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Faculty
Kai Hockerts, CBS

Course Coordinator
ISUP Secretariat

Prerequisite/progression of the course

Basic knowledge of business policy and strategic management are advantageous.

Course content, structure and teaching

This elective helps participants to identify the competitive opportunities of sustainable development and corporate social responsibility (CSR). Over the past decade public concern about social and environmental issues has profoundly transformed the competitive field. Yet, rather than uniformly changing the market conditions for all participants, sustainable development impacts companies differently. This translates into both opportunities and risks for individual firms. Sustainability strategies are thus used by a growing number of businesses to differentiate themselves from their competitors and to obtain firm-specific advantages. Managers adopt environmental and CSR strategies to reduce operational risks or to obtain cost advantages over their competitors. At the same time they leverage product innovation to obtain premium prices in their home markets and to expand into entirely new segments. In the face of increasingly innovative legislation and consistent pressure from NGOs, sustainability is today becoming a core management issues. Unchecked social and environmental costs can quickly eat into profit margins and constantly changing stakeholder demands make sustainability a key challenge for corporate change management.

The course's development of personal competences

The class helps participants understand, evaluate, and systematically manage sustainability issues. It will start by outlining the principal mechanisms through which environmental and social issues transform the competitive field of businesses, as well as the basic strategic options managers have to manage these changes. The class will then discuss four ways through which firms can achieve competitive advantages: by reducing operating costs; by managing social risks, by obtaining premium prices for innovative products; any by entering new markets through social innovation. The next part of the course analyses selected drivers for the social transformation of competitive landscapes. It will highlight drivers of sustainability such as regulation, public pressure groups, as well as investor concern.

Learning Objectives

At the end of the course students should be able to

• Define which environmental and social factors impact a firm’s business strategies.
• Explain how these variables link to a firm’s profitable growth.
• Specify the strengths and weaknesses of alternative theoretical frameworks explaining the distinctive challenges that managing corporate sustainability poses.
• Apply these theories to the analysis of real-world case studies of corporate sustainability.

Teaching methods

The class is based on active class participation. Teaching will draw on case studies that will have to be prepared in advance of each class. Supplementary readings will be available to illustrate theory. Short oral and written assignments will be given in order to prepare some of the cases.

Examination

Final exam: Project/home assignment (written individually), 15 A4 pages.

Re-take exam: Project/home assignment (written individually), 15 A4 pages.

Recommended literature

• Porter, Michael E. and Claas van der Linde. 1995. Green and competitive: Ending the stalemate. In Harvard Business Review, 73(5): p120-134.
• O'Neill Packard, Kimberly and Forest L. Reinhardt. 2000. What Every Executive Needs to Know About Global Warming. In Harvard Business Review, 78(4): 129-135.
• Dyllick, T., & Hockerts, K. N. 2002. Beyond the Business Case for Corporate Sustainability. Business Strategy and the Environment, 11(2): 130-141.
• Vogel, D. 2003. The Hare and the Tortoise Revisited: The New Politics of Consumer and Environmental Regulation in Europe. British Journal of Political Science, 33: 557-580.
• Spar, Debora L. and Lane T. La Mure. The Power of Activism: Assessing the Impact of NGOs on Global Business. In California Management Review, 45(3): 78-102.
• Knoepfel, Ivo. 2001. Dow Jones Sustainability Group Index: A Global Benchmark for Corporate Sustainability. In Corporate Environmental Strategy, 8(1): 6-15.
• Walley, N. and B. Whitehead. 1994. Its not easy being green. In Harvard Business Review, 72(3): 46-52.
• Bennett, Martin and Peter James. 1998. Making Environmental Management Count, Baxter International's Environmental Financial Statement. In The Green Bottom Line: M Bennett, P James (Eds.): 294-309. Greenleaf Publishing: Sheffield.

Last updated by ISUP Secretariat 28/01/2010