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Responsible Management Education
at a Time of Crisis
Higher Education at a Time of Crisis
29 June 2009
Copenhagen Business School
Lucia Reisch
CBS Center for
Corporate Social Responsibility (cbsCSR)
Founding Partner of The European Academy of
Business in Society (EABIS) in 2002
2008 was the year in which a new global
agenda was unveiled
In the first half of the year we faced several global crises (energy and
food), and the urgency concerning climate change was heightened.
These crises point out to a new important and crucial fact: as a result of
economic growth and the incorporation to the international markets of the
emerging countries (Russia, China, India and Brazil), we are now facing the
certainty of scarcity in the supply of natural resources in the world – in the
areas of food, energy, water and climate.
2008 was the year in which a new global
agenda was unveiled
In the second half of the year, we witnessed the collapse of the credit
system and a rapid spread of the biggest and most contagious economic
recession in our lifetime.
This crisis has presented the international community with some needs: a)
design and implement global recovery, b) reform of the IMF to cope with
economic distress in the developing countries, c) international financial
regulation, d) reform of the international monetary system, e) diverse calls to
rethink global capitalism (with more questions than answers)
This new scenario adds a note of urgency
to initiatives like PRME
PRME: a global call to change the curriculum, research and learning
methods of management education, incorporating at the core of the
vision, the tools and the skills taught, the values of the United Nations
Global Compact
The Principles for Responsible Management Education
As institutions of higher learning involved in the education of current
and future managers we are voluntarily committed to engaging in a
continuous process of improvement of the following Principles,
reporting on progress to all our stakeholders and exchanging effective
practices with other academic institutions:
Principle 1: Purpose
Principle 2: Values
Principle 3: Method
Principle 4: Research
Principle 5: Partnership
Principle 6: Dialogue
• 235 signatories
• Reporting: Sharing Information on Progress every 18 months.
• Growing number of activities (Anti-corruption, Poverty as a
Challenge in Business Education, Climate Change, Travel
Studies and Learning Methods…)
Two key questions
a) Are responsible companies satisfied with the average
professional going out of the business schools?
* 76% of senior executives say that it is important they have the
knowledge and skills to respond to trends like resource scarcity, the
low carbon economy and doing business in emerging markets
* Fewer than 8% believe these knowledge and skills are being
developed very effectively by their own organizations or business
(Developing the Global Leader of Tomorrow, Survey - Matthew
Grisham - PRME Global Forum)
Two key questions
b) Is it necessary to consolidate the legitimacy
of management education?
We are not apart from the decrease in trust and legitimacy of
the financial sector
We confront a big wave of change in the near future…
4 changes in the landscape…
1. At the end of the current crisis, CSR will probably be “upgraded”
into something more holistic: a new definition of the nature and role
of the private corporation (and its relationship to society and the
common good).
This will mean a transition to a new theoretical model of the firm
reflecting the practices already in place, - a move from short term profit
maximization to profit maximization under the constraints of long term
growth (sustainability not just as an attribute of the company’s operations,
but as the core of the definition of the company itself).
Implications: new basic research on the theory of the firm and new
applied research in the field of public regulation and social regulation of
the firm.
4 changes in the landscape…
2. In the aftermath of the current crisis, we will probably see the
rise and demand for a new approach to management:
Managerial capitalism.
Thus, while the agency theory and the share value theory (and the
role they assign to managers) are being subjected to a revision, the
role of management will crucially be to balance the interests of a
diverse group of stakeholders, including workers, governments,
shareholders and communities (New York Times, 3/29/09 “How
Crisis Shapes the Corporate Model”).
Implications: new approached to strategic management, both in
basic and applied research.
4 changes in the landscape…
3. Introduction of new issues in business education: In order to
accommodate new visions of the firm and of management, educators will
have to incorporate into their teaching new substantive concerns and
issues as the core of the new role of the firm, - drivers of wise risk
management and sources of innovation and value:
•Human Rights and Labor rights
•Climate change, water scarcity, food security, renewable energy
•Transparency and anti-corruption
•Strategic philanthropy, social investment, shared value in the supplychain, new business models and MDGs
•Implications: 1) overall effort to update all disciplines in management
education. 2) Finances: risk management, valuation of assets and learning
methods that instill a greater sense of responsibility as a future leader and
4 changes in the landscape…
4. Integration of social and climate concerns: Finally, social and climate
concerns will have to be integrated into one single new value
proposition for responsible corporate behavior.
The environment is not any more an add-on to the economy but two
dimensions of the same reality, the greening of the economy towards a
low-carbon economic structure is not an add-on to economic recovery, but
a crucial component of recovery itself, and the green corporation is not
something different from the new role of the firm in society.
Implications: apart from some courses on sustainability, climate change
has not been integrated into educational efforts in the curriculum of
business schools.
4 changes are needed…to be leaders of the sector
a) Embrace the new vision of business, innovate the management
model the teach, adhere to these new values/concerns and
update their teaching to them, as the core of the DNA of the
firm, and…
b) …Do so through a collegiate and sustainable effort…
c) Will become the innovators…
d) and therefore the future leaders of the sector.