June 6, 2008

Greener B-Schools, Greener Employees

This post first appeared at Harvard Business Online.

As an opening post on Harvard Business.org, I figure no topic could be more appropriate than the change happening at Harvard, among other places. I'm talking about the big shift in what business schools are teaching students and, more importantly, what those future business leaders want from their employers. According to a recent article in Newsweek, B-school's are greening their curricula. Students are learning how to weave environmental thinking into core business strategy and they're looking to apply it in the real world.

This isn't idle academic stuff. Top talent is increasingly demanding more from employers. As a survey run by Hill & Knowlton revealed, up to 40% of MBAs in some countries won't take a great offer from a company with a poor environmental reputation, and half don't even want to work in environmentally-challenged sectors like energy or autos.

My work - writing, talks, and advising corporations - focuses heavily on what's driving companies to seek green strategies and how to profit from these forces. A big part of the story is about stakeholder pressure, from innovative NGOs to shifting regulatory environments to B2B customers greening the supply chain to shifting consumer preferences. But I return again and again to employees because I believe that no stakeholder group is more important. A global talent strain and shortage is in the works across many industries. How will companies compete if they don't attract and retain the best people?

But companies should not think that the MBAs who are learning more about green business are only the ones with a deep moral commitment to the environment (and there are plenty), or that they are only looking to work for green-focused companies, such as Patagonia in the U.S. or IKEA in Europe. One of the most fascinating parts of the Newsweek piece is the opening profile of Ash Upadhyaya, a Stanford MBA from India. Even though he's been studying sustainable business, Ash wants to work for a private-equity firm and says, "Am I really driven to do this by my values? The honest answer is no...It just makes good business sense to be sustainable."

This profound shift in perception from seeing green as a moral cause to green as good business is the real story here - it explains why b-schools are covering it so much more, and why large portions of the student community are on board. It's a great thing for the planet that more employees see green as a core strategic issue, no matter what your company does (even perhaps private equity). I'm optimistic that planet- and market-changing innovation will be coming from these fresh new minds.

But I'm not optimistic for the companies that don't make the shift and actively court the new talent. Another theme in my work is that green isn't really optional anymore. With resource constraints a harsh reality, you get leaner and greener, or die. And that culling of the weakest in the herd will go much faster when the best people stop coming to work.

The lesson here is simple: without a clear commitment to sustainability, a strong message and tactics that bring that commitment to life, and measurable results, you will be unable to compete for talent in the coming years. In fact, you may already be at a significant disadvantage.

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