As corporate America reckons with the climate crisis, business schools are adapting MBAs to focus on climate and sustainability.
In May, The Wharton School of the University of Pennsylvania graduated its first cohort of MBA students with a new Environmental, Social and Governance major. The program came in response to the pressure climate change has placed on businesses and industries to grapple with related financial risks—and capitalize on the transition to renewable energy.
Along with studying traditional Master’s of Business Administration subjects like marketing and finance, the 52 students also delved into topics such as water governance, carbon offsets and greenhouse gas emissions.
Wharton, one of the top business schools in the country, launched the specialization in response to student demand, said Witold Henisz, vice dean and faculty director of the ESG Initiative. In its first graduating year, the major was already the school’s sixth most popular out of nearly 20. Today, two dozen faculty members from different departments contribute to the ESG initiative, performing academic research, devising industry partnerships and teaching.
While professors’ backgrounds range from law to policy, make no mistake: “This is ESG for business,” Henisz said. “We’re not training people to be environmental scientists.”
The program aims to teach students how to identify where and when ESG factors hit the bottom line, Henisz explained. About 80 percent of the school’s MBA students go on to careers in consulting or finance, where they increasingly need to consider how rising temperatures, climate policies or legal environmental battles put companies’ returns at risk.
But it’s not all about risk. The climate crisis presents plenty of growth opportunities for startups, Henisz said. The Apples and Amazons of tomorrow could be green technology companies, and he hopes they will be staffed with Wharton graduates.
“We’re not sure what they’re going to be, but this is clearly going to take innovation,” he said. “Some people are going to become fabulously wealthy and drive progress on climate transition.”
