Businesses cannot deny climate change anymore, neither can management education

Climate Disinterest. Climate Ignorance.

These seem to be far more rampant than Climate Action. I would like to see this change in my lifetime. When I started Universal Business School in 2009, I saw that management education- by and large-  was focussed on the ‘case study method, which of course is useful only if the case studies are relevant. And relevance is a matter of what lies ahead of us, not behind us.

Are we preparing management students for the power shifts that lie ahead, thanks to climate inaction and high cost of energy?  Companies are already facing the heat, in the following ways-

1. Greater Risk: Often, business owners and top management don’t know what to expect- as they are operating under rapidly shifting regulatory and political environments. As countries put more pressure on each other for greater climate action, a sudden change in policy is a huge strategic risk.
2. Facilities Damage: Climate change is actually causing disasters such as facilities damage and workforce disruption. For eg; storms are expected to become more severe, with a variety of negative consequences for businesses.  This would of course cause obvious losses for insurance companies. Resources like food, water and energy are at risk due to both environmental and human causes, with the energy and consumer industries reporting the greatest impacts.
3. Trade disruption: International shipping could become more dangerous with climate change. Long-established agricultural regions could be decimated, upsetting supply chains.  Coastal communities and infrastructure could suffer repeatedly.

Next-gen MBAs/gree preneurs are our biggest hope

Given the above tectonic shifts, management students entering the corporate world are our biggest hope to make climate action and energy conservation a reality.  80% of professionals are already concerned about climate change, as per Deloitte Global’s 2021 Climate Check report. But the concern is not enough, we need to take action. Let’s look at China for instance- it is planning at least 150 new reactors in the next 15 years, more than the rest of the world has built in the past 35 years. China generates more solar power than any other country, about one in 20 cars bought in China is electric-powered. Their wind power installations are more than triple those of any other country in 2020. China is also getting greener at a faster rate than any other country, largely as a result of its forestry programmes designed to reduce soil erosion and pollution.

What’s important for the future is that as energy becomes costlier and more damaging, China’s political and economic power will grow as it can build nuclear plants cheaper and faster than anyone else and will offer this service to many other countries. So as an MBA student today, the opportunities to innovate and make energy cheaper and greener is imperative. So is solution-centric thinking about climate change and putting private equity money into sustainable projects. All business schools must have mandatory credit-based modules on Green Finance, Green Marketing, Green Supply Chain & Logistics and Green HR subjects into the curriculum which enable the students to develop a green mindset. Because while it may be of historical value to know what happened in General Motors in the 1960s, it is far more important to serve as the moral compass within contemporary organizations, encouraging profitable innovations that translate to sustainable business. Sound business education will also steer action away from ‘Greenwashing’- conveying a false impression or providing misleading information about how a company’s products are more environmentally sound.

COVID and climate change

Bill Gates argues that in terms of the death toll, climate change is as bad as COVID or will be soon. In his blog  gatesnotes.com , he demonstrates that climate change will cause 14 deaths per one lac people by 2060, the same as the COVID toll.

Therefore, just as we need new tests, treatments, and vaccines for the novel coronavirus, we need new tools for green energy and sustainability: zero-carbon ways to produce electricity, make things, grow food, keep our buildings cool and warm, and move people and goods around the world. And we need new seeds and other innovations to help the world’s poorest people—many of whom are smallholder farmers—adapt to a less predictable climate.

I would like to add further that a comprehensive response to climate change has to encompass the whole of education, not just MBAs. We have to tap into many different disciplines. We need biology, chemistry, physics, political science, economics, engineering, and other sciences to converge and find solutions. Hence, all education has to make the youth aware of the challenges of the future. Whether as greenpreneurs or professionals, a commitment to a better future is what will shape better earth. Thankfully, role models are all around us-  Google has committed to operating 24*7 carbon-free. They have realized that wind and solar energy will not be enough and are investing in new technologies like geothermal, nuclear energy, carbon capture and green energy storage solutions. Companies like Patagonia, Seventh Generation etc; all have found success by catering to consumers who make environmentally-conscious choices when they shop. How can business education be blind to the fast-evolving business environment?

The author Tarun Anand is the founder and chairman of Universal Business School, Mumbai. Views expressed are personal.

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