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The world increasingly expects business schools to produce solutions to societal challenges, as well as graduates who give back to their communities and promote business practices that support a more sustainable and inclusive economy. But whether because of resource constraints or competing internal and external stakeholder interests, many business schools still don’t match their actions in the market to their aspirations to make a difference.

They also face pressure from the rankings, which have become very effective at measuring a business program according to the salaries of its graduates but less useful when it comes to measuring a school’s social impact.

This disconnect has inspired a large group of business educators—brought together by the Mission Possible Foundation based in Switzerland—to design the Positive Impact Rating (PIR). Its creators are calling the PIR the first “by students for students” rating of business schools. These educators hope the PIR will encourage more business schools to couple their actions with social impact. 

They spent two years developing the rating in workshops with the help of experts from around the world and developed the first prototype in May 2017. Subsequent versions were tested in schools of different sizes, missions, and locations. The final version was adopted by the endorsing organizations in September 2018. 

In January 2019, the steering committee released a white paper outlining the reasons behind and structure of the PIR. The paper’s co-authors include Katrin Muff of the Mission Possible Foundation, Switzerland; Thomas Dyllick of the University of St. Gallen in Switzerland; Mathias Falkenstein, CEO of the Higher Education Management Group in Berlin, Germany, and executive policy advisor at LUISS Business School in Rome, Italy; Clémentine Robert, president of oikos International; David Scicluna, president of AIESEC Switzerland; and Léo Gillard, World Wildlife Fund Switzerland.

The new rating system is intended “to support fundamental change in the business school landscape with regards to the school’s societal responsibility,” the co-authors explain. This includes embracing the United Nations’ Sustainable Development Goals and placing emphasis on the responsibility of business schools “as custodians of society.” The rating is endorsed by several organizations that reflect this focus. These include WWF Switzerland, which represents the environment; Oxfam, which represents society; and UN Global Compact Switzerland, which represents the voice of business. 

Those who created the PIR hope that it will become a valuable tool that students can use to select business schools that educate with global responsibility and citizenship in mind. They deliberately chose to make the assessment a rating rather than a ranking. According to the white paper, a rating “enables schools to augment awareness and inspire improvements rather than simply worry about the results.” In addition, a rating system is more inclusive than rankings, allowing all schools to be recognized for their impact, rather than only an elite few. 

Impact in Four Dimensions 

The current PIR asks stakeholders questions about nine areas that fall under a business school’s purview. These areas are organized in four dimensions: energizing (which includes the areas of governance and culture), educating (programs, learning methods, and student engagement), enabling (research and continuing education), and engaging (institution as a role model, public engagement). Participants are asked to assess their perceptions related to each area on a ten-point Likert scale, from “I don’t agree” (1) to “I completely agree” (10)—they also can respond “I don’t know” (0). 

In the future, business schools will be able to choose one of two forms of the assessment. Initially, the 20-question Student Assessment asks students to provide their perceptions of their schools in seven of the nine areas.

In future iterations, schools can opt to conduct the full 36-question assessment, which elicits feedback from a total of six stakeholders (students, faculty, alumni, administrators, career services staff, and program managers). These stakeholders are grouped into two complimentary groups so that the rating can highlight the difference—or spread—in score between the two stakeholder perspectives.

The full assessment will allow business schools to understand “the more complex and differentiated perspectives of how the school’s impact is currently seen,” write Muff, Dyllick, Falkenstein, Robert, Scicluna, and Gilliard. 

Leveling Up 

A business school’s score in each dimension is used to determine its impact rating on a scale from 1 to 5. Level 1 schools are perceived by stakeholders to be mostly unaware of the opportunity of creating social impact, while Level 5 schools are perceived to be making a real difference by changing society for the better. These scores can be further broken down by area and by dimension or by study level.

PIR provides student organizations and schools their own data for more detailed analyses. They will receive qualitative feedback in the form of answers to the following open-ended question at the end of the assessment: “What is the most important thing your school should stop, start, and continue doing in support of its commitment to providing management education that results in positive impact for the world?” 

The inaugural PIR student assessment was conducted in late 2019 by oikos International, Net Impact, AIESEC, Students Organizing for Sustainability, and Studenten voor Morgen. These organizations conducted surveys at about 100 business schools worldwide. The results of the first PIR student rating will be unveiled at the World Economic Forum in Davos in January 2020. Relevant stakeholders will be invited to review and improve the PIR’s effectiveness in the upcoming years.

Shifting Attention 

While current media rankings place the most emphasis on graduates’ salaries, the PIR shifts attention toward how the school is perceived by key stakeholders. The PIR is designed as a tool to enable individual schools to highlight the impact they make through their own strengths in their culture, outreach, teaching, and research at their unique locations. 

“The rating … leaves room for the schools to define their own ways to fulfill their mission,” write Muff, Dyllick, Falkenstein, Roberts, Scicluna and Gilliard. Because the PIR is based on stakeholder perceptions, they add, it “recognizes the fact that different visions and strategies can serve society, in particular for schools in very different locations and environments, which are also dynamically changing.” 

Members of the PIR General Assembly will be tasked with verifying each school’s rating, based on the data collected. Schools that use the PIR will see only their own ratings—they will not see results from other schools. Schools that wish to publicize their verified ratings can use the PIR logo for external and internal communications. The first schools that receive Level 5 ratings will be presented in January at the 2020 World Economic Forum, as well as featured on the PIR website.

Future Directives

A stronger sense of accountability will help business schools measure the real relevance and impact they provide for society, says Falkenstein. “This will require business schools to further reinvent themselves and find a common purpose for their existence, which includes a radical rethinking of management education paradigms,” he argues.

Eventually, he imagines that the PIR might inspire participating schools to exchange best practices or collaborate to deliver joint degrees and research.

He and his colleagues hope that the PIR will inspire schools to adopt institutional changes that lead to a more responsible and sustainable management education. These changes include embracing disruptive, rather than incremental change; promoting cultures of innovation in the ways they create and disseminate research; and designing curricula in ways that train students to become management innovators. Schools that use the PIR to evaluate their activities, the authors note, also will be more likely to prioritize research with relevance and impact on society—not just research published in A-journals.

In these ways, “business schools will be able to change toward more responsible management education,” says Falkenstein. “By doing so, they can become an important interface between business, government, and the society that demands this change.” 

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