Social Innovation At Stanford’s GSB

What is the difference between the classes that are run through the CSI and other business classes? 

One question we ask ourselves is: Why can’t people just take regular classes in management, why does there have to be classes specifically tailored to social innovation? For example, if you look at the subject of social investing, say, if a pension fund is investing in a social innovation fund, there are important reasons why you should have different classes, not only in terms of business ethics, but there are actual investors’ and managers’ fiduciary responsibilities. If you were to have a regular investment class on portfolio management, that class is not going to be relevant, because the goal is to maximize the returns for your investors given the risk tolerance the returns they want. In the case of investing in a social impact fund, you’re matching the risk and return, but in addition to the risk and return management there’s a social component. The combination of those measures along with a social component requires a different way of thinking, and that requires a separate class.

How many students get involved with the CSI?

In terms of touch points it’s a very large percentage of the class. For MBAs in FY15, 92% of students have been touched in some way by CSI (took one class or attended one event), 26% earned a Certificate in Public Management and Social Innovation, and 46% participated in a CSI experience.

Tell us about some of the specific courses that are housed in the CSI?

There are four courses that we consider core to a social innovation experience in the curriculum. Strategic Management of Nonprofit Organizations and Social Ventures, Taking Social Innovation to Scale, Strategic Philanthropy and Foundations of Impact Investing. Strategic Management of Non-Profit Ventures is a corporate strategy class specifically geared toward managing a non-profit organization, which is very different from managing a for-profit organization. The class is now taught by Bill Meehan, director emeritus of McKinsey & Co., and has also been taught by Paul Brest, former dean of the Stanford Law School. The class on scaling social enterprises is taught by a lecturer, Steve Davis, CEO of PATH, the leader in global health innovation, and former global Director of Social Innovation at McKinsey–we believe that’s pretty core. There’s a third class on philanthropy and a fourth class on impact investing.

Impact investing is a really interesting space. A lot of our students are experienced on the finance side, and think that’s how they can make a big impact. Impact investing funds are tricky–you have to balance the fiduciary obligation to both society and investors. This brings up a bigger question: What does impact investing actually mean? Charles Ewald teaches the class, and we’d like to get more of our tenure-lined finance faculty in to provide a little more of the theory side of this subject.

These are the four classes that we make sure are being offered every year. Other classes we view as more elective classes or domain specific, which we try to offer every year for students, but if they aren’t one year it’s not the end of the world because you have two years in an MBA program.

What other courses have been popular?

One big thing we are seeing with the Stanford MBA program is an increasing number of dual-degree students who are getting a master’s degree in other fields. Some of the classes that have been very popular are classes on innovations to education. These courses are popular not only because they can satisfy requirements for a dual degree with the School of Education, but because education is a space which has performed poorly for a lot of kids in America in the last several years. It’s a space which is antiquated and open for disruption; there are a few classes, some taught by Ed School faculty like Suzanna Loeb, and some taught by lecturers on market solutions to educational challenges.

Social innovation has been part of the Stanford GSB philosophy since even before the center was founded in 2000. What’s in Stanford’s water that makes it different?

Stanford’s social focus goes back well before the founding of the Center for Social Innovation; I think it starts with the public management program and Arjay Miller. Stanford is the first business school to really view stakeholders outside of the firm as very important to how business people should be thinking as managers. This focus was closely related to Miller’s executive experience at Ford. He ran that company during a time when safety activist groups were threatening Ford, and Ford realized they couldn’t just make great cars for American consumers and they couldn’t just have a good town in Michigan for their employees. A bunch of complicated issues raised by activists and political forces converged, and companies had to proactively manage these forces.

We were the first school to offer a Certificate in Public Management as a core part of the business curriculum in 1971. This is a key differentiator of our brand compared to a competitor like Harvard Business School. If you look at what Harvard is doing, they’re trying to do a lot of the same stuff that we have been doing because they know it is important and the students want it.