At Harvard Business School, a group of future corporate managers was talking about capitalism. What are its essential components? property rights. financial markets.
“Maybe it’s almost so fundamental that it’s too much to keep on board, but to lack?” Andrew Gibbs, 32, said. “Would it be capitalism if people felt comfortable?”
Deborah Spar, who teaches the prestigious “Capitalism and the State” course, said: “Would you even go so far as to say that a necessary condition for capitalism is scarcity, which will lead to inequality?”
Gibbs paused, thinking. “I would say yes.”
On the blackboard was: Capitalism. Shortage. inequality.
Today’s business school students are learning about corporate social obligations and how to rethink capitalism, a curriculum shift at elite institutions that reflects a shift in corporate culture.
The corporate phenomenon of socially responsible investing, or ESG (meaning Environmental, Social and Governance Index), has become a hot topic of political controversy – as well as a $40 trillion industry. Now the best business schools are entering the political arena.
Harvard launched its Institute for the Study of Business in the Global Society in October. Nearly half of the core curriculum at the Yale School of Management in Connecticut is devoted to ESG. Next fall, the Wharton School of the University of Pennsylvania will begin offering a Master of Business Administration with specializations in Diversity, Equity and Inclusion and Governance for Environmental, Social and Business.
What’s happening at Harvard, Wharton and other elite campuses offers a glimpse of the change in business. But at the same time, its graduates are highly influential in business, shaping the values and policies of the companies they may one day run.
Students and faculty are grappling with rapidly changing expectations about the role of business in society. Most of the students are vocal about the high paying jobs. However, they now face more probing questions from their classmates about how to balance their ambitions with a sense of social responsibility.
“We’re at Harvard Business School — it’s a bastion of capitalism,” said Ethan Rouen, who teaches the Harvard class “Reimagining Capitalism.” “However, I would say that if you look at the courses that are being offered, the institutions that are being built, and the speakers that we are bringing to campus, there is a need for both faculty and students to reconsider their obligation to the corporation. There is a big demand from the society”.
“The idea that companies should just make money is very much alive,” said Chinedum Agbosimba, 27, a student in Spar’s class. “But a lot of my classmates look at today’s world and say, ‘Yeah, clearly there are things in this system that we need to fix.'”
Business school leaders emphasized that their new concentrations and curriculum are responding to demands for political conversation in the corporate world, not advancing a progressive vision. “It is not because we are pushing an ideological agenda. That’s because it’s economics,” said Witold Heinz, Wharton’s vice chancellor and director of the ESG initiative.
And many students taking courses on challenging capitalism are not letting those big questions in the classroom overtake their ambitions.
“Basically, once a day I try to talk with someone from consulting or banking,” said Aaron Sabin, 27, a Harvard Business School student. “Usually, it’s not fruitful.”