STANFORD GRADUATE SCHOOL OF BUSINESS—Economic activity that ignores environmental impacts is occurring on such a massive scale in the developed world today that we face dire consequences, said William Barnett, faculty director of Business Strategies for Environmental Sustainability, a new Stanford Executive Education program offered in fall 2007.

Speaking at a sold-out session to introduce the new executive program, Barnett said environmental sustainability is the result of joint concerted efforts by business, non-governmental organizations, and government and regulatory agencies,

"The concern here is not whether or not what we're doing is inherently good or sustainable or complementary to the world around us," said Barnett, the Thomas M. Siebel Professor of Business Leadership, Strategy, and Organizations at the Stanford Graduate School of Business; and Senior Fellow in the Woods Institute for the Environment at Stanford. The concern is whether or not our actions are "mindless." Sustainable business practices must be based on "rational activity that includes not only a profit motive but also concerns for the environmental impact of what we do."

The new executive program Business Strategies for Environmental Sustainability is a multidisciplinary approach to training future leaders to think—and act—rationally about the ways human activity impacts the environment.

Business leaders must move beyond merely complying with regulations and view environmental awareness as a basic requirement for management, just as they now view finance, accounting, or marketing. Moreover, they should acknowledge that environmentally sustainable business practices are often costly. Not all attempts to change business practices to be more environmentally friendly—the popular "it pays to be green" view—lead to increased profitability. "We have to explicitly manage the difficult tradeoffs that are involved when business goals and environmental goals come into conflict as they often do," he said.

Environmental organizations have long been the visionaries urging citizens to be concerned about sustainability. While their commitment to their cause has not necessarily changed, their methods have. Barnett cited research showing a pragmatic shift by environmental groups toward working in cooperation with, rather than in opposition to, business to find solutions to environmental problems. He and one of his doctoral students are studying the past decade's goals and tactics by environmental groups to identify trends.

Leaders in these environmental organizations face the difficult question: When do you oppose and when do you work with business? "If you work with [business], and it turns out you're not effective, then you can be accused of "greenwashing" the organization that you're working with. An essential part of this executive program's curriculum is to talk about activists' strategies for working in the so-called non-market or governmental side of business," he said.

Leadership from government, the third side of the triangle, goes beyond regulation. "Think about policy as a set of constraints and encouragements that give birth to markets," said Barnett, "about harnessing markets to solve environmental problems." For example, he said, when one sees a hybrid vehicle, one usually thinks about the political views of the owner, that the driver has made a personal choice. Alternatively, "Every time I see a Prius I think about the parts manufacturers," he said. "The idea is to think about environmental solutions as a source of new markets so political leadership can set the right context for such activities, essentially helping push economic activity in the direction of more sustainable solutions." And this must be understood as a global phenomenon, he said.

"This is about creating systems that guide human activity in the direction of more sustainable solutions."

Related Information

Business Strategies for Environmental Sustainability Program

Designed for senior executives and officers across a wide array of organizations in the private, public, and nonprofit sectors, the curriculum for the Business Strategies for Environmental Sustainability executive program will include sessions on green vs. greenwashing, environmental sustainability and the supply chain, and high-profile activism: media and boycotts. Offered September 16-22, 2007, the program will be held at Fallen Leaf Lake near Lake Tahoe at the Stanford Sierra Conference Center.

For more details, including application deadline and tuition, visit: www.gsb.stanford.edu/exed/bses.