Dr Pierre Baret, Full Professor, Excelia Business School, France

Questioning the fundamentals taught in Business schools to help address the social, climate crisis

Business schools are somewhat paradoxical. They pride themselves on being at the cutting edge of innovation. And yet, they remain firmly focussed on contributing to continual economic growth by optimising production and stimulating consumption. This explains why they have remained deaf to social and environmental issues for a long time, despite the fact that these issues have been flagged up since the 1970s.

Introducing CSR in the curriculum of business schools

Similarly, academic studies highlighting the importance of Corporate Social Responsibility (CSR), initiated by some companies in the early 1950s, have not been adopted by business schools. Twenty years ago, the first business schools which introduced CSR into the syllabus of the Masters in Management programme were regarded like UFOs (unidentified flying objects), by students and faculty.

In 2024, not a single business school can ignore the urgent need for an ecological and social transition anymore. Consequently, all the world’s leading business schools now claim to educate students to become the responsible managers of tomorrow. To achieve this, over the past two decades or so, they have all gradually introduced and mainstreamed CSR across all their programmes. But this seems insufficient given the urgency and importance of the issues at stake.

Core subjects have remained unchanged for decades

Why is it insufficient? Because too often, B-schools are satisfied with merely adding CSR lessons to an existing syllabus of ‘fundamentals’, those core subjects that have remained unchanged for decades. In economics, students learn how to determine optimal productivity which seeks to minimise costs. Taking account of social and environmental damage is generally relegated to second place, if not completely ignored… as long as the law is respected.

In accounting, students are taught accounting regulations that are presented as intangible truths. In fact, they are conventions primarily aimed at informing investors about the various uses of financial capital and the resulting prospects. Far too rarely is the time taken to point out that these models and regulations don’t consider the impact on human capital or natural capital. Or if they do, it’s only to a very limited extent.

In finance, the goal is to learn how to outperform the market. If there is such a thing as green finance, it usually involves assuming a positive correlation between responsible commitment and financial performance. In marketing, the primary aim is to fuel consumption. Few courses focus on responsible marketing, which aims to encourage consumers to be more frugal. We could carry on with this list to include all the ‘core’ subjects taught in B-schools.

The cognitive dissonance of students

In the current context, adding CSR to the curriculum often results in making students believe that companies can become responsible without actually challenging their business model, i.e. that existing business models can simply be made a little ‘greener’ in order to respond to the social and climate crisis. Certain students don’t even question this and accept this ‘comfortable’ view. But such students are dwindling in numbers.

On the other hand, an increasing number of students feel they are faced with a cognitive dissonance between CSR modules that highlight the planetary boundaries and business models of unlimited economic growth that are also being taught. The more critical students are accusing business schools of contributing, whether intentionally or unintentionally, to ‘green washing’ that simply masks the issue.

The cost of reassessment of core subjects

This reassessment of the ‘core’ subjects comes at a cost. There is a cost for business schools who might be afraid of educating students in these matters so at odds with the expectations of employers who are solely focussed on financial performance. And there is also a cost for research-active faculty. In behavioural economics, all such costs are known as ‘sunk costs’. They correspond to the time that professors devote to designing courses in line with 20th century models. Those courses don’t take into account the challenges of the ecological transition. They are rooted in management science research which has tended to focus on economic and financial performance, productivity gains, minimising production costs, and driving growth.

However, there is no question that management sciences can be adapted and contribute effectively to meeting the challenges of the current pressing social and environmental issues. Already, there is a wealth of research work outlining comprehensive accounting models, marketing solutions to encourage individuals to behave more responsibly, sustainable finance solutions, the implementation of green supply chains, fair trade… and the list goes on.

Business school teachers need to embark on a new Copernican Revolution

At the turn of the 16th century, there was a much-needed Copernican Revolution. It was a difficult process. For many, it was unacceptable to believe that the Earth was not the centre of the universe. Today’s business school teachers need to embark on a new Copernican Revolution. Their entire curriculum must reflect the fact that growth cannot continue indefinitely, that it is not the only solution in the fight against poverty, unemployment, and economic inequality.

The focus on economic performance in the strict sense of the term is leading humanity down a blind alley. We can no longer continue to use teaching models that are totally removed from the realities of ecology and humanity. It is our duty to our students, and more broadly to our children, grandchildren, and the generations to come, to undertake an in-depth review of the core subjects, the ‘fundamentals’, in order to promote a sustainable world.