The EFMD business magazine

The EFMD business magazine

Our global context calls for global responsibility: Reflections on the role of business schools in meeting the challenges of our time

responsabilidad mundial

Climate change, together with the depletion of biological diversity, constitutes the most acute existential challenge to the long-term sustainability of human society on earth. These challenges are closely interlinked with the set of sustainable development goals identified in the Agenda 2030 adopted by the UN General Assembly in 2015. These goals have been widely and effectively communicated and constitute a skeleton for structuring a holistic picture of what humanity must do to establish sustainable conditions for its future.

In the aftermath of a two-year-long pandemic, we have faced a shocking deterioration of geopolitical stability manifested in armed aggression by Russian forces in Ukraine constituting a major breach of international law.

Report on climate change

Under the shadow of this turbulent situation, a worrying new report compiled by the Intergovernmental Panel on Climate Change was published on 1 March 2022.

The core message of the report was that human-induced climate change has already had widespread adverse impacts and caused related losses and damages to nature and people. Moreover, the report clarified the close interrelation between climate change and the degradation of ecosystems, most importantly the loss of biological diversity, and also outlined that safeguarding biodiversity and ecosystems is fundamental to climate-resilient development.

We have witnessed the development of strong social movements demanding increased political action

The report describes the effects already caused, the inappropriate responses that have been made to remedy the situation, while calling for effective actions to attain the goals set by the Paris Declaration. The seriousness of the overall message was amplified by the UN secretary General Antonio Gueterres who referred to the report as an ‘…atlas of human suffering and a damning indictment of failed climate leadership.’

70 countriesThe findings of the report should be seen in the light of the increased general awareness of the effects of climate change and the commitments that have been made with the objective of helping fulfil the objectives of the Paris Agreement. We have witnessed the development of strong social movements demanding increased political action, Fridays for Future being a prime example. Increasing societal engagement is also demonstrated by the fact that over 1,275 companies have signed the Business Ambition for 1.5°C commitment. More than 1000 cities, over 1000 educational institutions, and over 400 financial institutions have joined the Race to Zero, pledging to take rigorous, immediate action to halve global emissions by 2030.

After COP26 in Glasgow, more than 70 countries, including the biggest polluters – China, the United States, and the European Union – have committed themselves to an alignment with the Paris Agreement by making a pledge to attain Net Zero in emissions of greenhouse gases by 2050. These commitments cover about 76% of global emissions. To different degrees, these commitments have been translated into plans for implementation in combination with the allocation of economic resources for the necessary societal transformation. See, for example, the EU Green Deal with the stated objective of transforming the EU into a modern resource-efficient and competitive economy that ensures no net emissions of greenhouse gases by 2050, economic growth decoupled from resource use, and no person and no place left behind. There are a number of EU funding mechanisms in place to facilitate the Green Deal, totalling over € 1 trillion.

However, assessments of the impact of the nationally-determined contributions show that these are not enough to meet the target of the Paris Agreement.

In sum, there are clear indications that awareness of the need for action is increasing rapidly. At the same time, the alarming reports regarding the insufficiency of the moves so far to remedy the interrelated processes of climate change and the depletion of biodiversity demonstrate that this awareness has not been translated into necessary action.

Trends in societal development

Rather, it seems to be increasingly obvious that the room for political actions that are necessary to fulfil the objectives of the Paris Agreement are seriously hampered by a number of trends in societal development that, to different extents, have affected states all around the globe: Nationalist populist movements that claim to be the “true” voice of the people are gaining ground. The rhetoric of these movements is increasingly blurring the important boundary between opinions and statements of fact. Half-truths, conspiracy theories, and outright lies are presented as being descriptions of reality while the space for an open, reflective discussion of difficult issues is at risk of shrinking or being eliminated. Faith in democratic ideals is waning in many places and fundamental human and civil rights are increasingly being side-lined. At the same time, the established multilateral structures for international collaboration are being eroded while the imperial ambitions of authoritarian powers such as China and Russia are giving rise to strong geopolitical tensions.

One of the most worrying consequences of this development is the erosion of the established multilateral structures for multilateral cooperation such as the UN system and the WTO. As a substitute for failing multilateralism, there has been a rapid rise in regional or bilateral arrangements, in the format of ambitious preferential agreements as well as in new types of hub and spoke structures with asymmetrical power relations such as the Chinese Belt and Road Initiative.

The sustainability challenges we face all have global implications and they must be met by responses that are coordinated globally with clear commitments when it comes to the distribution of responsibilities. It is also clear that the most pressing challenges such as climate change and the loss of biodiversity can only be effectively met if we take into consideration the differences in resources between industrialised, industrialising, and less developed states. This implies an urgent need for effective inclusive structures for multilateral cooperation that are attributed powers to handle the balance between economic and non-economic interests This would require a legitimate linkage between the regulatory structures for international trade, capital mobility, and agreements to take the actions necessary to reduce emissions of green-house gases and safeguard biodiversity as well as the international agreements on core labour standards.

It is a sad paradox that, in a situation when the world acutely needs structures for effective multilateral cooperation in order to tackle acute existential challenges, the existing relevant multilateral frameworks are in a stage of erosion.

How can business schools contribute?

The challenges to the sustainability of our societies have increasingly been acknowledged by business schools all over the world. This acknowledgement has led more than 800 business schools in 98 countries to make a formal commitment by signing up to the UN Principles for Responsible Management Education, or PRME to integrate sustainable development into their research, education programs, and partnerships. PRME is an integral part of the United Nations Global Compact, founded in the year 2000, and the world’s largest UN initiative on responsible management education. Moreover, the two major systems for furthering quality development in business-related research and education, EQUIS and AACSB, have both included and successively developed sustainability-related criteria in their respective accreditation standards. There is also an increasing collaboration between business schools on responsibility and sustainability issues in network structures such as the Global Responsible Leadership Initiative, (initiative co-funded by EFMD and the UN Global Compact in 2004) and the Global Business School Network.

Several policymakers and business school leaders have promoted reforms of business education underlining the responsibility of business schools to help meet challenges to societal sustainability. Business schools have increasingly translated such initiatives into explicit strategic objectives in order to have an impact on societal development, furthering sustainability as well as making the internal operations of their school more sustainable.

However, the real effects of integrating sustainability perspectives in business school curricula and research agendas do vary, and we still lack a deeper understanding of the extent to which this actually has an impact on societal development. Nevertheless, I strongly believe that the trend that has been established must be furthered and that business schools will increasingly be prepared to meet up to their societal responsibility.

Turning to what ought to be done, I believe that a business school’s most important instrument to make an impact on societal development is its alumni.

Business education is an advanced, research-based education that leads to professional positions in society where the individual is vested with power to make decisions that influence the development of other individuals, organisations, and society at large. As business schools, we must acknowledge that we educate talented young people for positions in society where they will have the power to make decisions with large societal impact. Applying fundamental ethical values, we must therefore teach our students that with power comes responsibility. This responsibility transcends an individual’s own well-being and embraces the organisation in which he or she is active and the development of society at large. Business schools must consciously avoid educating self-interest-maximising instrumentalists.

As business schools, we must acknowledge that we educate talented young people for positions in society where they will have the power to make decisions with large societal impact.

Business schools are well-positioned to champion sustainable societal development through their educational operations. Obviously, this requires there to be a clear link between research and education and that the business school conducts high-quality research on sustainability-related topics as well as actively participating in international academic discourse, thereby contributing to a universal process of knowledge creation. The complexity of the issues confronting us warrants that we, when appropriate, apply multidisciplinary approaches to develop knowledge that is relevant for societal development. Basic research contributions should be translated into applied research projects in cooperation with external partners, thereby contributing to a process of impactful knowledge creation of high societal relevance.

In addition, in order not to be perceived as hypocritical and to establish legitimacy for the integration of sustainability perspectives in research and education, business schools must also live as they learn. They must in themselves be sustainable and as far as possible aspire to be role models for sustainable operations within their specific context. This would imply that business schools could be transformed into experimental laboratories for sustainable solutions.

Finally, business schools must address the hard issues that follow from contemporary societal development. In this, the fundamental ideal of academia as a free, knowledge-seeking force with a responsibility to contribute to the development of society takes on crucial significance. We must defend fundamental academic values, critical and independent thinking and the demarcation line between opinions and statements of fact. I also strongly believe that business schools must act to defend the idea of multilateralism, underling its importance for meeting challenges of a global dimension. This refers both to the way business schools operate and to the substance of research and education. Referring to the way we operate, global orientation includes a borderless exchange of ideas, international collaboration in research and education, and a continuous transboundary movement of students, faculty, and staff between different national contexts. All with the objective to enhance the quality in research and education through close intercultural collaboration and communication. In terms of substance, curricula, with a link to research, must include issues relating to the structural aspects of international cooperation and help students develop an understanding of the regulatory frameworks for regulating international economic relations including the tensions between multilateralism, regionalism, bilateralism, and unilateralism. Moreover, I believe that students must be provided with an understanding of how these structures establish balances between economic and non-economic interests and the extent to which they have potential importance for the attainment of a legitimate sharing of burdens in the efforts to meet the sustainable development goals.

By educating future decision-makers with a global mindset, combined with a clear understanding of the individual’s responsibility in a societal context, business schools can contribute to the common cause of meeting the pressing existential challenges to the long-term sustainability of the conditions for human civilisation.

Our global context calls for global responsibility

See more articles from Vol.16 Issue 02 – GRLI.

Per Cramér is full Professor of International Law and holds the Jean Monnet Chair in European Integration Law at the School of Business Economics and Law at the University of Gothenburg

Stay connected
Search Global Focus
Subscribe to the
Global Focus Newsletter