Societal Impact at the Core of Business School Strategy

• Since AACSB incorporated societal impact into its 2020 accreditation standards, it has become a key strategic priority of business schools around the world.
• Schools such as UCI Merage and Houston Bauer are demonstrating how school-led initiatives can benefit local communities and beyond.
• Business school deans believe that the next phase of social impact must move from intention and activity to measurable, lasting impact.

 
It’s probably fair to say that social impact has not always been a priority of business schools. While it’s difficult to identify a specific turning point in attitudes, some suggest that the 2008 financial crisis may have been one.

“After that, a lot of the sensemaking put business education as one of the reasons why we had that financial crisis,” explains Ian Williamson, dean of the University of California, Irvine’s Paul Merage School of Business. He notes that a business education gave students the skills to “create the types of financial instruments that were one of the triggers for the crisis,” and the crisis also challenged us to question the role of business in society. “That was a fair criticism.”

But today, things look very different. Social impact is now a key strategic priority of business schools around the world. They recognize that producing leaders who create a positive impact in the world is no longer a nice-to-have. It’s a real, achievable goal that can bring significant value to the school and wider community.

This viewpoint has become more mainstream since AACSB incorporated societal impact into its 2020 accreditation standards (since updated to the Global Standards for Business Education™). That change transformed the definition of quality business education and marked a fundamental shift in how schools defined their purpose and success.

Schools are now putting social impact at the forefront of their strategies, developing projects and targets that deliver a long-term, measurable, positive impact to the communities they serve.

The Future Leaders Initiative at UCI Merage School of Business

One of those projects is the Merage School of Business’ Future Leaders Initiative (FLI), which was recently recognized in AACSB’s Global Impact Awards.

The idea originated from conversations Williamson had with local business leaders. He discovered that it was getting harder and harder for them to find talent in the local area. And if they couldn’t find the talent they needed, the firms suggested they would have to recruit from afar or leave the area altogether.

At the same time, conversations with Orange County high school principals revealed that students simply weren’t aware that this skills shortage existed—or how they could fill it. In many of those communities, higher education also just seemed out of reach to them. Williamson set about to change that.

“What was really obvious was how students from underrepresented backgrounds were not taking classes in high school that were preparing them for careers in these technology spaces,” he recalls. “So we had this market failure. I had this talent that wasn't aware of these opportunities, and I had opportunities that weren't focused on the talent we had.”

In many [underrepresented] communities, higher education also just seemed out of reach to [high school students].

From there, the initiative was born. It includes on-campus immersion at UC Irvine, delivery of business education and financial literacy curriculum to high school students, and career-coaching workshops. FLI even offers executive mentorship from Fortune 100 and venture leaders, giving students long-term guidance and pathways into internships, shadowing, and paid opportunities.

Five years ago, 40 students signed up for the program. This year, 175 were admitted from a total of 800 applications. The initiative has also measurably increased trust between UC Irvine and historically disconnected communities. But Williamson still believes UCI Merage and the wider business education community could—and perhaps should—be doing more.

“It really speaks to this notion of how universities create value for their societies. Our university has a goal of being an engine of mobility for members of our community. I think this represents somewhat untapped potential for universities if they also set their goal of being agents of change in their community.”

“I think that's very important, but I don't think every university views that as their goal.”

SURE℠ Program at Bauer College of Business

While the Future Leaders Initiative was borne out of community conversations, the SURE (Stimulating Urban Renewal through Entrepreneurship) program at the University of Houston’s C.T. Bauer College of Business was stimulated by students.

Saleha Khumawala, the program’s founding director, explains how an MBA student approached her to ask how he could develop a skill set that would set him apart from his cohort. Khumawala recommended the SURE program—still in its infancy at that point—and from there, sign-ups grew and grew.

“The SURE program creates a unique ecosystem by partnering students with local entrepreneurs and executives from the business community,” she explains. “They all come to campus every week, and students serve as consultants to these entrepreneurs.”

Each student who signs up for the three-credit-hour course is assigned to work with three different entrepreneurs from the local business community. By the end of the semester, entrepreneurs will have developed a ready-to-pitch business plan. Besides the support from Bauer students, they also benefit from free lectures given by local executives on topics such as marketing, corporate law, and finance.

The SURE program is free for entrepreneurs to join, removing the financial barrier that most prospective students cite as the biggest one to pursuing a business education. It admits 125–130 entrepreneurs each semester, with around 200 of them graduating.

Each student who signs up for the three-credit-hour course is assigned to work with three different entrepreneurs from the local business community.

Although the impacts of the program can be measured in numbers—entrepreneurs have created around 3,300 jobs since the launch of the program—Khumawala argues that the qualitative benefits are perhaps even greater.

“As an entrepreneur, it builds your self-esteem. Universities have always been ivy-walled, where not anybody can come in and take a course. Now, we’re opening access to the underresourced who can come to campus and take the same course that business students are taking. That alone brings so much confidence and self-esteem.”

Initiatives like this may not have existed at business schools in previous years. It’s an example of how student demand can also drive a change in attitude within “ivy-walled” institutions.

“Gen Z are so focused on societal problems,” Khumawala says. “So you’re giving them what they want and meeting their passions.”

The Future of Social Impact at Business Schools

Plenty of progress has been made at business schools over the last five years in particular—something that was highlighted in AACSB’s recent Five Years of Societal Impact report. It found that all over the world, business schools like these are having a measurable impact on the economy, the environment, and people.

According to the report, since 2020, more than 1,000 AACSB-accredited schools have contributed to almost 12,000 social impact initiatives. Ninety-five percent of AACSB-accredited schools now include social impact within their mission, while 99.9 percent integrate it across their core activities. It is now unquestionably a central component of business school strategy.

That said, challenges remain. Schools quoted in the report cited limited outcome-level evidence, fragmented measurement approaches, and inconsistent definitions of impact as some of the key barriers holding back progress. The viewpoint is shared among business school deans.

Ninety-five percent of AACSB-accredited schools now include social impact within their mission.

“We know there is more work to do,” says Lerzan Aksoy, dean of Fordham University’s Gabelli School of Business. “The next phase must accelerate the transition from intention to action, and from activity to measurable, lasting impact.”

According to Aksoy, success in social impact will be measured by “the development of leaders who come from diverse backgrounds but who share the same desire to use their positions of influence to create positive change in the world.” As such, she hopes their experiences at schools such as Gabelli will help shape that change.

Williamson believes it’s important to remember that ultimately, universities “have a responsibility” to benefit society through their actions. And he believes in the power of business education to make it happen.

“Business education has never been more useful for individuals, so our value is there,” he says. “But I don't think we should ever take it for granted.”