By Deanna C. White
As a professor of business administration at the University of Virginia Darden School of Business, a college widely regarded for its ability to prepare students to meet the social, ethical, and environmental stewardship issues of tomorrow, Dr. Richard Brownlee II is well versed in teaching sustainability topics to future business professionals.
But this school year, Brownlee and instructors across the country will be able to take advantage of a new tool to teach business and accounting students how to meet the growing demand of reporting on a business' social and environmental bottom line.
On August 17, in response to the growing need for curriculum that focuses on top sustainability business issues, Ernst & Young LLP and the Ernst & Young Foundation launched a case study for professors to use in their business and accounting classrooms. The case study examines the decision made by a fictional firm to begin to issue a sustainability report.
"Increasingly, stakeholders are requesting more information from companies about their environmental and social performance," noted Steve Starbuck, Leader of Americas Climate Change and Sustainability Services for Ernst & Young. "Future business leaders need to know how to respond to these kinds of requests and how to proactively incorporate these issues into day-to-day operations and strategies."
In response to the increasing momentum around environmental sustainability in the business realm, a growing number of undergraduate and graduate schools want to incorporate sustainability-related courses into their curriculum.
The Aspen Institute's most recent Beyond Grey Pinstripes survey found that out of 149 participating business schools, the percentage of schools requiring students to take a course dedicated to business and society issues has increased from 34 percent in 2001 to 69 percent in 2009.
"We wanted to be part of driving sustainability into the mainstream of undergrad and grad school accounting and business school curriculums," said Adam Carrel, Senior Manager, Climate Change and Sustainability Services at Ernst & Young. "While historically [a knowledge of] sustainability issues has been an option for business professionals, that is no longer the case. Being articulate in sustainability issues is at the core of their success."
Brownlee agrees that the focus on sustainability is here to stay. "Sustainability is a megatrend, like globalization. It cuts to the core of the interface between business and society. The notion of sustainability has moved into the C-suite. It is part of our strategy now."
"Over a relatively short period of time, sustainability issues and the opportunities they provide have demanded the attention of global business leaders, including those in the C-suite," Brownlee said. But despite the fact that students now routinely expect to be exposed to timely sustainability issues, case studies that have a sustainability focus are in relatively short supply, which is why the Ernst & Young sustainability case study is such a welcome addition to Brownlee's curriculum.
"My first reaction when I heard about this case study was 'good for you and thank you'. Case studies are hard to write and take a substantial investment of time and money. To have a case study that presents material that can be integrated into the curriculum by a credible organization and credible people is invaluable," said Brownlee.
Ernst & Young's Climate Change and Sustainability Services team developed the hypothetical case study based on experience in the field. They then shared it with the Ernst & Young Academic Resource Center (EYARC), a project of the Ernst & Young Foundation. The EYARC faculty was asked to develop complementary discussion questions and guidance to facilitate use of the case in classrooms.
"This is what we call an 'armchair case'. While the case study is fictitious, the issues presented are very real, and the people who wrote the case have the knowledge to piece these issues together," explained Brownlee.
In the case study, TBL Technology Considers Sustainability Reporting, students are presented an overview of corporate social responsibility reporting and then led through the fictional company's cost-benefit analysis.
The case illustrates the complexity of deciding whether or not to report on a company's sustainability performance from the perspectives of the CEO, CSO, CFO, and Audit Committee Chair. Readers follow each executive's assessment of the potential impact of reporting on "triple bottom line" performance, stakeholder trust and expectations, risk management, competitive advantage, and operational efficiency. "I like the fact that they looked at the case from so many different perspectives," Brownlee said. "It allows students to consider what information they should release and who they should involve in the process."
The case study discussion questions also guide students and professors through the issues that arise in the case, such as:
- The challenge of defining the costs and benefits of sustainability reporting.
- The roles and necessary actions of key company decision-makers.
- How sustainability fits into the greater issue of enhancing business performance.
"One fundamental issue of sustainability reporting is that you may expose parts of the business that some constituencies might not have thought about. It is a question of exposing and sharing what could be sensitive information," Brownlee said. "Greater transparency can have positive and negative impacts, and the case study allows students to think of all the consequences."
Ultimately, however, that transparency and the way businesses integrate sustainability are going to be "part of the DNA of companies going forward," Brownlee said. "It is a privilege to do business, and businesses have a responsibility to report on all the dimensions of how they do business. Our external constituencies now expect it. Using this case study, which represents timely, relevant, and real topics, to teach students is a logical progression of that."