Empowering Business and Social Impact

Led by former Dean Laura Tyson, a new institute at Haas is rethinking the role of business in society.

What role should business play in solving the most intractable problems of our time? This sometimes controversial question has provoked the thinking and teaching of business school faculty at UC Berkeley since the 1950s, when the first courses on corporate social responsibility were offered here.

Building on its rich history, the Haas School took another big step to propel the movement forward with its launch of the new Institute for Business and Social Impact in November 2013. Led by Professor and former Dean Laura Tyson, the institute’s ambitious goal is to inspire and empower the Haas community to develop pioneering solutions for pressing social and environmental challenges.

At the core of the institute’s mission is the conviction that addressing society’s largest problems requires leadership and cooperation from all sectors—for-profit businesses, nonprofit organizations, social enterprises, and government.

“These problems are simply too big and complex for any one of these actors to solve by themselves,” Tyson said pointedly at the institute’s launch event.

The institute brings several units at Haas under one umbrella: the Center for Nonprofit and Public Leadership, the Center for Responsible Business, the Graduate Program in Health Management, and the Global Social Venture Competition. Tyson also plans to launch a women’s initiative and other new programs related to the institute’s mission.

Of course, the careers of countless alumni working at the intersection of business and social impact already have taken wing, set in motion by their passion to think beyond themselves and their education at Haas. Here we feature the stories of three of those alumni, as well as three faculty whose research sheds light on some of society’s most difficult challenges.

Health Care Futurist

Jennifer Liebermann, MBA/MPH 01
Founder & Director, Kaiser Permanente Innovation Center

Jennifer Liebermann

Jennifer Liebermann literally created the job of her dreams: mapping out the future of health care for one of the nation’s biggest and most innovative providers.

Liebermann is the founder and director of Kaiser Permanente’s Garfield Innovation Center. Based in San Leandro, Calif., the 37,000-square-foot facility looks like a mash-up of a testing laboratory, movie set, and Montessori school for adults. It includes a mock operating room, medical/surgical unit, and even what looks like the interior of an ordinary home.

The center tests new technology, from electronic records to robots that make hospital rounds. But it also tests innovative social and organizational strategies to improve health outcomes.

“This is a place where people come together to envision the future,” Liebermann explains. “We run ideas through their paces and give them a chance. Sometimes they don’t work, but successful failures are an important part of innovation.”

Having grown up in San Francisco’s Castro district, where she had seen the ravages caused by HIV, Liebermann arrived at Berkeley-Haas with a passion for improving public health.

"We run ideas through their paces and give them a chance. Sometimes they don’t work, but successful failures are an important part of innovation."

“I was heavily influenced by the entrepreneurship classes that Jerry Engel taught at Haas—when you see a need, you build something,” she says. She also found inspiration in an experimental engineering class, taught by Senior Lecturer Sara Beckman, in which students built actual circuits as prototypes. That hands-on experience made her realize the learning power that comes with making things tangible.

After graduation, she joined Kaiser Permanente, one of the nation’s largest not-for-profit health plans, serving more than 9.1 million members. It was KP’s chief nursing officer who first mused about an innovation center to screen new technologies that were being pitched constantly at nurses. Liebermann soon began working on a more ambitious vision, to explore health care innovation in general.

The idea picked up traction around Kaiser. People working with technology wanted better ways to test new gadgets and systems in a realistic setting. People designing hospitals wanted to experiment with ways to make them more humane and efficient. Building support from many corners of the organization, Liebermann eventually raised the money to get the Innovation Center up and running.

Upon opening its doors in 2006, the Innovation Center initially focused on testing new medical technologies and figuring out the possible ripple effects on health care delivery. One of the first breakthroughs was a system that uses new technology and procedures to improve medication administration. That system is now operating in all 40 of Kaiser’s hospitals around the country.

The center soon broadened out, examining the social and organizational aspects of keeping members healthier. One current project is Imagining Care Anywhere, which looks at how technology can provide health care to patients when they are at home, work, or in community settings.

“It’s Public Health 101, focusing on how to keep people healthy and well,” Liebermann says. “If we can give them a way to refill their prescriptions while waiting for the bus, and help them make healthy eating choices, then we’ll be a lot more successful in meeting their needs and ours.” –Ed Andrews

Teaching Students at Home, Improving Lives Overseas

Paul Gertler
Li Ka Shing Foundation Chair in Health Management

Paul Gertler

As an early pioneer in bringing academic rigor to the evaluation of social programs in developing countries, Professor Paul Gertler has changed how international organizations, governments, and NGOs operate to improve lives around the world.

Take his work in Mexico. Gertler was recruited by the Mexican government to join a four-member team to evaluate the nation’s first large-scale conditional cash-transfer program to break the intergenerational chain of poverty. Launched in 1997, the Progresa program provided cash payments to families in exchange for regular school attendance, health clinic visits, and nutritional support. Gertler’s evaluation included 500 communities with 24,000 households.

“We found massive improvements in health, education, reductions in poverty after just two years,” Gertler says.

As a result, Progresa was sustained across political administrations—a rarity in Mexico—and has more than 5 million families enrolled today. “It has been credited with having a large impact on people’s lives in terms of lowering poverty,” says Gertler.

Earlier in his career, Gertler saw the impact of work published in the journal Demography. The research in Indonesia was one of the first impact evaluations in a developing country and one of the first evaluations to investigate the effect of government subsidies on lowering fertility, which is associated with general economic development.

Using data from a survey of 15,000 women, Gertler and co-author J.W. Molyneaux of Brown University found that the fertility rate in Indonesia dropped by half in 20 years—“really, really fast,” Gertler notes. But the government programs weren’t the major cause of that decline.

“During that same period, the government had mandated that everyone finish primary school. The country also went through an oil boom, and there was a big demand for labor,” Gertler explains. “Women started entering the labor force and the male/female wage difference went down. It was really the empowerment of women and a reduction in the demand for children that explained 75 percent of the fertility decline. The family planning program explained very little.”

Gertler then received a call from the World Bank asking if he believed the results in the Demography article. “I told him that I did, and he said that he was going to use my paper to cancel a billion-dollar loan to the Indonesian government. I was floored,” recalls Gertler. “We realized we could re-allocate funds from programs that didn’t work to information campaigns or sex education programs in schools. That was quite wonderful.”

Since then, Gertler’s work has taken him everywhere from Rwanda to examine pay-for-performance health care to Latin America to study government interventions in illegal slums.

Gertler also believes mentoring is a way to make change. He recalls helping a “super-bright” doctor in Rwanda working on his PhD in epidemiology at Tulane University.

“We brought him into our research project and allowed him to use the data for his PhD thesis, which I wrote with him,” says Gertler. “Now he’s a health economist in Africa and getting attention. We’re helping build the career of someone who is much more likely to have influence on what happens in Rwanda than anything I write.”

Adds Gertler, “I get enormous satisfaction seeing students and former students move into policy jobs in developed and developing countries.” –Victoria Chang

Going Green in Retail

Rob Kaplan, MBA 07
Director of Product Sustainability, Walmart

Rob Kaplan

Eliminate 20 million metric tons of carbon emissions, the equivalent of taking 3.8 million cars off the road. That was the daunting task that Walmart assigned Rob Kaplan on his first day at work: implement the giant retailer’s goal to drastically reduce the carbon embedded in products sold in its stores.

Walmart had already worked out a basic strategy with the Environmental Defense Fund and other groups, but it fell to Kaplan to nail down specific priorities and plans. That meant working with legions of vendors and their supply chains to reduce the greenhouse gas emissions required to produce, ship, and consume products ranging from meat and vegetables to laptops and detergent.

Today, Walmart says it is well along the way toward hitting its goal by 2015, and Kaplan has assumed an even broader job. As director of product sustainability, he is now responsible for improving the overall environmental sustainability of Walmart’s “Consumables” and “Health & Wellness” businesses, including health and beauty products, household chemicals, and pharmaceuticals. On top of that, he oversees efforts to improve packaging (a major source of long-lasting waste), and supervises Walmart’s direct-farm program to enable stores abroad to buy more food from local farms.

"Some of these challenges are systemic, and no single company or manufacturer can influence an entire supply chain on its own."

For Kaplan, it’s all about harnessing the power of business to make the world healthier, safer, and fairer. Before coming to Haas, he had been communications director at Fight Crime: Invest in Kids California. At the Haas Center for Responsible Business under faculty director Kellie McElhaney, he concentrated on building the business case for social entrepreneurship and corporate responsibility. He was on an MBA team that developed a green-marketing strategy for Fetzer Wines. The results were so good that Fetzer parent Brown-Forman hired Kaplan upon graduation as senior corporate responsibility analyst.

The common thread for Kaplan has been marrying the goals of a for-profit business with broader social objectives.

“This work is ultimately 100 percent about the bottom line,” Kaplan emphasizes. “We are not just doing this for the environment, or for feel-good reasons. We are creating value for our company while also creating value for the environment.”

Kaplan cautions that he often encounters resistance, and that Walmart’s suppliers often worry about changes that will make them less competitive. The answer is to work with the whole constellation of buyers and vendors.

“Some of these challenges are systemic, and no single company or manufacturer can influence an entire supply chain on its own,” Kaplan says. “So how do we help move an entire industry together? If every company in the supply chain is moving at the same pace, then you’re able to raise the tide for all of them.” –Ed Andrews

Unraveling the Complexities of Women in Business

Laura Kray
Warren E. and Carol Spieker Chair in Leadership

Laura Kray

Because Professor Laura Kray grew up in a household where females were the clear majority (5-1 ratio with four daughters), she took for granted that women can achieve anything they want. It wasn’t until later, when Kray began working her way up in the male-dominated world of tenure-track academia, that she realized it’s not that simple.

Building on her many years of trailblazing research and experience as founding faculty director of the Women’s Executive Leadership Program at Haas, Kray now hopes to develop a series of initiatives around women in business as part of the new Institute for Business and Social Impact. Kray has teamed up with Kellie McElhaney, faculty director of the Center for Responsible Business, and Laura Tyson, faculty director of the Institute for Business and Social Impact and co-author of the annual Global Gender Gap Report of the World Economic Forum, to map out an ambitious agenda to be implemented over the next several years that includes research symposia, classes, a speaker series, alumni engagement, and corporate seminars.

“It’s an auspicious time for women’s leadership. We are fortunate to have so many thoughtful women—Sheryl Sandberg, Anne-Marie Slaughter, and Debora Spar—speaking out and writing candidly about their experiences to the top of their professions,” says Kray.

Like those leaders, Kray aims to empower women by having a conversation about gender that encourages them to stay—and excel—in the professional game.

Kray brings her own research to this conversation. In a forthcoming article in Social Psychology and Personality Science, Kray and co-author Jessica Kennedy of Wharton show that women are less comfortable than men with ethical compromise in the name of profits and status.

“As income inequality grows, we need to look closely at what is driving women and men’s career decisions to enter and remain in business, an arena where vast quantities of wealth are generated,” Kray notes.

Kray first became interested in gender issues as a post-doc at Northwestern’s Kellogg School of Management in the late 1990s, a time when gender was drawing little attention in scholarly research, she recalls. Her interest was piqued when a student asked her what role gender plays in negotiations and she didn’t have an empirically sound answer.

So she built on emerging research on “stereotype threat,” in which a person is at risk of confirming a negative stereotype about her own social group—even if she doesn’t believe it to be true. Kray conducted her own research and found that this phenomenon applies to women in negotiations, but it’s not a fait accompli.

“It’s not that women can’t negotiate, but that there are subtle messages suggesting to us that we can’t,” says Kray. “By raising awareness about lingering gender stereotypes in business negotiations, women are licensed to pursue their goals assertively.”

In subsequent research, Kray and two co-authors showed that women underperform when told certain traits associated with men lead to successful negotiations. The trio asked, what if women are told traits typically associated with women lead to successful negotiations? Kray coined a new phrase, “stereotype regeneration,” in which the stereotype for an effective negotiator is regenerated into feminine terms such as “good listener” and “understanding the other side’s emotions.” With those new linkages, women actually outperformed their male counterparts in negotiations.

“The reason why Laura has had such a large impact is that she has gone beyond just saying, ‘men negotiate more effectively than women’ to focus on when and how sex effects appear,” explains co-author Adam Galinsky from Columbia.

“It’s important to recognize that gender differences are not set in stone but are rather quite malleable,” Kray adds. “By conducting research to understand when women are most at risk of being set back by negative stereotypes, we are better poised to create truly innovative organizations that level the playing field.” –Victoria Chang

Inspiring Disruptive Thinking around the Globe

Peter Reiling, MBA 86
Executive Vice President, Leadership and Seminar Programs
The Aspen Institute

Peter Reiling

Through his work in international development, Peter Reiling came to one pivotal realization that would shape his career: Bold, creative, entrepreneurial leadership is essential to making a dent in the planet’s biggest problems.

And so, after spending 35 years living and working overseas doing everything from plowing cotton behind a team of oxen in Togo to helping Nicaraguan farmers supply beans to Peet’s Coffee, Reiling is now dedicated to inspiring entrepreneurs themselves around the globe to give back to society.

“Lots of people are hammering away at the many challenges we face, from education to health care, poverty to environmental degradation,” explains Reiling. “Too few are taking a disruptive approach—thinking of new ways to address classic problems.”

Reiling hopes to change that through his work at The Aspen Institute, based in Washington, D.C. Every year, the institute chooses 20 Henry Crown fellows—entrepreneurial business leaders who have already achieved considerable success—to inspire them to play a broader role in improving their communities, countries, or the world. The fellows—now numbering more than 1,800—include Netflix CEO Reed Hastings; Haas alumnus Patrick Awuah, MBA 99, founder of Ashesi University in Ghana; and Sheila Marcelo, founder of the recently IPO’d Care.com.

“The vision,” Reiling explains, “is to build a highly interactive, ever-growing constellation of forward-thinking, entrepreneurial leaders working separately and together to solve some of the world’s greatest problems.”

With a Belgian mother and German father, Reiling grew up with a love of travel. He attended Georgetown’s School of Foreign Service and then worked in Africa, first in the Peace Corps in Togo and then with USAID in Niger.

After five years, Reiling realized he needed skills in finance, accounting, and marketing for a successful international development career. He chose Berkeley because of its global focus and reputation as a “forward-looking community.” (One bonus: meeting his wife, Denise Byrne, MBA 87.)

"I realized the best way to tackle the sorts of problems developing countries were facing was to organize the local entrepreneurial community and challenge them to come up with creative solutions rather than relying on foreign aid."

After graduation, Reiling worked his way up to CEO at TechnoServe, a nonprofit whose mission was to help build local businesses to create jobs in developing countries. While at TechnoServe Reiling was nominated for The Aspen Institute’s Henry Crown Fellowship, one of a dozen fellowships that he now oversees. Fellows are required to launch a project that stretches their leadership and takes on a problem that others are unable to solve. Reiling’s project: a program in Africa modeled after the Henry Crown Fellowship.

“I realized the best way to tackle the sorts of problems developing countries were facing was to organize the local entrepreneurial community and challenge them to come up with creative solutions rather than relying on foreign aid,” he says.

Reiling created leadership initiatives in Africa and Central America while still at TechnoServe, and then in India, the Middle East, and China after joining The Aspen Institute in 2004.

His most challenging work has been in the Middle East, where he and his staff organized a leadership retreat for 22 entrepreneurs in Jordan in 2009, just months after a serious escalation in Israel-Gaza tensions. “We had to get the Israelis, Palestinians, Jordanians, Lebanese, Egyptians, Kuwaitis, and Saudis in the room to accept that they could learn from one another if they’d only just shed their ‘masks’—something they accepted, building lifelong friendships against all odds.” –Ronna Kelly

Mixing Business and Politics

Ernesto Dal Bó
Faculty Research Director, Center for Nonprofit and Public Leadership

Ernesto Dal Bo

Is corruption through violence different from corruption by bribery? What are the economic and political causes of failed states? Do higher wages attract better public servants? These are just a few of the questions that Associate Professor Ernesto Dal Bó has studied using the prism of an economist. His underlying goal: to shed light on how economic forces shape and are shaped by the health of political and social institutions.

Dal Bó’s research has taken him to remote villages in Mexico, to judges’ chambers in Colombia, and to halls of the U.S. Congress. At the Berkeley-Haas Institute for Business and Social Impact, he is now applying his analytical methods and insights to the cross-sectoral challenges of making societies both more prosperous and more just.

“If you think about corporate social responsibility, social entrepreneurship, and the role of nonprofits, you can trace each of these to some adaptation of society to market and government failures,” he says. “I am a political economist—an economist who looks at economics and politics together. Why is this important? Because governance is at the root of economic development and of all the modalities of private-sector business.”

"American textbooks in economics and politics posit very mild-mannered agents acting within neat institutional settings. This did not match our experience growing up in … Argentina."

After growing up in Buenos Aires under a dictatorship, Dal Bó became convinced that traditional thinking on governance didn’t capture the challenges.

“American textbooks in economics and politics posit very mild-mannered agents acting within neat institutional settings,’’ he says. “This did not match our experience growing up in the politically repressive and economically volatile dictatorship of Argentina in the 1970s and ’80s.”

The standard theories about corruption, for example, assumed that corrupt public officials were privileged decision-makers who auctioned their support to the highest bidders. Dal Bó suspected that coercion and the threat of violence were often as important as bribery, which meant that standard recipes for fighting corruption might prove ineffective.

Dal Bó examined those issues in a series of papers published with his brother, Pedro Dal Bó of Brown University. They have shown that honest reformers are often blocked or driven away by threats of violence. The more violent and corrupt the environment, they found, the lower the quality of public officials was likely to be.

In another study, Dal Bó found that giving senior public officials judicial immunity from prosecution could actually reduce corruption in countries where the judicial systems are weak and interest groups use baseless charges of corruption to block normal governance. (In countries with good judges and courts, he cautioned, immunity from prosecution was likely to increase corruption.)

Dal Bó’s latest research, in Mexico, examined whether higher wages attract better public servants. A considerable literature theorized that higher salaries would attract poorer candidates who cared about money rather than public service. Dal Bó and two colleagues disproved that, studying an experiment in which the Mexican government advertised identical jobs at different wages. Their finding: Higher-wage offers attracted candidates who were better qualified, more motivated, and had higher IQ’s.

As Dal Bó looks into the future, he sees himself as a connector: “I see my work at Berkeley-Haas as connecting groups together and connecting our intellectual tradition to the themes that have occupied me for many years. With the Berkeley Center for Political Economy, our new Institute for Business and Social Impact, and other programs, I think we can shape a stream of high quality students that can go on to change organizations and the world.” –Ed Andrews

From International Banking to Serving Local Youth

Mary Denton, MBA 77
CEO, Sunny Hills Services
San Anselmo, Calif.

Mary Denton

Every day, Mary Denton is reminded of why she left banking for the nonprofit world: At lunch, the 30 or so students of Irene M. Hunt School of Marin stream by her office window on their way to relax and play in the rolling hills of San Anselmo.

The students of all ages suffer from emotional disabilities that prevent them from attending other schools. The teachers at Hunt School not only teach the usual subjects, but also provide a therapeutic environment to help them return to a less restrictive school setting.

“The work we do is transformational,” Denton says. “It changes lives.” Denton is the CEO of Sunny Hills Services, a 118-year-old agency that helps at-risk youth. Besides Hunt School, Sunny Hills runs 15 programs throughout the Bay Area, including a residential program for young adults aging out of the foster care system, a drop-in center for LGBTQ youth, support for family members caring for children when their parents are unable, and mental health treatment for juvenile offenders.

Denton’s move into the nonprofit sector was an abrupt shift from her previous life as a vice president at Bank of America. For 19 years, she lived and worked in New York and abroad, conducting international syndicated lending and investment management. She then worked as a consultant for four years in international banking. Her nonprofit career got its start when she served on the board of Make A Circus, a now-defunct Bay Area summer program that allowed children to create their own traveling circuses.

“I was amazed at what they did with a half-million-dollar budget,” she says. “The program was very empowering for the kids—they had an opportunity to be stars.” She started wondering if there was a way she could use her skills within a service agency and began looking for a job in the nonprofit sector.

Back in 2000, most nonprofits weren’t as focused on financial management as they are now, but Sunny Hills was an exception: Its board wanted a professional with private-sector experience and found it in Denton. She became chief financial officer of Sunny Hills and then CEO in 2010. The job was more challenging than she realized: It involved tightly managing government funds and private donations under complex financing rules. “I thought banks were highly regulated,” she says.

While Denton has been the CEO at Sunny Hills, the budget has grown from $7 million to $10 million. The organization has doubled the number of students at Hunt School, increased housing for youth aging out of foster care from 12 to 50 beds, and expanded a gang prevention program in Sonoma and Marin counties. Sunny Hills hopes to soon open a pilot residential program on its San Anselmo campus for foster youth attending community college.

Denton now oversees 110 employees, most of them social workers, counselors, and special education teachers who serve more than 1,600 young people and 1,000 family members. She constantly uses the core accounting, management, and finance skills she learned at Haas. “Running a nonprofit is running a business,” she says.

Denton also notes that her late Haas professor Dow Votaw always spoke about businesses having a social responsibility toward their communities. Even during her 20 years in banking, she says, she remained aware that she could do good as a businesswoman: “It’s possible to do something that’s not all about the bottom line.” –Mandy Erickson

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