Embracing Stakeholders

Business schools are moving beyond shareholder capitalism

- Paul Keegan

On the role of business in society, the trend lines are clear: Shareholder primacy is out, and stakeholder inclusion is in. Jamie Dimon and Larry Fink, the chief executive officers of JPMorgan Chase & Co. and BlackRock Inc., respectively, were among the scores of corporate luminaries who in 2019 publicly made “a fundamental commitment to all of our stakeholders,” including the environment, employees, suppliers, and communities, as members of the Business Roundtable. Similar pledges are popping up everywhere from global gatherings of the business elite to advertisements for the Australian toilet paper maker Who Gives a Crap Ltd., which uses recycled materials and spends half its profits on building toilets and improving sanitation in the developing world: “Wipe your bum, change the world.”

Business schools have been slow to reflect this zeitgeist, but they’re rapidly making up for lost time. In September, the University of Pennsylvania’s Wharton School became the first large MBA program to offer a major in environmental, social, and corporate governance, standards used by socially conscious investors to vet companies. Harvard Business School (HBS) offers courses that ask students to question the very purpose of capitalism. And Columbia Business School has set an ambitious goal to become the nation’s top generator of leadership in the burgeoning field of social entrepreneurship.