Doctors with MBAs: A New Prescription for Healthcare Leadership
May 9, 2024
Read MoreNovember 17, 2021
The New York Times’ Dealbook Newsletter recently reported on the increase in demand for courses on environmental, social and governance (E.S.G.) issues. Jenny Gross’s November 13th article notes that classes related to social entrepreneurship, climate finance, and impact investing – applying investment capital to companies focused on positive social or environmental outcomes – have become increasingly popular in business schools. Just this year, Duke Fuqua added “Business and Common Purpose” to their core curriculum. The goal of the class is to provide a framework for how to balance making a profit with the desire to make a positive social impact. Last year, second-year elective courses focused on social enterprise at Harvard Business School drew more than twice the number of students than in 2012.
Todd Cort, co-director of Yale’s Center for Business and the Environment at the School of Management, notes in the article that there’s been ‘an explosion’ of interest on the part of the students in these types of courses. So much so that professors at the school have started baking sustainability into the required core courses. That interest correlates with the growing number of jobs that require employees to understand E.S.G. issues. Companies are finding it easier to recruit junior employees for these roles, giving them the opportunity to start in higher positions than fresh MBA graduates typically get. The management consulting firm McKinsey & Company notes that global sustainable investment has grown 68% since 2014, creating more jobs and increasing salaries for those jobs.
According to Bethany Patten, senior associate director of MIT Sloan’s sustainability center, there will continue to be a growing demand for employees who have E.S.G. knowledge. However, trying to find employees to fill mid- and senior-level roles in sustainable finance is much more difficult. In the past few years, about 70 percent of the jobs that the sustainability recruitment firm Acre has filled have been newly created. According to Helen Pradas-Page (head of banking and investment at Acre) sustainable finance “…didn’t exist in the form that it does today.” PwC is facing similar recruiting challenges as it moves towards creating 100,000 new positions, many in sustainability and climate change risk. At the same time, they’re training many of their staff in the challenges of climate change.
Even with this promised surge in E.S.G. jobs, MBA graduates don’t tend to pursue them. Stanford saw 19 percent of their MBA graduates move towards social impact jobs (up from eight percent four years before), but that number for Wharton grads was only 1.8 percent. Some of this can be chalked up to lower starting salaries for sustainability jobs. Students with large MBA tuition debt have to make the hard choice of taking a job that allows them to pay off the debt quickly or choosing an impact job that forces them to carry their debt longer.
Luckily, some of the sustainability salaries are becoming more competitive, and students are increasingly interested in working for environmentally responsible companies, even if it means a smaller paycheck. Perhaps they see the same thing that Costis Maglaras (dean of Columbia Business School) sees – that climate change will completely transform businesses in the future – and they’re demanding the E.S.G. knowledge they’ll need to stay ahead of that transformation.
To read the full article, click here. If you’re interested in applying to business school to kick-start your sustainable future, contact us today!