NYU Stern’s Center For Business & Human Rights: A First For B-Schools Around The World
Mike Posner teaches a class at the Center for Business and Human Rights at the NYU Stern School of Business. Founded in 2013, the center is the first of its kind at a business school anywhere in the world.
Mike Posner is a lawyer by trade. He taught law for many years at both Yale and Columbia, and he was executive director of Human Rights First for more than three decades. In the Obama Administration, he served as Assistant Secretary of State for Democracy, Human Rights and Labor.
So when he started talking with his friend and former president of New York University, John Sexton, about the complex issues surrounding the intersection between human rights and business practices, Sexton encouraged him to come to NYU and create a center for human rights at the law school.
Posner had another idea.
“No, I want to be in the belly of the beast. I want to go to the home court,” he told his friend. “I want to go where businesses live and operate, and where they feel comfortable. I want this to be part of business education.”
THE INTERSECTION OF BUSINESS AND HUMAN RIGHTS
In 2013, Posner founded the Center for Business and Human Rights at the Stern School of Business. It is the first center dedicated to human rights in the world to be positioned inside a business school. He still directs the center eight years later, but it now has 10 full-time team members with backgrounds in public policy, law, scholarship, and journalism. “We’re united in our belief that companies should be profitable and competitive while benefiting the people who make their success possible,” reads the center’s website.
Mike Posner, founder and director of the Center for Business and Human Rights at NYU
Academically, the center serves business students at all levels. It started with a course for MBA students, but Posner also teaches at least a couple of classes for the Executive MBA program. Next month, the center is offering its first undergraduate course, while center team members also teach and integrate its research into core undergraduate classes such as Law, Business, & Society; Business & Political Economy; and Business & Its Publics.
“At the beginning, nobody had any idea what we were doing when they applied to Stern. Now, we have a number of students who have written their admissions essays about wanting to come to Stern because we are leading on human rights,” says Posner, the Jerome Kohlber professor of ethics.
“I think Stern feels like this is a differentiator for NYU. We are leading on human rights for a growing number of students who want to study it in course offerings and work on it in their extracurricular work.”
In this conversation with Poets&Quants, Posner explains why he thinks human rights should be a topic of study for the future leaders of business.
Tell us a little more about the decision to position a center for human rights inside a business school.
When I was at Human Rights First, I helped start the Fair Labor Association, working with tech companies to create the Global Network Initiative, and I worked some with the oil and mining companies. So, I had some background in all of these things going back to the 90s. In the Obama Administration, I was running the Human Rights bureau in the State Department. My mandate was democracy, human rights and labor, so these issues sort of came up again.
I realized increasingly that our government is less comfortable advising, guiding, or analyzing what American companies do globally than it is promoting exports or doing public-private partnerships. It’s very keen to go to Microsoft in order to get technology to help track refugees, or to get American companies to help our balance of trade. But when it comes to actually evaluating company conduct, the Commerce Department, Treasury, even the economic bureau of the State Department, leave that alone. I view that as an opportunity.
So, I kept raising my hand to work on these issues. For example, I chaired something called the Voluntary Principles on Security and Human Rights which was created in 2000 to bring mining companies, NGOs, and governments together to look at challenges in the mining industry when a mine is in a conflict zone. I also dealt with blood diamonds through the Kimberley Process. I kept being the only one raising my hand, and so there I was in the middle of all these conversations.
One of the things that occurred to me, honestly, was that our government operated on the theory that everything that really mattered is decided around a calm, big conference table where you have 190 governments come together with their placards and their flags, and they make decisions about how the world is supposed to operate. That might have made sense in 1955, but it doesn’t make sense in today’s world.
When did it start to occur to you that the intersection between human rights and business should be a focus of academic study?
Three examples made me realize that there was a big subject here: One, if you look at the world, we are spending hundreds of billions, trillions of dollars trying to deal with the scourge of terrorism and extremist violence — ISIS and al Qaeda and the like. Well, they may have a flag, but they don’t come to diplomatic meetings. Then there’s a slew of social problems, whether it’s the pandemic or hurricane or natural disasters and all kinds of environmental problems, where governments, even the richest governments, don’t have the capacity to do what they’ve set out to do. And the third piece is business. You know, we sort of operate on the theory that governments are more powerful than business, but if you look at gross domestic product versus revenues, the biggest economies in the world are not states, they’re private companies. Walmart has a revenue of $530 billion a year making it the 24th biggest economy in the world. And I kept saying to people, ‘Why don’t we have an ambassador to Walmart?’
When a company of that size or an Exxon goes in, or any of these huge multinational companies that operate in weak states, they’re important players for good or for ill. We need to recognize that the world has changed and governments now are often challenged by companies. That was my mindset when I came out of government. I said this is too big of a subject to be underserved the way it is.
How receptive was Stern when you approached them about creating a center dedicated to human rights?
We had a very sympathetic dean in Peter Henry, and when I came and presented it to him, he was quite enthusiastic.There was a mixed reaction, honestly from the faculty. We’re part of a quasi department which is called Business and Society, and the guy who headed that at the time, Bruce Buchanan, was enthusiastic from day one. There were other people who were thinking, ‘What is this? We’ve never seen this. What does this have to do with business education?’ So we had a little persuading to do, and I decided to do that by doing things. A combination of teaching, research, and engagement has been our model from the beginning.
The homepage of the Center’s website
I think we have, over eight years, demonstrated that this is a real subject, that it can be done with academic rigor, and it can actually make a difference. The reality is these are the issues that a lot of business leaders struggle with. These are the things that keep leaders of Fortune 500 companies up at night, often when they get caught in the middle of a crisis. It’s important for business schools, teaching the next generations of leaders, to prepare corporate leaders about the subject.
How has the center grown since 2013?
I would view the growth in a couple of different ways. One, we are teaching more classes. I teach basically an MBA only class in the fall and a course in the spring that’s half business and half law students, which is interesting in its own right. They think very differently. I can tell who the law students are and who the business students are. The law students want to regulate, litigate, and legislate, and the business students want to make a deal. Beginning this spring, a colleague is also going to teach an undergraduate course and there’s a lot of interest. Our courses are fully and over subscribed.
The second measure of growth is the students interested in working with us. That is through student volunteers, work studies, and our summer fellowship program, which has really grown as more and more companies and more and more students have shown interest. We also help students in recruitment, and more and more students are getting hired by companies to do this kind of work.
Finally, our staff has grown from two — I came with a colleague from the State Department — to 10 full-time positions. A lot of the work we’re doing is research on different industries and a lot of engagement with companies. We say that we’re pro business, but we want high standards. So we’re trying to apply that in manufacturing supply chains and with migrant workers in construction, for example. With the tech sector, we’re doing a lot looking at misinformation, a range of online privacy issues. And in the investment space, we’re looking at both the ‘S’ in ESG, which is underserved right now, and looking at the lack of diversity among the asset managers. We’ve got a big project now looking at universities and who their university investment offices are hiring, which asset managers, and how many of them are run by women or underrepresented minorities.
NEXT PAGE: Interest in ESG is rising, but can still be a heavy lift.
‘If the notion is that business schools ought to be preparing future business leaders, there’s no doubt that business leaders are going to be called on to address these questions. I view this as an opportunity for business schools to provide what the business community wants and needs,’ says Mike Posner, founder of Stern’s Center for Business and Human Rights.
Do you find interest in ESG issues is increasing? Or what can you say about interest over the last decade or so?
I’d say a couple of things. First of all, ESG has only really been around for about 15 years. I don’t quite know how they put the ‘E’ and the ‘S’ and the ‘G’ together, but traditional concerns about governance have been going on for a long time. Huge interest in the environment and especially in climate change, and that’s where there’s been a lot of growth. The ‘S,’ the social — which to our minds needs to include labor and human rights issues — has been left behind. There’s a lot of money now pouring into ESG funds; I think it’s $20 trillion. Goldman Sachs, BlackRock, everybody’s got an ESG fund or two, but they are really ‘E’ and ‘G’ funds, and the ‘S’ is all over the place. So we’re very focused on one, calling out the gaps in the ‘S’, and two, trying to figure out frameworks that makes sense.
Explain a bit more about what the Center is working on right now.
There are two aspects to what we do. We are, in the first instance, radiologists. We do X-rays of industries, evaluate the challenges and look at how it relates to business models. We’re much more interested in how companies make money as opposed to how they give it away. In the second instance, we’re not just diagnosing the problem, we’re making recommendations to address it and then trying to work with companies to do that.
To give you an example, we’ve done a lot of work with the apparel industry, and we came up with 13 metrics for better purchasing practices. The relationship between buyers and suppliers is key to improvement on human rights. If a company, a big global buyer, is not consulting with their suppliers about the design of a product, that’s going to cause problems. If they’re changing the order last minute, it’s going to add costs. If they’re not compensating their suppliers adequately, that’s going to add pressure for the suppliers to cut down the margins. Buyers have so much leverage that when they make demands on their local business partners, it causes those business partners to cut corners in order to make a living and that results in long hours and insufficient pay for the workers. We have spent the last couple of years trying to get companies to actually embrace this model and test it. It’s a challenge, but that’s what we do. We keep trying to come up with very practical ways for companies to do work differently, and then try to push them to do it. Sometimes we succeed and sometimes we don’t.
What’s something emerging from the center of which you are particularly proud?
You know, we were the first business school to tackle this subject, and our notion always was that we’re not going to succeed if it’s just one school. There needs to be multiple schools raising these issues in different ways. With a colleague in Geneva, who’s now started the Geneva Center for Business and Human Rights at the Geneva School for Economics and Management at Geneva University, we’ve begun to act like missionaries proselytizing: This is something you too can do. We’re now working with a group called the Global Business School Network which is a collection of about 120 business schools around the world. I think we had 60 schools that came to the meeting last month, and we have seven different work streams. One group is looking at gender and human rights, another one is looking at supply chains, and so forth, and each of those groups are now working together. So there may not be a full center at every school, but there’s an awful lot of energy.
Do you feel that momentum on these issues is building on the business side?
Yes. I would say in every industry where we’re working, there are leaders who have taken the leap to say, ‘We actually have to figure this out and get ahead of the curve.’ Does that mean that everybody in the industry is doing it? No. Does it mean that there isn’t still anxiety about getting out front? There’s always anxiety about committing resources, time and energy to something that might be risky publicly when your competitors are sitting and hiding under the table. But I would say in every area we’re working, we’ve identified good companies that are aligned with what we’re trying to do. The challenge for us, and for them, is to come up with an industry approach — industry standards and metrics — where you get a number of competitors sitting around a table saying these are things we need to do. Essentially creating a leadership model that others then feel they have to follow.
New York University’s Stern School of Business
Where does the Center go from here?
First of all, for us, I think the model is right. We’re 10 people focusing on four or five industries, but there are major industries that we haven’t touched at all. We don’t have somebody focusing on mining as a primary focus, although we’ve done some work with cobalt in the production of batteries in the Congo. We haven’t focused on the drug industry, pharmaceuticals, so there are big gaps in what we know are real issues. We just haven’t had the resources. So for us, we want to grow and be available as a resource in all of those industries.
The second thing is to develop more of these multi-stakeholder approaches, so that it’s not just a one off or a company trying to figure out what the best practices are for them. Taking not only an industry-wide approach, but one that engages other stakeholders — local communities, civil society organizations, governments and others — to have a comprehensive approach for each industry.
The third thing would be just to make this a more integrated part of business schools. I don’t expect every business school to have a Center on Human Rights, but I do think there ought to be at least the option at every school to take a course that focuses on human rights, as well as integrating human rights into existing curricula. For example, business schools teach operations. There’s generally a course on supply chains which tends to focus on logistics. That’s totally legitimate. But, I would hope to see that every supply chain course includes a session on the workers in the supply chain and how to protect their rights. I could do that through every area of business education. Certainly within finance, within economics, looking at the ‘S’ in ESG.
Do you see more interest in business schools in this kind of approach?
We’re in conversations all of the time. You need two things: You need deans, the leaders of business schools, to treat this as a priority. So, I make every effort to find the deans and bend their ears. And you need an early adopter on the faculty. It’s not likely that a lot of schools are going to go out and hire a human rights expert to a faculty position. So, you need to find somebody who’s teaching something that touches on this, who has an interest and a willingness to adapt and bring this within the four corners of how the school allocates resources and designates courses.
But I’m encouraged. There’s a lot of interest, and I think we have the wind at our backs. This is the way the world is going. If the notion is that business schools ought to be preparing future business leaders, there’s no doubt that business leaders are going to be called on to address these questions. I view this as an opportunity for business schools to provide what the business community wants and needs.
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