerations.
One case study example that works well in this course is the Cape Wind Project, America’s first offshore wind farm. Energy Management Inc. has recently been approved to build 130 wind turbines in Nantucket Sound to “produce up to 420 megawatts of clean and renewable energy” (eCape Inc. 2010). Although many see this project as a positive direction for sustainable energy initiatives, a number of groups, including the Alliance to Protect Nantucket Sound, oppose the installment of the turbines. Among the environmental reasons for opposition are noise pollution; threats to federally protected birds, seals, fish, turtles, and mammals; and even an increased possibility of oil spill incidents. Beyond just the environmental concerns, there are also potential economic losses, such as declines in property values, reduction in tourism, negative impacts on the local fishing industry, job losses, and increased energy costs (Alliance to Protect Nantucket Sound 2010).
This case is particularly interesting because it clearly demonstrates the complexity of environmental issues by showing not only environmental versus economic tradeoffs but also the differing interests of groups that all consider themselves to be “environmentally friendly.”
During this course students are tasked with considering the impact of their own personal lives on the natural environment. One way they must consider this is by researching and writing a product impact statement for one simple product they use in their everyday lives. Plastic bottles, pens, paper, silverware, and printed silicone wristbands are just some examples of products that have been selected in the past. In doing this exercise, students research the environmental impacts involved in the manufacture, use, and breakdown of their chosen product. Many students are surprised to learn exactly how raw materials are obtained and how long it takes for various materials to decompose in landfills. This exercise along with the resulting class discussion encourages students to grasp the global impact of their own actions and consider alternative choices.
This course also has a semester-long capstone project that gives students the opportunity to be virtual entrepreneurs within the field of environmental technology. Working in small groups, students must invent and design a new environmental product or application that they believe is both scientifically feasible and commercially viable. They must then compile a written portfolio that includes details on the product design; the technology needed for the product to work; governmental regulations that may affect product production, use, or end-of-life disposal; target audiences; marketing slogans; cost predictions; timelines; and any ethical issues that may arise. In addition they must calculate the overall environmental impacts of their new product, both positive and negative. This project culminates in students pitching their new product ideas at an evening forum, where both professors and peers evaluate the potential of their unique products.
This capstone project allows students to see how environmental science, technology applications, ethical considerations, and business opportunities intersect to produce viable solutions to current environmental problems. We also see the effects of teaching students how to think as they engage creation logic to develop social and economic opportunity.
It is often assumed that business leaders must choose between environmental sustainability and profits, but this is far from true. In today’s world, society’s problems are business problems. Within this course we emphasize what has been recently reported in the Harvard Business Review: “becoming environment-friendly lowers costs because companies end up reducing the inputs they use. In addition, the process generates additional revenues from better products or enables companies to create new businesses” (Nidumolu, Prahalad, and Rangaswami 2009). Developing entrepreneurial leaders who understand the need for and the benefit of environmentally sustainable thinking and innovation is integral to society’s future progress, especially during economically difficult times. The case study of Bisphenol A (BPA) in plastic baby bottles also drives home this point.
An Interdisciplinary Case Study of BPA in Baby Bottles
This case was first taught in a business law course on product liability issues and ethics. When the case was first introduced in 2009, there was still a debate in the scientific community about the negative effects of BPA on humans, and the regulatory climate was not yet fixed. The case thus offered an excellent opportunity to teach students how to cultivate entrepreneurial leadership in the face of uncertainty.
BPA makes plastic containers shatter and heat resistant (Hopp and Kurfirst 2008). Because BPA acts like the hormone estrogen, many scientists point out the risk to children three years old and younger who use baby bottles and sippy cups made with BPA because these critical years shape the hormonal life of children (BPA Plastic Baby Bottles 2009). Not surprisingly, parents of young children have expressed the most concern about BPA, especially in relation to one of the most popular baby bottles on the market—Dr. Browns, made by Handicraft. Handicraft’s reaction was to dismiss consumers’ concerns and downplay the risks of BPA. During class discussion, we consider the cost of this kind of business reaction relative to the possible investments in finding alternative materials for products.
Despite concerns raised by parents, and an independent panel of scientific advisers about BPA’s health risks, the US Food and Drug Administration, the regulatory body charged with investigating and regulating such products, decided not to ban the manufacture of BPA for the uses described above (BPA Plastic Baby Bottles 2009). Without a federal law regulating bottle sales nationwide, consumers who believed that their children sustained health injuries because of BPA bottles use had to rely on negligence lawsuits to obtain some form of redress.
To win a negligence suit in most states, the claimant has to show the following:
A harm occurred.
There was a foreseeable risk that the harm would occur.
The defendant’s failure to prevent the risk caused the harm.
A company could defend against this claim by arguing that the risk was not foreseeable or that it took reasonable precautions to prevent it. One such claim against Handicraft was filed in the state of Ohio by a group of parents. They argued that BPA leeched into their children’s drinks and that Handicraft was “aware of the risks of BPA but intentionally and negligently misrepresented their products as safe and intended for use by infants and children in their advertising, packaging, labeling and public statements” (Ohio Residents File Class Action 2008).
To understand the complexity of taking action around these issues, students use this information to prepare for a mock-trial debate in which they are asked to represent either the bottle seller or the parents in a similar lawsuit. Here are questions student teams must consider:
Given the debate about BPA’s health risks, could they successfully argue before a judge that the company had serious reason to foresee those risks when it sold the bottles to parents?
Could other things have caused the children’s illnesses, such as exposure to other toxins?
If the answer to these questions is no, most likely the company would prevail in the suit.
The mock-trial assignment provides students with a useful analytical framework for thinking about how they as future entrepreneurial leaders could adopt interventions that both keep them out of court and are responsive to customer needs. Some of the interventions students have envisioned include having the company switch to glass bottles and giving more-conspicuous warnings on the labels of bottles made with BPA. All of these interventions could fulfill the “reasonable precaution” requirement in negligence law and enable the organization to employ a SEERS worldview.
Law, as we teach it, is a floor, not a ceiling. We therefore also encourage students to consider if creative ethical solutions can also satisfy the open-ended legal context. We assign an article on ethics that summarizes the views of various philosophers, such as John Rawls and Immanuel Kant (Oppenheimer and Mercuro 2005, 308–47). Students are asked to consider how Rawls’s difference principle—which permits a redistribution of goods held by well-off members of society to help the worst-off members of society—might be used. Such analysis helps students think about how to get Handicraft to shift its focus from its bottom line to developing a safer baby bottle that would benefit (or at least not harm) the infants using it. We also pay attention to Kant’s categorical imperative, a concept that encourages students to imagine themselves as one of those affected by BPA.
To help students grasp this issue from other perspectives, we encourage them to ask their friends and family about their awareness of BPA’s risks and, in particular, to get the views of mothers they know on the pros and cons of these kinds of bottles as well as the pros and cons of breastfeeding. Students learn that mothers report a variety of responses, including that they preferred plastic bottles because plastic is lighter than glass and thus easier to carry if you are going out with a child. With respect to breastfeeding, some of the mothers who worked outside the home opted not to breastfeed because they felt it was too cumbersome and that baby bottles afforded them more freedom. Moreover, not being able to breastfeed while at work was a concern. Quickly the discussion of environmental issues turns to social issues.
Indeed, borrowing from feminist theory and cultural studies, we introduce how contemporary activists are trying to “reposition breastfeeding as a valued part of women’s reproductive rights and lives … [so that] “women’s decisions to breastfeed … [do] not result in the loss of their economic security or any rights or privileges to which they are otherwise entitled” (Labbok, Smith, and Taylor 2008). By asking students to talk to mothers, we help them see the multidimensional nature of a SEERS worldview.
It is also important that students consider their own values and identity with their SEERS worldview, so part of the conversation focuses on their own personal preferences—to understand who they are and where they stand. We ask students to consider how they would want their own children to be fed. The majority of the class often decide that they personally would prefer not to use BPA baby bottles, which introduces the question of how they can transfer their personal values to business decision-making.
Finally, to connect the importance of creation logic and action, we ask students to develop business solutions to the concerns about BPA. Because entrepreneurial leadership can take the form of a new venture or occur inside an existing organization (Neyer, Neck, and Meeks 2000), students are encouraged to envision new entities or innovative changes in internal organizational policies that would speak to the legal, cultural, ethical, and environmental dimensions of the case. This approach also reflects the SEERS worldview, which avoids privileging economic value creation over social and environmental sustainability. Instead social and environmental sustainability become front and center when considering the various approaches for action.
The class developed a wide range of solutions. One team suggested that established organizations switch to a newly designed glass bottle with a plastic cover to reduce the risk of breakage. Another team suggested that there needed to be greater organizational leadership in existing workplaces to make them friendlier to new mothers by setting up private breast-pumping rooms and daycare for infants. Using a SEERS worldview, these teams created a social, environmental, and economic opportunity out of an unknowable and uncertain situation.
Conclusion
Environmental sustainability must be a key area of study in business schools today. This can be achieved using a number of different approaches. One popular option is for business schools to create specialty programs, such as IDEAS, devoted to SEERS topics. In addition, specific core courses can focus on environmental understanding and incorporate business applications. Our course in Environmental Technology is one example of how to do this successfully.
It is also important that schools show that environmental sustainability is relevant to all areas of study. Faculty can do this by incorporating examples similar to the case study on BPA, which looks at a particular business problem from a cross-disciplinary analytical perspective and guides students in developing critical and action-oriented thinking that produces safer, healthier, and more innovative and environmentally friendly products and organizational policies. By teaching environmental sustainability, business schools can help counter the negative impression left by companies like BP and Exxon and demonstrate that it is possible to create environmentally friendly and financially viable business and management models about which they can be proud.
Further, while this chapter shows how questions relating to environmental sustainability can be taught at the university level, most of these recommendations can be transferred to management development programs as well.
First, top leadership needs to model environmental stewardship by communicating throughout the organization that this critical issue is directly tied to overall business performance. Whether it is recycling programs, energy-efficient buildings, more fuel-efficient logistics, or new product design efforts, these programs enable entrepreneurial leaders to see the opportunities that are embedded in unknowable environmental problems.
Second, environmental sustainability must be built into everyone’s job. In a campus environment, this means that students, faculty, and staff are given the opportunity to participate in a variety of programs designed to cultivate greater awareness about environmental issues and promote a creation-oriented approach to addressing them. In other organizations it may mean that all frontline and back-office employees, from the bottom to the top of the organization, are involved.
Third, similar to the university training described in the BPA case, corporate training can occur in management development programs, encouraging employees to attend sustainability conferences or to get involved in new partnerships with NGOs.
Finally, responsibility for the implementation of environmental sustainability should not be relegated to just one person or group in an organization; it needs to be built into the whole business model.
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