Business Schools Can Shape a Sustainable Future

• Forward-thinking business programs are embedding sustainable and circular business principles in their curricula, operations, culture, and partnerships.
• Instead of training leaders to view success through a narrow profit lens, more schools are preparing them to design regenerative, future-proof organizations.
• By embracing the circular economy, schools can graduate leaders who will redefine success in ways that benefit business and society.

 
In a typical linear economy, businesses utilize resources to produce goods that people ultimately discard. But in a circular economy, businesses design products and services to be long-lasting, reused, remade, and recycled from the outset. A circular economy is a closed-loop system where resources don’t sit around and gather dust and where they aren’t expended to generate short-term profits. Rather, they are used wisely over time through systems of reuse, repair, and responsible recycling to maximize long-term value. 

The circular model brings the planet’s ecology and economy together in ways that benefit both. It’s not surprising, then, that businesses worldwide are increasingly adopting circular ideas in response to new business opportunities, changing regulations, and increasing customer demand.

But such models require business leaders to rethink the fundamental principles that underpin their strategies. They need to answer new questions: How can we make money by providing a service instead of selling a product? How can we build supply chains that make it easy to reuse materials?

AACSB often underscores the need for contemporary leaders to understand and apply innovative business models that balance financial, environmental, and social considerations. In other words, business schools must be a critical part of ensuring that future leaders have the knowledge and skills to make money while solving social and environmental problems.

Supporting a Sustainable Transition

To understand how to transition to a circular economy, students need to learn how to put sustainable practices into action. Once students enter the workplace, they need to help companies rethink their business structures and redefine what “value” truly means. Fortunately, business schools already have the elements in place to teach students new ways of thinking about business problems:

• Business schools primarily teach people to think critically and view things from a systemic perspective, which is essential for circular innovation.
• Programs that foster interdisciplinary collaboration are preparing students to work with engineers, legislators, and designers to overcome obstacles and participate in sustainable initiatives.
• Many schools also emphasize experiential learning in which students address real-world problems for actual businesses. Their programs develop individuals who can generate new ideas spontaneously, make informed trade-offs, and understand and apply principles such as cradle-to-cradle design and systems thinking.

For help implementing ideas specific to the circular economy, business leaders and business school faculty alike have many external resources at their disposal. For instance, schools can align their curricula with the United Nations Sustainable Development Goals.

Additionally, they can incorporate content provided by the Ellen MacArthur Foundation, and teach the strategies proposed in the European Union’s Circular Economy Action Plan. We need to use every tool available to address the leadership, marketing, financial, and logistical aspects of transitioning from linear to circular processes.

Addressing Sustainability in All Subjects

To support this transition, our programs should not treat sustainability as a separate subject, but integrate it across the business curriculum. That’s our approach at the Birla Institute of Management Technology (BIMTECH) in Greater Noida, India, where circular models inform every business subject. For example:

• Students in a marketing course study product-as-a-service models. For instance, they are introduced to case studies such as one involving lighting company Philips, which delivers “lighting-as-a-service” (what it calls “pay-per-lux”).
• Students in a finance course calculate the return on investment of circular business models, consider risk factors related to regulatory changes in waste management, and evaluate how sustainable investments impact long-term profitability.
• Students in a human resources course examine how Unilever’s brands are sourcing raw materials and reducing carbon emissions and how clothing company Patagonia incorporates sustainability into its hiring, training, and culture.

In addition, BIMTECH hosts the Atal Incubation Centre (AIC-BIMTECH), which provides students with guidance and financial support to develop startup ideas that support the circular economy. AIC-BIMTECH also enables other students to intern with and receive mentorship from these ventures as they develop their own circular economy solutions.

We need to use every tool available to address the leadership, marketing, financial, and logistical aspects of transitioning from linear to circular processes.

Several companies have emerged from this startup culture, addressing problems such as waste management, renewable resources, or services in the sharing economy. One notable example is UNEAKO, which offers innovative, eco-friendly alternatives to single-use plastics and now operates as a registered enterprise with an active online presence.

The school incorporates such green business ideas into the classroom, sending a strong message that “doing good” and being successful go hand in hand.

Going Further: The KODECET Project

BIMTECH’s approach is part of a broader global movement to embed circular principles in management education. In January 2024, the school joined with universities in India, Finland, Austria, and Thailand to form the Knowledge Development for Circular Economy Transition (KODECET) alliance. Funded by the European Union, the three-year project focuses on providing educational resources and courses dedicated to integrating Sustainable and Circular Economy, or SACE, principles into higher education.

KODECET course content, encompassing a variety of perspectives and cultures, is now being used across business schools in Europe and Asia. A major part of the initiative is Digi-SUSTEACH, a project in which four partner institutions have opened teaching centers that provide courses and open-source materials to faculty. Professors at partner institutions also can collaborate to teach classes and give students different perspectives through faculty exchange programs.

BIMTECH has assembled an internal project team to assist KODECET in achieving its goals. Additionally, in 2024, our school became India’s national KODECET lead and opened its own Digi-SUSTEACH center—one of the country’s first digital centers of excellence to focus on circular economy education. Business leaders have joined the center’s advisory board to ensure that the curriculum remains up to date and incorporates real-world skills.

Prabina Rajib, BIMTECH’s director, describes the KODECET project as an effort to cultivate “environmentally conscious leaders who will instigate systemic change” and as “a transformative leap toward reimagining management education for a sustainable future.”

Sharing Knowledge: One Size Does Not Fit All

KODECET’s mission recognizes a clear reality: As the circular economy movement grows more popular, the gap in adoption between affluent and developing countries will only increase. Alliance partners are working to close that gap by combining European knowledge of technology and teaching methods with Asian perspectives on rapidly expanding but often resource-constrained economies.

Business schools in wealthy nations—which often have well-established recycling systems, strict environmental regulations, and public awareness of sustainability—are likely to help organizations review their plans for circular projects. In this context, instead of training students to assess performance through traditional metrics such as quarterly earnings, business schools teach them to use long-term impact metrics such as material circularity, carbon footprint reduction, and community benefits. At European schools, KODECET content is used in MBA electives that concentrate on sustainable finance and supply chain analytics. 

In contrast, business schools in developing nations, where infrastructure and government aid are often lacking, are more likely to be focused on influencing governmental policy and developing practical solutions tailored to local needs. These schools work to narrow the policy-action divide by producing structured, cyclical models (such as informal recycling and waste management systems) that combine local experience with circular economy principles.

At schools in South and Southeast Asia, KODECET courses deal with local problems. For example, in New Delhi, business schools are developing frameworks to integrate informal recycling businesses into the official economy, generating long-term business models for resource recovery and sustainability.

The KODECET alliance provides a two-way benefit. Asian schools work with their European partners to gain technical expertise and learn about proven curriculum approaches. Meanwhile, European schools learn from their Asian partners how to implement techniques that fit local infrastructural and societal needs.

Bringing Education and Business Together

To ensure that their efforts have a tangible impact, progressive business schools are strengthening their ties with businesses and other organizations. They are fostering two-way relationships where organizations are exposed to new ideas and research-based practices and students acquire hands-on experience and practical skills.

Students might collaborate with a local business to develop a circular supply chain to reduce waste. Business schools might host conferences or seminars where academics and business leaders contribute ideas and collaborate on best practices and where students see how class concepts relate to real-world scenarios, locally and globally. 

Creating opportunities for CEOs, policymakers, and business leaders to communicate with each other about the circular economy facilitates broad-based circular transformation.

BIMTECH has hosted several small industry-focused events, such as breakfast meetings, and plans to launch a Management Development Program focused on closed-loop business strategies. Next year, BIMTECH will organize its first circular economy conference as part of the KODECET program.

Creating opportunities for CEOs, policymakers, and business leaders to communicate with each other and to contribute to the curriculum makes learning more interesting. Moreover, it positions schools as champions for sustainability and facilitates broad-based circular transformation.

Teaching for a Circular Future

A business school’s culture and leadership have a substantial impact on how effectively it can integrate sustainability into its goals. When deans and directors prioritize the circular economy, they send a clear message of their commitment through how they work with businesses and set research goals. With their explicit support, their schools open specialized centers, train faculty, form partnerships, and foster campus atmospheres where people naturally desire to work toward achieving sustainability and circular economy goals.

There is an implied moral aspect to KODECET and similar initiatives, in both developed and developing contexts. As governments work to adopt sustainable policies and practices, corporations need new hires who can understand and follow rules regarding environmental protections and the responsible use of resources. They need leaders who are flexible, who can collaborate with stakeholders, and who can combine the company’s strategy with circular concepts.

By incorporating circularity into their regular curricula, business schools will uphold their responsibility to produce leaders who can apply circular solutions that suit diverse cultures and build businesses that endure, generate revenue, and benefit society. By embracing the circular economy, business schools will fulfill their social responsibility to support sustainable business practices and achieve positive impact.