It is a basic tenet of economics that regulations almost always have unintended consequences. While Adam Smith may have been one of the first to understand this, he could not have possibly foreseen the morass of expensive and unwanted consequences that could come from conflicting emission and fuel standards enacted by the state of California and federal programs, such as for greenhouse gases and Corporate Average Fuel Economy.
Both the state and federal regulations have worthy goals: to decrease greenhouse-gas emissions and lower petroleum consumption. Yet taken together, the federal standards effectively cancel out the California standard. Instead of promoting fuel reduction as intended, the California standard allows for the production of less-efficient vehicles, while facilitating a massive transfer of cash via credit trading. It also forms a de facto industrial policy that sends us down a path toward electric vehicles that may or may not be the best technological or environmental choice for the future.
A few years ago, thought leaders and experts around the world began to meet to discuss the slow pace at which business seems to progress in tackling the challenges of innovation and change towards ideal models of sustainable enterprise. The result of those discussions was the launch of a unique initiative called GOLDEN for Sustainability (“Global Organizational Learning and Development Network”). Never before has such a multi-disciplinary, large-scale research project been undertaken in the management domain.
Since GOLDEN’s launch, experts from all business fields including, innovation, organization, strategy, marketing, accounting, human resources, business ethics and operations have been working with environmental scientists and social scientists (economists, sociologists, political scientists, psychologists etc.) to engage corporations in field experiments and clinical research. The goal is to understand how to improve and speed up the pace of business transformation to sustainable enterprises.
While many graduating MBA students are still heading to traditional sectors like finance, consulting and technology, one of the biggest trends among top business schools is an increase in the diversity of students’ career interests. Perhaps it’s related to fallout from the financial crisis or even a generational trend, but more and more students are pursuing positions in a broader array of areas.
At MIT Sloan, about 60% of our MBA graduates in the past few years have gone to those traditional areas. Among our other MBA students, we are indeed seeing this trend toward diverse interests. Strong areas of focus for that group include: entrepreneurship; sustainability; energy; social enterprise; health care; operations and supply chain management; and entertainment, media and sports.
When it comes to sustainability, women are leading what was once an underground movement. They are enacting change from anywhere and everywhere within organizations whether it’s from the top down, bottom up or middle out.
Sustainability is no longer relegated to the “green team” or people with specific job titles. At women’s networking meetings, one of the most common introductions is: “This isn’t my formal role at the company, but it is my responsibility to influence.”
This is a powerful trend, as women have been playing a significant role in sustainability efforts within organizations for decades. In the early days of the Society for Organizational Learning’s Sustainability Consortium, an inordinate number of women were representing their company, signaling the opportunity to create a space of our own to provide mentorship and support. Read More »
Caroline Flammer, Lecturer, Global Economics and Management
We generally think of corporate social responsibility (CSR) as a sort of feel-good policy, as something that is good for public policy or public relations but not a company’s bottom line. But my research finds that good corporate citizenship can actually lead to superior financial performance. A company’s social engagement is actually a resource that can create positive value and improve competitiveness. Read More »