For some students graduating from the Ted Rogers School of Management at Ryerson University in Toronto this year, their graduation ceremony will involve more than walking across the convocation stage.
A group of newly minted graduates will take a solemn pledge: "As a business leader, I recognize my role in society," the pledge begins, before detailing a laundry list of principles they promise will guide their decisions in their work – from supporting human rights and sustainability to rejecting corruption and "business practices harmful to society."
According to fourth-year commerce student Saba Samanianpour, who was part of the student club dedicated to corporate social responsibility (CSR) that initiated the pledge, this move represents a fundamental shift among business students.
No longer do these students see "doing good" as an aside, merely philanthropic or marketing work of a corporate citizen whose primary objective remains to maximize profit; increasingly, they look to business schools for effective tools to make positive change.
"Business students these days don't want to enter the business world and work for a company that doesn't align with their values," explains Ryerson professor Kernaghan Webb.
Earlier this fall, some 1,200 young people from about 190 countries, including Canada, gathered in Dublin to develop business skills and networks to further their social and environmental goals. The four-year-old One Young World summit is billed to corporations and universities as the leading CSR professional development opportunity for young people. (Ottawa recently won the bid to play host to the summit in 2016.)
"We believe that business can be a big part of the solution to the world's biggest challenges," says David Jones, former chief executive officer of French PR company Havas and co-founder of One Young World. "In the last century, business has had great execution but not always great intentions. Charity has good intentions, but not always great execution."
Serial entrepreneur Doug Richard, the founder of School for Startups in Britain who addressed the One Young World summit, says that "purpose-led" businesses are on the rise. "It's becoming more common to say, 'I'm starting this business because I want to do some good in the world,'" Mr. Richard says in an interview. "That can be your motivating purpose but it cannot be your motivating activity because your activity must be to run a very successful business. You have to do well [financially] to do good."
This tension between profit and social impact has led business schools to create new offerings to help purpose-driven entrepreneurs develop sustainable businesses. The Beedie School of Business at Simon Fraser University in Vancouver, for example, launched the new Radius Social Innovation Lab and Venture Incubator about a year ago to respond to this need. "When I was an undergrad at SFU and doing my MBA at Oxford, it was still rare to find support in starting a business that aligned with your values," Radius director Shawn Smith says.
Radius functions as an incubator for this breed of startup, but the school is also working on other ways to work social innovation into its curriculum. "We don't want to build a social entrepreneurship ghetto where everyone talks about doing good while the real business happens elsewhere," explains Prof. Smith. "This should be the future of the economy, not the odd case where an ex-business student tries to create something good."
Hans Reitz, who also addressed the One Young World summit, argues that social entrepreneurship is closer to what business was initially intended for. Mr. Reitz, who with Nobel laureate Muhammad Yunus co-founded the Grameen Creative Lab to support social businesses, says that business was originally about combining different people's skills to tackle natural challenges. In sixth-century Europe, the Old English bisignes (businesses) referred to dividing different winter preparations among villagers to maximize the efficiency of individuals' skills. "I think that's the real meaning of business. There are natural challenges all over the world, and we try to put our efforts together to overcome them," Mr. Reitz says.
Mr. Richard says that education ought to help entrepreneurs figure out how to generate profit while tackling a social problem. Take, for example, the London-based Food for Good, which Mr. Richard helped kick-start at the School for Startups. Food for Good was founded to address the problem of food waste. The company bought fresh produce from wholesale vegetable markets that would otherwise be thrown out. But in order for the business model to work, it needed to add value. So the company processes the vegetables and sells them to restaurants which save by cutting back on prep labour. "They're making a high marginal profit and they're reducing food waste."
Editor's note: This version of the article says young people from about 190 countries attended the One Young World summit. A previous version said it was 160.