When some US firms move production overseas, they also offshore their pollution

THE CONVERSATION – May 18, 2017
by Yue Maggie Zhou

On April 22, as protesters swelled Earth Day rallies in U.S. cities and around the world, President Trump tweeted that he was “committed to keeping our air and water clean but always remember that economic growth enhances environmental protection. Jobs matter!” His message was eerily similar to assertions by governments in developing countries that environmental standards are less important than attracting jobs.

Indeed, over the last few decades many developing countries have adopted loose environmental standards to lure foreign firms to move production there. However, an emerging body of research shows that policies like this also bring heavy pollution to the host countries.

In a recent study, my co-author Xiaoyang Li and I found that a significant number of U.S. firms reduce their pollution at home by offshoring production to poor and less regulated countries. The greening of U.S. manufacturing over the past several decades may be partially caused by a growing flow of “brown” imports from poor countries.

Cleaner at home, dirty abroad

A “jobs-first” policy can add to serious environmental challenges in the host country. For example, one recent study calculates that 17 to 36 percent of four major air pollutants emitted in China come from production for export. Among these export-related emissions, about 21 percent come from the production of goods for the United States.

Studies like this suggest that trade can potentially redistribute environmental footprints. This can happen via two pathways. One is for “dirty” firms in rich countries to stay out of the entire value chain that contains the polluting activities. In this case, some rich country customers will stop consuming the “dirty” products, which is good for the global environment. Others will keep consuming “dirty” products imported from poor and less regulated countries.

Another way is for firms in rich countries to keep selling the “dirty” products but redesign their production networks. They will offshore production (and jobs) in the “dirty” segment of the value chain to poor countries. They will then import the “dirty” unfinished products from poor countries for further domestic processing in the clean segment of the value chain.

Unfortunately, existing studies have not been able to tease apart these two pathways. To find out if some U.S. companies were taking the second route, we obtained data from the U.S. Census Bureau and the Environmental Protection Agency about trade, production and pollution for more than 8,000 U.S. firms with 18,000 U.S. plants.

In this May 1973 view of the Pittsburgh, Pennsylvania skyline, steel plants line both sides of the Monongahela River. John Alexandrowicz, NARA/Wikipedia

We first found that of all goods imported by U.S. manufacturing firms (not wholesaler or retailers), the share produced in low-wage countries rose from 7 percent in 1992 to 23 percent in 2009. At the same time, toxic air emissions from manufacturing industries in the United States fell by more than half. Industries that experienced the greatest increase in imports from low-wage countries include printing, apparel and textile, furniture, and rubber and plastics. These industries also experienced some of the largest drops in air pollution in the United States.

Second, using this unprecedentedly detailed data, we obtained some interesting findings at the firm and plant level. We found that as U.S. firms imported more goods from low-wage countries, their plants released fewer toxic emissions on American soil. In addition, their U.S. plants shifted production to less-polluting industries, produced less waste, and spent less on pollution abatement. In sum, these firms were improving their own environmental performance by shifting to less-polluting segment of the value chain domestically and moving more-polluting activities overseas.

To our relief, we found that not all U.S. firms chose to offshore their pollution. In particular, firms that are more productive and invest more in R&D and brand equity offshore less pollution. These firms may find it less costly to renovate production technology domestically to comply with stringent environmental standards. They may also find it more rewarding to do so because consumers become more loyal to their brand for their socially responsible behavior at home.

Changing firms’ incentives

U.S. companies that offshore pollution are not violating environmental laws either at home or in their host countries. Indeed, rebalancing their global production is a logical response to higher environmental compliance costs in the United States.

However, to the extent that U.S. firms can choose either to purchase cheap and “dirty-to-make” goods from low-wage countries or to produce them under stringent environmental standards at home, they are making a strategic decision about the private costs of production compared to the public (and international) costs of pollution. Companies that offshore pollution to less-regulated countries are taking advantage of those nations’ lower environmental and labor standards and letting the host countries bear the associated social costs.

A Bangladeshi worker throws a washed rawhide onto a pile inside a factory at the highly polluted Hazaribagh tannery area on the banks of the River Buriganga in Dhaka, Bangladesh, Aug. 26, 2014. Bangladesh annually exports millions of dollars of leather goods to some 70 countries, including the U.S. and Japan. AP Photo/A.M. Ahad

Unfortunately, it is not always easy to induce companies to adopt higher standards for their operations in developing countries. After Nike was first reported to have unsafe and abusive working conditions at its foreign plants, it took the company almost a decade to announce that it would raise wages, increase monitoring and adopt more stringent air quality standards in its factories overseas.

Similarly, Foxconn – a key supplier to Apple – has incurred heavy criticism over its labor practices in China. The company reportedly has improved its working conditions there, but it has also diversified into other low-wage nations where regulations are more lax, including Malaysia, Mexico, Brazil, Vietnam and Indonesia.

Reward social responsibility

In a global market where companies compete fiercely across national boundaries, governments should coordinate closely to maintain a regulatory framework that incentivizes firms to undertake more socially responsible actions. Participating in trade agreements with strong environmental requirements, and in global coalitions such as those proposed at the United Nations Climate Change Conferences, is one way to coordinate. Unfortunately, some of the world’s largest economies seem to be stepping in the opposite direction.

Jobs are important for both developed and developing countries. In the face of globalization, however, national leaders should focus more on jobs that are sustainable and do not come at the expense of the environment.

Society’s biggest problems need more than a nudge

THE CONVERSATION – May 15, 2016
by Joe Arvai

So-called “nudge units” are popping up in governments all around the world.

The best-known examples include the U.K.’s Behavioural Insights Team, created in 2010, and the White House-based Social and Behavioral Sciences Team, introduced by the Obama administration in 2014. Their mission is to leverage findings from behavioral science so that people’s decisions can be nudged in the direction of their best intentions without curtailing their ability to make choices that don’t align with their priorities.

Overall, these – and other – governments have made important strides when it comes to using behavioral science to nudge their constituents into better choices.

Yet, the same governments have done little to improve their own decision-making processes. Consider big missteps like the Flint water crisis. How could officials in Michigan decide to place an essential service – safe water – and almost 100,000 people at risk in order to save US$100 per day for three months? No defensible decision-making process should have allowed this call to be made.

When it comes to many of the big decisions faced by governments – and the private sector – behavioral science has more to offer than simple nudges.

Behavioral scientists who study decision-making processes could also help policy-makers understand why things went wrong in Flint, and how to get their arms around a wide array of society’s biggest problems – from energy transitions to how to best approach the refugee crisis in Syria.

When nudges are enough

The idea of nudging people in the direction of decisions that are in their own best interest has been around for a while. But it was popularized in 2008 with the publication of the bestseller “Nudge” by Richard Thaler of the University of Chicago and Cass Sunstein of Harvard.

A common nudge goes something like this: if we want to eat better but are having a hard time doing it, choice architects can reengineer the environment in which we make our food choices so that healthier options are intuitively easier to select, without making it unrealistically difficult to eat junk food if that’s what we’d rather do. So, for example, we can shelve healthy foods at eye level in supermarkets, with less-healthy options relegated to the shelves nearer to the floor.

Likewise, if we want to encourage more people to be organ donors, choice architects can design the form we fill out at the DMV so that the choice we make without thinking is the one that may allow us to save someone’s life in the future.

In my own research group, we lump these kinds of interventions under the umbrella of passive decision support because they don’t require a lot of effort on the part of a decision-maker. Indeed, these approaches are about exploiting – not correcting – the judgmental biases that people bring with them to all manner of decisions, large and small.

Since the publication of “Nudge,” there has been a proliferation of interest in bringing choice architecture into the policy mainstream. Even institutions like the World Bank and the Organization of Economic Cooperation and Development are rolling out their own nudge units. And, you shouldn’t be surprised to learn that the private sector has jumped on the increasingly crowded bandwagon of for-profit nudging.

We’ve successfully tested nudges for water conservation and sustainable food choice. Others have applied nudges to an even broader range of contexts. There’s no denying that choice architecture can work like gangbusters, which explains the widespread interest.

Sometimes a nudge isn’t enough

Nudges work for a wide array of choices, from ones we face every day to those that we face infrequently. Likewise, nudges are particularly well-suited to decisions that are complex with lots of different alternatives to choose from. And, they are advocated in situations where the outcomes of our decisions are delayed far enough into the future that they feel uncertain or abstract. This describes many of the big decisions policy-makers face, so it makes sense to think the solution must be more nudge units.

But herein lies the rub. For every context where a nudge seems like a realistic option, there’s at least another context where the application of passive decision support would be either be impossible – or, worse, a mistake.

Take, for example, the question of energy transitions. These transitions are often characterized by the move from infrastructure based on fossil fuels to renewables to address all manner of risks, including those from climate change. These are decisions that society makes infrequently. They are complex. And, the outcomes – which are based on our ability to meet conflicting economic, social and environmental objectives – will be delayed.

But, absent regulation that would place severe restrictions on the kinds of options we could choose from – and which, incidentally, would violate the freedom-of-choice tenet of choice architecture – there’s no way to put renewable infrastructure options at proverbial eye level for state or federal decision-makers, or their stakeholders.

Simply put, a nudge for a decision like this would be impossible. In these cases, decisions have to be made the old-fashioned way: with a heavy lift instead of a nudge.

Often, decisions are more complex

Complex policy decisions like this require what we call active decision support.

In these cases, specialists trained in the science of decision-making must work with people both to help them to overcome predictable biases and to approach decisions in a way that is different from how they might otherwise make them instinctively. To inform and structure these kinds of decisions, we – like choice architects – also look to insights from the behavioral sciences.

For example, we have a rich understanding of the decision-making shortcuts that people apply, as well as of the predictable biases that accompany them. So, we know what to be on the lookout for when we help individuals and groups make better decisions.

When evaluating problems that unfold over long periods of time, we know that people tend not to look at cumulative effects, or consider how choices made today may restrict the choices that can be made in the future.

Likewise, we see that decision-makers struggle with questions about how to put boundaries around the problem before them. For example, who really counts as a legitimate stakeholder, and who doesn’t? Likewise, are there hard deadlines or financial ceilings that must be obeyed? Or are these really soft constraints that can be challenged if the right option can be identified?

We’ve also learned that decision-makers often fail to adequately account for the broad range of objectives that ought to guide their decisions, as well as the performance measures that let them know if they’ve achieved them. And, we know that the manner in which people search for alternatives is often incremental at best. People look to obvious and easy-to-find options, the tendency that nudges exploit, at the expense of the creativity that’s required to address the really complex challenges.

Perhaps worst of all, we observe that people avoid the necessary trade-offs when a choice can’t simultaneously achieve all of the objectives that they deem to be important. It’s often the case that the objectives that push emotional hot buttons, like fear, are the ones we pay the most attention to when trade-offs are difficult or uncomfortable, even if these objectives play a relatively small role in terms of advancing our overall well-being.

Active decision support helps decision-makers to overcome all of these obstacles, as well as others.

Unlike nudging, the intent of active decision support isn’t to direct people toward a specific course of action. It is to structure the decision-making process so that resulting choices are defensible – in other words, in line with our prioritized objectives. For big policies, this includes the deliberate balancing act between social, economic and environmental well-being.

The good news for policy-makers is that a wide range of tools and approaches are available which may help them make more defensible decisions.

Active decision support approaches work by breaking complex decisions into more cognitively manageable parts. And they are desperately needed. The wicked problems faced by society can’t be nudged away. Emergencies like the humanitarian crisis in Syria and the slow violence of climate change cry out for active decision support.

Yet, as governments amass nudge units, and as the private sector adopts a behavioral mindset in their marketing and public relations offices, the need for behavioral insights that support complex decisions goes unmet. Why? Perhaps because active decision support is often seen as something smart, educated people in the public and private sectors should be able to do intuitively, on their own. But, the simple truth is, they can’t. And, without investing in building the internal capacity for active decision support, they won’t.

How to vote for a president when you don’t like the candidates

THE CONVERSATION – September 29, 2016
by Aradhna Krishna and Tatiana Sokolova

How do voters select a candidate when no one they like is on the ballot?

Behavioral scientists have studied decision-making – including voting – for decades. However, researchers usually give respondents at least one appealing option to choose from.

This led us to wonder: What do voters do when they consider all of the options bad? Do they fall back on party affiliation, or simply toss a coin? This question is especially appropriate in the current presidential election because the two front runners have the lowest favorability ratings ever.

When we did research to answer this question, we learned that in situations where all of the choices are bad, people tend to vote by rejecting the choices they didn’t like, rather than by affirmatively choosing the one they disliked least.

Imagine there are two undesirable candidates named Tilly and Ron. Given this “two bad choices” option, voters will be more likely to select Tilly because they reject Ron, rather than select Tilly proactively.

While the end result may be the same, the thought process that leads to this decision is quite different.

As behavioral scientists who study how people make decisions, we think this distinction could affect the upcoming presidential election. If people select between Clinton and Trump by using rejection rather than choice, then the information they use to make their decisions will be different.

In some ways, it may be better. Voters using rejection are more deliberate. They are less likely to be swayed by unimportant information about a candidate that they read or hear on radio, television or Facebook. They may pay less attention to rumors. In fact, conscientious voters may be well served to actively adopt a rejection strategy for their vote in order to make a choice more deliberately.

Choosing to reject

In a study we ran online in April, we showed people only Hillary Clinton and Donald Trump as the two candidates for president. Those who found at least one of them attractive were more likely to select by choice, while those who disliked both were more likely to select by rejection.

Having determined that people use rejection strategies to make their voting decisions in bad-option situations, we next wanted to test how rejection strategies would change the information people focus on.

In nine separate studies we conducted, some of which will be published in an upcoming Journal of Consumer Research, we found that when people use rejection strategies, they also become more deliberate in their decision-making. In other words, they pay more attention to all information they have – both good and bad – and don’t get swayed as much by one piece of information that sticks out.

In our research, we saw more deliberation in rejection decisions and less of a tendency to be swayed by emotional, in-your-face information.

For example, one of these studies determined that people were less likely to vote based on party affiliation if they voted by rejection, rather than by choice. Respondents also took less time to make their decision in the choice condition versus the rejection condition.

Revisiting an old favorite

We reached these results by revisiting a classic study known as the “Asian disease problem.”

The Asian disease problem was first proposed by the behavioral economists Daniel Kahneman and Amos Tversky in 1981. It is well-studied because of the contradictory choices people make, and is one of the many conundrums that Kahneman proposed which later won him the Nobel Prize.

In the standard formulation of the Asian disease problem, people choose between two programs to combat an unusual Asian disease: program A, which offers certainty; and program B, which involves a risk.

The original research showed that people change their preferences between the two programs depending on how the options are described.

People tend to select the more certain program A if it is framed as a gain. Specifically, 72 percent of respondents preferred (A) “200 people are saved out of 600” while 28 percent picked the riskier (B) “1/3 probability that 600 people are saved and 2/3 probability that no one is saved.”

That may seem rational. However, change the wording and the results also change – even though the theoretical loss of life remains the same.

Program A was preferred by only 22 percent of the recipients when researchers framed the choice like this: (A) “400 people will die out of 600” versus (B) “2/3 probability that 600 people will die and a 1/3 probability that no one will die.” With this wording, 78 percent choose the riskier option. This is because people tend to focus on emotionally salient information like “save” and “die.”

Emotional appeals less powerful

Our new research revisits this classic problem to study what would happen if the respondents were choosing which program to reject instead of which one to choose. Would people be swayed less by the attention-grabbing words like “save” and “die”?

When we asked respondents which program would you reject, respondents’ selections were affected less by the use of the emotional words. Program A was selected by 48 percent in the first pair and 43 percent selected it in the second. In other words, the decision between program A and program B was similar, whether “save” or “die” was used to describe the programs.

The study results indicate that wild in-your-face claims made by candidates will get less weight if people use rejection strategies to vote.

Princeton psychology scholar Eldar Shafir has also found that rejection makes people focus on negative attributes. Perhaps the candidates’ campaign managers know this already and that is why the negativity in this election has been so high. But, the point to remember is that this cannot be a shallow negative attribute like sounding bossy or having a spray-tanning habit. People voting by rejection will be more deliberate – and will look carefully at what makes a candidate bad. Emotional claims will not work. Voters will think carefully about why they want to reject one of the candidates.

Why the web has challenged scientists’ authority – and why they need to adapt

THE CONVERSATION – March 1, 2018 
by Andrew Hoffman

Academia is in the midst of a crisis of relevance. Many Americans are ignoring the conclusions of scientists on a variety of issues including climate change and natural selection. Some state governments are cutting funding for higher education; the federal government is threatening to cut funding for research. Resentful students face ever increasing costs for tuition.

And distrustful segments of society fear what academia does; one survey found that 58 percent of Republicans and Republican-leaning independents say colleges and universities have a negative effect on the way things are going in the country.

There are multiple causes for this existential crisis, but one in particular deserves special attention. The web is fundamentally changing the channels through which science is communicated – who can create it, who can access it and ultimately what it is. Society now has instant access to more news and information than ever before; knowledge is being democratized. And as a result, the role of the scientist in society is in flux.

But rather than facing this changing landscape head on, research shows that many in academia are resisting its inevitability. In many ways, this response has parallels to that of the Catholic Church in the wake of the invention of the printing press and its role in hastening the Protestant Reformation. I hope this comparison offers a compelling provocation for the scientific community to come to grips with the cataclysmic changes we are now living through and ignore at our peril.

Disrupting the Catholic Church

Developed by Johannes Gutenberg in the mid-15th century, the printing press made books cheaper and easier to produce. Where a monk might be able to copy four or five pages a day, a printing press could produce as many as 3,600 a day.

Fifty years later, Martin Luther leveraged the printing press to bring about the Reformation, whereas others who previously lacked the technology could not. Building on his 95 theses, hundreds of thousands of his pamphlets were printed, offering interpretations of the Bible that differed from those of the Catholic Church. Others printed their own pamphlets, offering even more interpretations (of varying quality) on what the Bible can and did say. These pamphlets were consumed by an interested public who could now access the Bible directly, since it was one of the first books printed.

In response, the Catholic Church argued that the written word was reserved for “God’s chosen priests” and not for regular people and sought to put the genie back in the bottle by shutting down printing presses, labeling the purveyors of alternative views as heretical and publishing their own pamphlets.

As we all now know, it didn’t work. The world changed in ways that were unstoppable. The Catholic Church is now one of many authorities on the Bible, as there are now a variety of accepted approaches to interpreting scripture that build off of various traditions, often with interchange and collaboration among them. In the coming decades, it would be reasonable to expect the same fate for today’s notions of science.

The web and ‘alternative science’

The arrival of the World Wide Web has many parallels to the emergence of the printing press. By the mid-to-late 1990s, the web had grown in distribution and come into common usage.

One outcome of this wider usage, particularly as we entered the 2000s, was easier access to scientific information from a wider variety of sources. And, just as had happened to the Catholic Church, the academy and scientists are being displaced as but one arbiter of scientific knowledge among many. Though competing and questionable scientific findings are not entirely new – notably on the link between cigarettes and cancer in the 1960s – the web now makes it possible for the general public to mine the web for scientific information on a completely different scale and either draw their own conclusions or rely on other’s interpretations about what it says.

Ask any doctor today what it is like to offer a diagnosis with a proposed treatment plan and have the patient offer their own web-based diagnosis. Ask a parent who chooses not to vaccinate their child for fear of autism or someone who denies the science of climate change, and they can present a string of web-based scientific studies to defend their position.

 

There is now a proliferation of alternative science (of varying quality) through media outlets and pseudo-scientific journals that leave many within academia discouraged and demoralized.

The academy has, in effect, entered its own period of “reformation” with its authority in flux. Just as the Protestant Reformation was anchored in some very legitimate criticisms of the Catholic Church, notably indulgences, this reformation is anchored in some very legitimate criticisms of academia – rising tuition, perceptions of a liberal bias, charges that scientific research cannot be reproduced and thus verified, and questions of the social value of much academic research.

But, many scientists are responding to this reformation’s challenge by trying to question the validity or credentials of other voices, or dismissing misinformed people.

Research shows that many scientists do not see it as their role to educate the public and can be dismissive of both those who do and the channels with which they do it. Surveys show that only 24 percent, for example, admit to writing blogs and nearly 40 percent vow never to use Twitter or Facebook for academic purposes despite the reality that we have a president who has shown the rising influence of social media.

Indeed, there are many within the public who feel a distasteful level of condescension and disdain from academic scholars who see themselves as separate and superior. In the words of one scientist, writing in the comments section of an online essay on this topic, “I would love to explain (my research to the public) but I cannot. I cannot teach my pet hamster differential equations either.”

But this attitude only erodes the trust between the public and the academy. Just like the church’s failed response to the Reformation, this resistant and defiant response won’t work either.

Taking to the web

In the face of the changes wrought by the web, the academy must evolve in multiple ways. For example, scientific research in the 21st century should find ways to break down the artificially narrow disciplinary silos that have come to dominate academic life, and link multiple disciplines in research that reflects the complexity of real-world issues.

Next, it must move toward transdisciplinary research to recognize the knowledge that emerges from interacting with communities outside the academy and resides in places other than academic journals, including the web. Local communities, for example, can be useful partners in urban research studies and business, and nonprofits can have much to offer in research projects that study the market.

Further, colleges and universities must accelerate teaching of how to become discerning consumers of online content, being able to distinguish rigorous and objective research from content that may have a political agenda and bias, or represents shoddy or unreliable methodology, data and review.

Next, scientists will be expected to communicate more effectively with consumers of scientific knowledge to explain not only what its research shows, but also how it arrived at its conclusions and the value those conclusions bring to society. This task will involve a new set of skills in communication, storytelling, narrative and the use of the web that scientists lack today.

Some within the academy are beginning to adapt. Indeed, studies find that some academics use the web to boost their professional presence, post content related to their work, discover related peers, find recommended research articles, test new ideas and participate in discussions on research-related issues. One study even found that social media platforms like Twitter increase exposure for academic research within the academy.

Such shifts will be impossible if they are not supported by new forms of training and rewards. And some signs of change are becoming visible. The American Sociological Association published a report on how tenure and promotion committees might consider researchers’ involvement in public communication and social media.

The Mayo Clinic and Michigan’s Ross School of Business have gone one step further, adding social media and professional impact, respectively, to their annual review processes. New metrics, like Altmetric and Impact Story are searching for ways to quantitatively measure such practical impact. And, going to the source, Responsible Research in Business and Management is seeking to promote more top-tier research that addresses problems important to business and society. These changes reflect the growing interests of a new cadre of doctoral students and junior faculty who want to have more real-world impact with their work.

In the end, the challenges that science and the scientist now face offer an opportunity to revitalize the academy by connecting it more deeply with the society and world it studies. It also offers the opportunity to revitalize our democracy by increasing the scientific literacy of an informed electorate. Both foretell an evolving role of the scientist that is more in line with what many have long seen as its special and honored place in society, not separate or above it, but part of it. In many ways, this is the fulfillment of the social contract that many believe the scientific community has always been obligated to honor.

Ted London Wins Book Award for “The Base of the Pyramid Promise”

AUGUST 2019 – The International Humanistic Management Association (IHMA) awarded Ted London the 2019 Humanistic Management Book Award for Practice for his book, The Base of the Pyramid Promise.

The book draws on over 25 years of experience across some eighty countries, and offers concrete guidelines for how to build better enterprises while simultaneously alleviating poverty. London outlines three key components that must be integrated to achieve results: the lived experiences of enterprises to date—both successes and failures; the development of an ecosystem that is conducive to market creation; and the voices of the poor, so that entrants can truly understand what poverty alleviation is about. London provides aspiring market leaders and their stakeholders with the tools and techniques needed to succeed in the unique, opportunity-rich BoP.

Ted London is an internationally-recognized expert on enterprise strategy and poverty alleviation. He is Vice President of the William Davidson Institute and a faculty member at the Ross School of Business, University of Michigan.

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Michigan Daily: Ross launches +Impact Studio for cross-campus collaboration on social issues

BELOW IS A REPRINT OF AN ARTICLE FROM MICHIGAN DAILY, SEPT. 22, 2019: 

Business School Dean Scott Derue told The Daily the aim of the studio is to create a space for graduate students and faculty to work together to solve issues aligned with the United Nations Sustainable Development Goals. 

“First and foremost, we believe that business has to be part of the solution — with government, policy, nonprofits, the whole range of institutions in our society — business has to be a collaborative partner with those other institutions on developing solutions for some of the global challenges that we face,” Derue said. “Our Business Impact is really meant to catalyze and mobilize our faculty and our students to work together to develop these solutions.”

Last semester, Ross ran a pilot +Impact Studio course focused on water safety. Their work centered around a machine learning algorithm developed in partnership with the University of Michigan-Flint to identify which buildings in the city of Flint are most likely to have lead pipes. Students also worked on figuring out how to scale out this technology to maximize its impact on communities outside Flint. 

Derue explained the course is meant to be an opportunity for students to identify important issues to find solutions for collaboratively.

“The idea is that we will continue to add issues, challenges, and opportunities that align with the UN Sustainable Development Goals,” Derue said. “It’s really student and faculty driven — you tell us what you want to work on, and that will be the area of emphasis for the +Impact Studio.”

According to Jeffrey Sanchez-Burks, faculty director of the +Impact Studio and professor of the +Impact Studio course, the layout of the studio is designed to foster conversation. The space includes a number of studios where students work on whiteboards, developing ideas and research that is then digitally captured. It also has a living room space for more organic conversations about the issues. Students spend the first term of the +Impact Studio course researching and developing a nuanced understanding of their issue as they determine their focus, and the second term solving the problem and putting their thoughts into action. 

The course is open to both Business graduate students and students from across University graduate programs. Sanchez-Burks emphasized the importance of having a diversity of viewpoints involved in problem solving. 

“One of the things we’re really trying to do is use this space and this studio as a hub for the whole University,” Sanchez-Burks said. “Over at Ross, you’ll get to work with a huge diverse group of students tackling real problems. Critically, no real solutions can actually be developed without that diversity. We need people with that lens in Policy, Public Health, School of Information, Social Work and the MBAs.  

Business graduate student Allison Winstel, who attended the event and hopes to take an +Impact Studio course, said she was drawn to the opportunity to use business for social change.

“I picked the University of Michigan when I was looking at graduate programs because of its focus on social impact, and I felt that it had a really differentiated focus on looking at how business can play a bigger role in the entire ecosystem that creates more sustainable social change,” Winstel said. “For me, things like the +Impact Studio  were exactly what I was looking for — really hands on, unique opportunities to talk about how we take a more interdisciplinary approach to change, and I’m excited that this is an opportunity to do it within my coursework, outside of it, and with my peers in the school.”

Winstel added she was excited to work with students outside of the Business School.

“I think it’s just a really unique opportunity to work with people from different programs. All of my core classes right now are with MBA students, so it will be nice to get outside of that and see how people from different schools and different backgrounds approach change and approach problem solving,” Winstel said.

 

B+I’s +Impact Studio a highlight of Poet and Quants’ “Most Interesting New MBA Courses”

 

SEPT. 22, 2019: Poets and Quants published its article “The Most Interesting New MBA Courses at B-Schools This Year,” and under the Ross School of Business, they said that among the courses “that relate back to the school’s mission to use business to make a positive difference in the world”  the +Impact Studio “serves as a nexus between this intellectual capital, a wicked problem and design.”

The other featured course for Michigan Ross was Gautam Kaul’s International Investment Fund.

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Second Annual Business+Impact Showcase Features 35 Impact Organizations

Ann Arbor, September 11, 2019 – As part of Business+Impact’s mission to make students aware of all the impact opportunities across campus, B+I welcomed incoming and returning students to its second annual Business+Impact Showcase on Sept. 11 at 3 pm at Michigan Ross. New and returning students from across campus met with 35 exhibiting organizations from U-M in areas of interest like social justice, equality, sustainability, social entrepreneurship and economic development.

Students visited booths for student clubs, Ross centers, and U-M-wide initiatives. A complete list of exhibitors appears at the end of this article. Michigan Ross Associate Dean for B+I Jerry Davis thanked the exhibitors for presenting a cross section of the many opportunities to engage in social impact and sustainability across campus.

He also mentioned that the Impact Gateway (http://rossimpact.com), is the online version of this event, available 24-7 throughout the school year.  This gateway lists clubs, colleagues, current events, courses,  and more for student changemakers. It is the only resource of its kind at the University of Michigan.

The Business+Impact initiative hosts this event annually in order to provide new students with a roadmap for work in sustainability, social issues, poverty, economic development, human rights, and other causes. Michigan Ross, as the home of the Erb Institute, the Center for Positive Organizations and the William Davidson Institute, has already established itself as a school teaching that business can have a positive impact in the world; the growth of B+I will institutionalize these goals with research, practicum and partnerships.

View a photo album from the event (on Flickr).

Complete list of exhibitors:

CONTACT: Glenn Bugala, Marketing Director of Business+Impact at Michigan Ross

PHOTOS AVAILABLE

Social Impact as a Competitive Advantage: Amulya Parmar’s Takeaway from his invitation to the United Nations

Amulya Parmar at the United Nations, on his reinvitation in 2019

On any given day, there are about 2,000 people at the United Nations. These 2,000 people speak for 7 billion others. The list includes luminaries, world leaders, and C-level execs. And this coming September… that list included, albeit for a brief time, a junior from the University of Michigan. 

Hi, my name is Amulya Parmar. I am a junior in the BBA program at the Ross School of Business and Computer Science Engineer with the School of Engineering. 

I was originally invited to the United Nations because of my nonprofit HostYourVoice and its work with PVBLIC.org. One of my first employees became an international photographer for the United Nations, and since we supported individuals like him as well as our international partners like Kidskintha, the PVBLIC organization, the media subsidiary of the United Nations gave us an invitation with open arms.  

Two years ago, we helped put on for the Media for Social Impact Summit at the United Nations with the help of four partners.  Last year, we were re-invited as VIP guests to the Summit, eventually partnering with Givewith, a sister company of CBS, and hiring a few interns from right here at the University of Michigan for our collaboration. This September, with the support of the Ross Business+Impact Initiative, I will be going back to the United Nations not just representing my organization HostYourVoice but also as a Business+Impact representative. 

Amulya Parmar’s organization Host Your Voice was chosen as one of the 300 leading social enterprises in social impact internationally 2017-2019 at the UN Summit

The first year and second year I went to the United Nations–okay, I’ll admit–I didn’t necessarily fit in. But I never said I wanted to fit in, did I? Usually, I am the youngest individual in the room, but the thing that makes the United Nations special is that the UN realizes the role younger generations’ Gen Z and millennials or “digital natives” will play in solving the next generation of world problems.

It’s startling, if anything, that being a part of Generation Z is an advantage.  

One of my most important takeaways, in my visit in the United Nations this year, was that our Generation Z is the “first generation that can truly solve world hunger and education, but is one of the last that can solve problems like climate change.”

We aren’t just the first generation to be digital natives, we are also the largest generation in the history of the world (about 2.1 billion individuals), and will have the ability to effect scale on magnitude unseen before. 

Although, Peter Parker AKA Spiderman slung his webs in New York City, the words of his Uncle Ben still ring true: “With great power comes great responsibility.” It is our job as both the advocates and enablers of social change. 

You can meet many different types of individuals at the United Nations: Activists, Politicians, Artists, and Tourists. 

Yet my most life-altering conversation was with an entrepreneur named Paul Polizzotto. Paul has been a social entrepreneur before the term was invented.

He doesn’t come from the marketing world or the tech world. Since he was 25, he has been building for-profit businesses that simultaneously better the lives of people in communities across the country. He jokes that he hasn’t worked for anyone his entire life — that is until his business was acquired by CBS for an undisclosed sum.

Yet one of the most interesting parts of Paul’s story was that he was able to empower over $100 million dollars in financing for nonprofit projects across the United States without fundraising a single dollar for charity. 

How? Well. Here’s how Paul explains it:

“For years, advertising was a monopoly business. There were a few networks that controlled which businesses could have access to advertising to their millions of viewers. The likes of ABC, CBS and Fox. However, as time brought more mainstream networks like HGTV, CN, Disney and more, advertising became much more of a commodity. Anyone could have access to it. 

“With the advent of the Internet, the commodity-like nature of advertising became even more pronounced. Prices quickly fell, and even more businesses started advertising. Supply was greater than demand. 

“So for the first time, the conversation with advertising went from spray and pray to pay to say. Subsequently, a lot of attention was paid on what was said in every advertisement. 

“Companies now had to be creative and innovative with how they produce advertising in order to get results.

“Instead of serving primarily the businesses, advertising became a function of serving the customer. The best deals. The exclusive discounts. Or in the case with EcoMedia, consumers could be enabled to impact the lives of other individuals just by consuming an ad.”

See Ecomedia placed social impact at the center of its business. Paul’s thesis was that brands would spend an inordinate amount of money on traditional advertising to prove that their brand stood for something greater than a cap.

 

My greatest takeaway from the United Nations is simple. We, Generation Z, as the next generation that has the opportunity to invent new businesses that impact the world, we have the ability to reinvent the business models that fundamentally change the platform on which all businesses operate.

Till next time, your Business+Impact Ambassador 2019

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Net Impact @ Ross Awarded Gold Chapter Status

Earlier this summer, in recognition of their hard work as a chapter, Net Impact @ Ross received Gold status from Net Impact Central. The chapter accomplished a great deal in the 2018-2019 year and NI Central said it was excited to see what your chapter does this school year.

Net Impact Central will be announcing the full list of Gold chapters on their site to share Net Impact @ Ross’  great stories with the larger Net Impact community.  As a Gold chapter, Net Impact @ Ross has also been entered into the running for Chapter of the Year and is promised special status at the 2019 Net Impact Conference in Detroit Oct. 24-26.

Business+Impact is proud of this extraordinary club and close partner in the work of impact for business.