Annual Forum 2010 magazine

ESmT
AnnuAl Forum
June 16-17, 2010
Berlin, Germany
ESMT | European School of Management and Technology
ESmT Annual Forum 2010
People, Planet, Profit:
Creating a Sustainable Future
Supported by
Media partners
Special thanks
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Annual Forum 2010
ESMT Annual Forum 2010
People, Planet, Profit: Creating a Sustainable Future
“Corporate responsibility is no longer limited to the single bottom line. Rather we are now facing
the triple bottom line of people, planet, and profit. How to reconcile these three criteria was the
main focus of our 3rd Annual Forum. Just as before, ESMT provided an international platform for
the latest business insight and a critical evaluation of current paradigms to provoke a vital dialog
among leading scholars, business, and public policy leaders.”
The three pillars for sustainable organizational and economic prosperity – people, planet,
and profit – unleashed a powerful debate and rich discussion at the 3rd Annual Forum of
ESMT European School of Management and Technology. True to its mission, the school offered
prominent thought leaders from business, politics, and academia a truly international platform
to discuss solutions for sustainable change.
ESMT President Lars-Hendrik Röller
Held against the backdrop of ongoing global economic
challenges, the 3rd Annual Forum was a logical continuation and extension of the dialog from last year’s
Annual Forum “Navigating in Turbulent Times.” Participants took a collaborative, inter-disciplinary approach
toward innovative solutions from a decidedly European
perspective.
Deepak Chandra, Deputy Dean, Indian School of Business
Zhike Lei, Assistant Professor, ESMT
The first day of the two-day conference was opened by
Michael Diekmann, CEO of Allianz SE, and Chairman of
the ESMT Foundation Board of Trustees. Peter Löscher,
President and CEO of Siemens AG, and member of the
ESMT Foundation Board of Trustees, then delivered
the keynote address, offering his insight on sustainable
business practices. This was followed by a cornerstone
panel moderated by Frederik Pleitgen, Berlin correspondent for CNN, and Henrik Müller, deputy editor-in-chief
for manager magazin. The panel, composed of the
CEOs of Saint-Gobain, Siemens AG, Deutsche Lufthansa
AG, Deutsche Telekom AG, and a senior executive of
OOO Gazprom, engaged in an intense dialog on a sustainable future for Europe.
Later that evening, Infosys founder and chief mentor
N.R. Narayana Murthy received the first ESMT Responsible Leadership Award at the event’s speakers’ dinner.
During his acceptance speech, Murthy acknowledged
the importance of value-driven corporate behavior in
creating sustainable business practices.
Conference participants on their way to reception
Alexander Holst, Senior Manager, Accenture Management Consulting
During the second day of the forum, three individual
discussion panels were led under the rubric of the
triple bottom line: people, planet, and profit. The distinguished set of panelists addressed a wide range of
issues, including sustainability, green energy policy,
business model innovation, and non-zero-sum strategies for greater social value. The group of panelists
uniformly acknowledged that mature Western economies had irreversibly crossed key social, economic, and
political thresholds.
But if the 3rd Annual ESMT Forum was a platform for
new ideas, it was also a validation of the underlying
principles of the social market economy.
It was in this spirit that ESMT President Lars-Hendrik
Röller closed the Annual Forum – with a commitment
to inspire a new generation of entrepreneurial business
leaders who think globally, act responsibly, and respect
the individual. This sentiment was also echoed in the
closing remarks of Alexander Landia, Chairman of the
Board of Directors of Siberian Coal Energy Company,
who said that to achieve sustainability in a world
economy marked by greater global interdependence
and uncertainty, leaders must once again focus on the
fundamentals.
From left to right: Regine Stachelhaus, Member of the Board, E.ON; Andreas Gollan,
Senior Vice President Human Resources, E.ON; Frank Mattern, Director and Managing
Partner Germany, McKinsey & Company, Inc., Member of the ESMT Foundation Board
of Trustees
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First Day
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Creating a Sustainable Future
ESMT President Lars-Hendrik Röller welcomes an audience of 330 who joined ESMT
for its 3rd Annual Forum.
Balancing Risk and Reward for Sustainability
Michael Diekmann, Chairman of the Board, Allianz SE, and Chairman of the ESMT Foundation
Board of Trustees, called on business leaders to take a more holistic approach to profit.
Russia, India, and China. In just a few more decades, we
will not be calling them emerging markets any longer.
They will be full-fledged, fully developed competitors.
They will also consume a growing amount of resources
to support this growth. It will have a major impact on
our global social infrastructure.
regulation. And that is why we need more Europe, not
less, if we want Europe to be a viable partner on the
world scene.
But why would European countries delegate more
power to Brussels? Especially in times when Brussels
is very unpopular with many European citizens? The
first answer is the traditional argument for more European integration. We need better coordination to cope
with externalities like environment, trade, macroeconomic stimulus, and financial regulation.
“People, planet, profit - these are not three separate
concepts. They are a three-part equation for sustainability. People stands for human capital. It is about
fair business and labor practices that benefit all
stakeholders in the communities where companies do
business. But it also is about incentives and moral
hazard. Planet refers to natural capital. It encourages
sustainable environmental practices. And finally, profit
is the economic value created by the organization. Not
just in accounting profits, but the real economic benefit
to society as a whole.
European integration
The EU just passed an unprecedented financial safety
net: 750 billion euros to protect the euro. The Greek
debt crisis has demanded an unprecedented, coordinated effort at the European level. It is requiring greater
cooperation and individual countries to delegate more
power to Brussels. In the end, it shows just how much
Europe needs better crisis prevention, but also crisis
management. It needs better regulation - not more
The second reason why Europe must grow in strength
has to do with domestic politics and the timing of
unpopular decisions.
If policymakers cannot be pro-active at the
European level, they are condemned to being
reactive at the local level. And then it is too late
to do anything except spend taxpayers’ money.
The climate on our planet is also changing. It cannot be
ignored. Climate change will have a social and economic
impact on every industry. New, tough environmental
regulations are just around the corner. Those who take
a wait-and-see attitude run the risk of falling short.
Those who do act will help the environment.
“Eight years ago, the founders of ESMT wanted to
build more than just another business school. Today,
the school is developing into a platform for excellence
in education, fresh thinking, and research for sustainability. It is built on a truly interdisciplinary foundation
of business, academia, and management talent in close
exchange with policymakers in Berlin and Brussels.
The German business education model
Since the late 1940s, Germany’s social market economy
has successfully combined the best of both worlds:
private enterprise and state support. This model has
thrived – even during the current crisis. In a co-ordinated
effort of government, businesses, and unions, the
German job market has been quite resilient and is still
the world's number two exporter after China.
We need to educate future leaders to develop a holistic
view of society: To see the interrelationships between
business and politics; to share a common understanding
of each stakeholder's perspective, and to seek out technology-driven solutions with non-zero-sum outcomes.”
This investment has born fruit. ESMT now ranks amongst
the Top 10 European business schools in the Financial
Times list of executive education open enrollment programs. ESMT research productivity today is - given its
size - comparable to top European schools. ESMT’s advisory role in the political arena is growing steadily – as the
nomination of Professor Röller to the steering committee of the National Platform for Electric Mobility shows.
People approach companies with a different
set of expectations today. They don’t just
expect companies to be good employers.
They expect companies to be good corporate
citizens in the areas in which they operate.
At the same time, today’s companies expect more from
their employees. We need their innovation. Their drive.
For strategy development. For customer loyalty. For business improvement. And for sustainable development.
And of course – and this touches on my final point – we
need them to create healthy, long-term profits. But we
must take a more holistic view of profit. We have to look
at profit in its proper perspective. The financial crisis
made it clear that profit alone does not make a company
healthy. The balance sheet is only one indicator.
People, planet, profit
Our planet only has a finite set of resources. But in the
next century, the demand on those resources will explode exponentially. Take emerging markets like Brazil,
So I think the challenge is pretty clear. Balancing risk and
reward means balancing the interests of people, planet,
and profit. You cannot have one without the other.”
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“I really appreciate that ESMT managed to bring global perspectives together.”
Michael Christ, Head of Corporate Executive Development and LH School of Business, Deutsche Lufthansa
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From left to right
1. Jean-Louis Beffa, Chairman of the Board of Directors, Saint Gobain;
Guillermo Baquero, Assistant Professor, ESMT; Francis de Véricourt, Full
Professor, ESMT 2. Andrey Biryulin, Managing Director, Gazprom Germania; and Hans-Joachim Gornig, Managing Director, Gazprom Germania
3. Peter White, Director Global Sustainability, Procter & Gamble;
Marie-Luise Meinhold, Allianz SE 4. Reception guests 5. Stefan Lauer,
Member of the Executive Board, Deutsche Lufthansa, and Member of the
ESMT Foundation Board of Trustees; Wolfgang Malchow, Member of the
Board of Management, Robert Bosch, and Member of the ESMT Foundation Board of Trustees; Clemens Börsig, Chairman of the Supervisory
Board, Deutsche Bank, and Chairman of the ESMT Supervisory Board
6. Reception 7. Pierre-Christian Fink, Die Zeit; Stefan Reichelstein,
William R. Timken Professor of Accounting, Stanford Graduate School of
Business, and Member of the ESMT Academic Board; Deepak Chandra,
Deputy Dean, Indian School of Business
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Sustainable Technology and a Pioneering Spirit
Peter Löscher, President and CEO of Siemens AG, and Member of the ESMT Foundation Board
of Trustees, in his keynote address before the 3rd ESMT Annual Forum, noted the challenges for
countries, organizations, and individuals over the coming decade. Encouraging business leaders to adopt a pioneering spirit, he said that the deployment of sustainable technologies was
the way forward to achieving tangible progress.
“It's been very energizing and inspirational to realize that people who are in charge of
management education are taking sustainability really seriously.”
“It happened just weeks ago: President Barack Obama
was the first U.S. president to visit a Siemens factory
and he made two things very clear. First: in a time of
crisis, we have to bet on the future. We should not
drop our heads. Instead, we should rise to meet these
challenges. And second: if we want to create a sustainable future, we have to blaze a trail. We have to revive
the pioneering spirit!
one of the largest offshore wind parks in the world. It
could be supplying enough power for up to 750,000
homes. That’s about one quarter of the homes in the
Greater London area. And London Array will reduce CO2
emissions by 1.9 million tons per year.
Right now, we're still recovering from global economic
crisis. The economies of a number of countries, such as
BRIC and Middle East, have been on a growth pattern
for some time. European countries have been slower in
returning to growth. While the outlook for exportdriven economies has become more positive, a number
of countries are still struggling with large government
deficits, which threaten the stability of the euro. As a
result, many European countries have been forced to
reduce public spending.
We have to find answers to the world’s
toughest questions
Global socio-economic trends such as demographic
change, urbanization, and climate change – they all
raise tough questions. For example:
How can we provide affordable, high-quality
healthcare to increasing numbers of elderly
people? How can cities expand their infrastructures, improve living conditions – and at
the same time, save costs and resources?
How can we meet the rapidly rising energy
demand worldwide, and at the same time,
reduce CO2 emissions?
Technological innovations are the strongest
levers to reduce greenhouse gas emissions
The central question is: How can we act more sustainably? From my point of view, sustainable action has to
encompass three dimensions: it has to protect our
environment and conserve natural resources, that's our
planet. At the same time, it has to support our economic activities. That's profit. And it has to improve
quality of life, that's the people dimension.
Ross Geraghty, TopMBA Career Guide
These two examples show what’s possible if we join
forces and shape the environment we live in. They
show that technology provides the answers to the
toughest questions of our time. And that these answers are already available today.
Our environmental portfolio is a significant
growth driver
The battle against global warming will be
decided in cities
Today, more than half of the world’s population lives
in cities. By mid-century, it will be almost two thirds.
And cities already account for 75 percent of global
energy consumption and for 80 percent of greenhouse
gas emissions!
The prospects for dynamic ‘green growth’ look good.
The global market for environmental technologies is
forecast to grow by 6.5 percent per year. During the
next ten years, market volume is expected to double
to more than 3 trillion euros. That’s great news for
green technology companies. However, to be able to
achieve this profitable growth, companies have to be
As the European Green City Index shows, some European
cities have been very successful in making their infrastructures sustainable. Two examples, how inventive
cities can be in creating sustainable infrastructures:
Example number 1 is just outside Berlin. Germany’s
capital has renovated more than 170 public buildings
during the last years, installing efficient heating, air
conditioning, water, and lighting technologies. These
new technologies now save 36,000 tons of CO2 per
year. There's another benefit: Berlin does not pay for
the retrofitting. Rather, the new technologies pay for
themselves – through energy cost savings of around
6 million euros per year.
Example number 2 is London. Britain’s capital has ambitious CO2 reduction targets. Its Climate Change Adaptation Strategy aims to reduce emissions by 60 percent
during the next fifteen years, compared to 1990 levels.
A key lever in achieving these targets will be wind
power. In the Thames estuary, London’s authorities
have started to build the London Array offshore windpark. When completed in 2012, London Array will be
Audience during Cornerstone Panel
No. 1 or 2 in the market. You have to be a market and
technology leader.
The question is: How long will you maintain this leadership position? There are many other players who
strive for exactly the same. The future race for green
leadership will be tough.
Our employees are the backbone of our success
Siemens is a sustainable company – we have survived
and thrived for 163 years. And we will continue to do
so. Our employees are the backbone of this success.
We currently have more than 400,000 employees in
approximately 190 countries across the globe. About
100,000 hold green jobs. About 90,000 are engineers
or scientists. About 30,000 work in R&D. Last fiscal
year, our people came up with 7,700 inventions, that’s
32 inventions per working day. We currently hold
56,000 patents, about 16,000 of them for green technologies. That’s the result of hard work. But the people
of Siemens make it possible. They blaze the trail.”
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Seeking a Balanced Energy Policy
Sergej Komlev, Head of Contract Structuring and Price Formation, 000 Gazprom export, posed
a series of poignant questions at this year’s ESMT Annual Forum and challenged assumptions
regarding Europe’s evolving energy policy.
“The pursuit of renewable energy sources is
both beneficial and desirable, but it is not a
short-term solution. Europe should continue to
consider using existing resources while subsidizing new energy research.”
In his address before the 3rd ESMT Annual Forum, Sergej
Komlev said that gas has a compelling story to tell. It
not only offers an adequate, secure energy supply
that addresses European needs, but it also plays an
important role in helping individual EU countries
achieve their carbon reduction goals.
Komlev said that while recommendations at the EU
level for capital investment in smart energy grids will
undoubtedly offer long-term benefits, they will not
address Europe’s energy security concerns in the short
term. “Europe must decide where it wants to channel
its investments so that it can provide energy while
maintaining growth and jobs. We cannot make the sun
glow or the wind blow. But with gas, we can make the
turbines roll for competitively priced electric power.”
Disagreeing with those who argue that natural gas
should accept its declining role in a carbonless future,
Komlev argued that gas should indeed be included in
any balanced energy solution. “Natural gas has an
important role to play in Europe’s future energy
mix,” he said.
In closing, Komlev said that one of the key areas that
Gazprom is currently exploring is shale gas. More abundant than even coal, it can be produced at a capacity
that adequately meets Europe’s energy security needs.
“If the environmental questions for shale natural gas
can be addressed, we believe that it shows great promise for both energy and job creation,” he said. “Natural
gas can become an important part of energy production. And it will be a critically important resource as
long as markets remain balanced and in tune with
market signals.”
ESMT MBA students
ESMT MBA students
Shirish Pandit, Program Director, ESMT
Audience in ESMT Auditorium Maximum
Raji Jayamaran, Assistant Professor, ESMT
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European Thought Leadership for the Long Term
The ESMT Responsible Leadership Award 2010
At the ESMT Annual Forum Cornerstone Panel, a distinguished group of CEOs offered their vision
for European sustainability on a broad range of issues, including labor relations, CO2 reduction,
regulation, energy policy, and innovation. Their individual positions built a remarkably strong,
shared consensus around the need for sustainable actions that benefit all of society’s stakeholders.
On the occasion of the ESMT Annual Forum 2010, the ESMT Responsible Leadership Award
was presented for the first time. The recipient was N.R. Narayana Murthy, Chairman of the
Board and Chief Mentor, Infosys Technologies Ltd. The laudation was held by Manfred Kets
de Vries, Distinguished Professor, ESMT, and Raoul de Vitry d’Avaucourt Chaired Clinical
Professor of Leadership Development, INSEAD.
The ongoing European debt crisis raised central questions about the collective resolve of the EU’s individual
members. But at the ESMT Annual Forum Cornerstone
Panel, the leaders of some of the Continent’s largest
companies painted a positive, confident picture of
Europe – of a region and people capable of driving a
sustainability agenda across a number of key areas.
Implementing smart regulation
“When I was asked by Lars-Henrik Röller to give the
laudation for Mr. Murthy, I jumped at the opportunity.
As a professor who has been running a CEO recycling
seminar for almost 20 years, I sincerely believe that Mr.
Murthy is a giant of a role model for most leaders.
Wolfgang Mayrhuber noted that a great deal of progress could also be made with the implementation of
existing technologies. “We have a massive opportunity
to tackle this impact,” he said. “This isn’t a matter of
making a tradeoff between profits and the environment. There are ample opportunities in which doing
the right thing can also help the environment and all
other stakeholders.”
Due to Mr. Murthy’s leadership, Infosys holds specific
values such as hard work, ethical practices, and living up
to commitments in high regard. To create trust in leadership, Mr. Murthy has been an advocate of simple living,
human decency, respect, and fairness. He has always
been strongly committed to creating something worthy,
exemplary, and honorable. He truly has walked that talk!
Appearing before a packed audience were Jean-Louis
Beffa, Chairman of the Board of Directors, Saint-Gobain;
Peter Löscher, President and CEO, Siemens AG, and
Member of the ESMT Foundation Board of Trustees;
Wolfgang Mayrhuber, Chairman and CEO, Deutsche
Lufthansa AG; René Obermann, CEO, Deutsche Telekom
AG; and Sergej Komlev, Head of Contract Structuring
and Price Formation, 000 Gazprom export. The discussion was moderated by CNN Berlin correspondent
Frederik Pleitgen and manager magazin deputy editorin-chief Henrik Müller.
Achieving a sustainable balance
Supporting a social market model, Beffa advocated
securing shareholder commitment toward planning for
the long term, investing in technology for greater
competitiveness and economic growth, and fostering
harmonious labor relations for greater social equity
and cohesion.
He saw a greater need for global coordination on CO2
reduction to ensure that European economies maintain
their competitive edge. Citing a parallel competitiveness
agenda, Löscher indicated that Europe cannot afford
to lose energy-intensive industries to other parts of
the world.
Building Europe’s strategic energy mix
Balancing Europe’s energy needs with sustainable
renewable energy sources was highlighted in the
discussions. Komlev said that natural gas has an important role to play in Europe’s future energy mix. And
while the pursuit of renewable energy sources is
both beneficial and desirable, it is not a short-term
solution.
number of awards and honors. Just to give you a few
examples: in 2008, he was given the Padma Vibhushan
award, the second highest civilian award in India. He
was also awarded the Légion d'Honneur, the highest
civilian award given by France, and has become Commander of the British Empire. Furthermore, Mr. Murthy
also holds over 26 honorary doctorates from universities across the world.
Mr. Murthy, we are all grateful for your talent in putting a modicum of sanity into a sometimes crazy
world! You are a role model to all of us. As the writer
Henry Miller once said, ‘Example moves the world
more than doctrine.’ Thank you for being here!”
Given the culture of trust at Infosys, it is no wonder
that Mr. Murthy has been the recipient of an incredible
Driving innovation through sustainability
Citing a need for policies that promote European innovation, including stronger intellectual property legal
standards at the EU level, René Oberman said that
Europe should act in a much more unified way. He also
indicated that innovation in the area of green technology can serve the dual function of boosting regional
economies while protecting the environment.
Cornerstone Panel, from left to right: Henrik Müller, Deputy Editor-in-Chief, manager magazin; Sergej Komlev, Head of Contract Structuring and Price Formation, 000 Gazprom export; Wolfgang Mayrhuber, Chairman and Chief Executive Officer, Deutsche Lufthansa; René Obermann, Chief Executive Officer, Deutsche
Telekom; Peter Löscher, President and Chief Executive Officer, Siemens, and Member of the ESMT Foundation Board of Trustees; Jean-Louis Beffa, Chairman of
the Board of Directors, Saint-Gobain; Frederik Pleitgen, Berlin Correspondent, CNN
From left to right: Lars-Hendrik Röller, President, ESMT; Manfred Kets de Vries, Distinguished Professor, ESMT, and Raoul de Vitry d’Avaucourt Chaired Clinical
Professor of Leadership Development, INSEAD; N.R. Narayana Murthy, Chairman of the Board and Chief Mentor, Infosys Technologies; Clemens Börsig, Chairman
of the Supervisory Board, Deutsche Bank, and Chairman of the ESMT Supervisory Board
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Respect for All Stakeholders
In his acceptance speech for the first ESMT Responsible Leadership Award, Infosys
founder N.R. Narayana Murthy said that respect and profits go hand in hand.
“Our assets walk out of the door each evening. We have to make sure that they come back
the next morning.”
N.R. Narayana Murthy
From left to right
1. Rajeev Gowda M V, Professor of Economics and Social Sciences,
Indian Institute of Management 2. Guido Bohsem, Süddeutsche
Zeitung; Jörg Rocholl, Full Professor and Ernst & Young Chair in
Governance and Compliance, ESMT 3. Ludwig Koll, Managing
Director, Ferrero Deutschland 4. Marina Landia, Audiovisual Artist;
and Wulff Plinke, Dean, ESMT
in Mumbai as they laid the groundwork for the firm
years ago. Their collective goals were very ambitious.
Some partners wanted to build Infosys into the company
with the highest market capitalization in India. Other
partners sought to make the firm the country’s most
profitable. Taking a contrarian view, Murthy encouraged his partners to rethink both strategies by striving
to do something completely different: become the most
respected company in India.
Infosys founder and chief mentor N.R. Narayana Murthy
was the first recipient of the ESMT Responsible Leadership Award. During his acceptance speech at the
gala dinner at the end of the first day of the Annual
Forum, Murthy acknowledged the importance of valuedriven corporate behavior in creating sustainable
business models.
By achieving the respect and admiration of its stakeholders, Infosys has indeed gone on to achieve the
other two goals. In sharing his own personal story,
Murthy underscored the direct relationship between
a company’s respect for its stakeholders and its future
long-term business success.
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“If you respect people, employees, customers,
citizens, shareholders, and bureaucrats, you
will create shared value. When you do that,
profits will automatically follow.”
Mr. Murthy recounted the early discussions that he and
his fellow Infosys co-founders had in his small apartment
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From left to right: Wolfgang Malchow, Member of the Board of Management, Robert Bosch, and Member of the ESMT Foundation Board of Trustees; Georg Graf
Waldersee, Managing Partner, Germany, Switzerland, and Austria, Ernst & Young
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A Strong Environmental Record
The second day of the 3rd ESMT Annual Forum opened with a conference breakfast and
speech by Girish S. Paranjpe, Jt CEO, IT Business and Member of the Board of Wipro
Limited. The discussion was moderated by ESMT Professor C.B. Bhattacharya.
Achieving Inclusive Growth
Celebrated Columbia University Professor and Economist Jagdish N. Bhagwati delivered the keynote address on the second and final day of the ESMT Annual Forum. He argued for the implementation of micro-incentives to encourage people at all levels of society toward sustainable action.
“Economists like to have systems of either incentives
or disincentives that either reward or punish specific
behavior,” explained Bhagwati. “At the end of the
day, this is how we can get people at the individual
level to respond.”
issues. That’s when we decided to turn the whole
problem on its head.”
By pursuing a potent mix of technical innovation and
creativity with environmental sustainability, Wipro has
quickly become a global thought leader in the area of
corporate social responsibility. As part of its drive towards environmental preservation, Wipro has launched
EcoEye – the company’s corporation-wide initiative to
transform the way they do business and engage all
their stakeholders.
Wipro’s journey to become one of the world’s largest IT
services companies represents a strong record of business achievement – and an equally strong environmental
record. Paranjpe related an experience at the company
four years ago when, during a shareholder’s meeting,
demonstrators protested the company’s manufacturing
practices for a line of personal computers.
“We took two valuable lessons from that incident,”
said Paranjpe. “We realized that philosophically this
was a very important issue. And we also realized that
technology was a big option in addressing sustainability
Q&A session at conference breakfast
In addition to creating new business models and products based on green technology, the company has implemented an impressive array of policies across its offices
worldwide to reduce energy and water consumption.
Greenpeace, in its most recent annual “Guide to
Greener Electronics,” ranks Wipro as India's number
one green brand and as one of the top five green
brands in the world.
In closing, Paranjpe said, “We think sustainability is a
great idea, not only for organizations to save costs
and become more efficient, but also to create a better
future for themselves and their stakeholders.”
Bhagwati said that policies like a carbon tax would go
a long way in encouraging citizens and societies to
pursue sustainable alternatives. He then extended that
argument to trade. Countering critics of globalization,
Bhagwati cited the economic miracles of emerging
markets like China and India, where growing economies,
fueled by foreign trade, have improved millions of lives
with the opportunity for wealth creation and prosperity.
Addressing the issue of micro-incentives and environmental sustainability, Bhagwati discussed the importance of creating incentives to encourage people to
engage in more environmentally friendly behavior.
“In the area of sustainability, like economics,
there is always slack in the system. There is
always a potential output which has not been
reached. All we have to do is look at our own
behavior.”
Offering an example from the business world, Bhagwati
said that the actions of progressive firms like Wipro offer a powerful illustration of how to do well by creating
incentives to do good. Rather than investing additional
resources, Wipro simply identified concrete opportunities to save energy and conserve natural resources.
“Structurally, the world’s global economy today is very
different. And that is the best hope we have in attacking
poverty and in transforming the lives of people so they
can have greater opportunity.”
Bhagwati also noted that the current economic recovery
has been buoyed by world governments’ almost total
abandonment of protectionist measures, a practice
that has damaged growth and recovery in the past. He
indicated that free trade would continue to be a critical
element in creating sustainable wealth, healthy economies, and inclusive growth in the future.
In light of the need for future growth, Bhagwati reminded the audience that all of the progress in corporate
social responsibility would be futile without actually
achieving tangible profits. “You have to have profit
before you can actually do CSR,” he said.
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Panel I - People: Leading for Sustainability
Thought leaders explore the impact of talent development on organizational sustainability.
Panel II - Planet: Green Energy Future –
Hopes and Realities
Experts examine decision making frameworks for sustainable energy solutions.
ESMT professors Konstantin Korotov and Zhike Lei
moderated a panel of distinguished experts to discuss
the sustainable development of talent in organizations.
The group included Andrew Dyckhoff, Merryck & Co.
Ltd.; Jonathan Gosling, University of Exeter; Manfred
Kets de Vries, INSEAD and ESMT; Charles O’Reilly, Stanford University; Catherine Tinsley, Georgetown University; and Mary Uhl-Bien, University of Nebraska-Lincoln.
Konstantin Korotov, ESMT Associate Professor
Zhike Lei, ESMT Assistant Professor
Charles O’Reilly, Frank E. Buck Professor of Management, Hank
McKinnell Pfizer Inc. Director of the Center for Leadership
Research, Stanford Graduate School of Business
Panelists explored the implications of leaders’ behavior
on the sustainability of organizations under the conditions of increasing complexity and interdependency.
Panelists and the audience discussed how to transform
workplaces into environments in which employee potential can be developed and unleashed, where long-term
thinking takes precedence over short-term objectives,
and costly mistakes are avoided through the creation
of environments in which people have the psychological
safety necessary for learning.
The dialog ended with a focused discussion on the relationship between leadership and the human side of
sustainability. The panelists concluded that as sustainability issues touch every function, business line, and
every employee, a clear sustainability vision is a corporate prerequisite, together with the capabilities to
overcome inertia and actively initiate the necessary
corporate change processes. For example, people who
experience near-misses – that is, an event with a reasonable expectation of failure that ended in success due
to random good luck – often associate potential hazard
with feelings of safety and success. So they tend to
discount the gravity of downside consequences and
make riskier decisions in face of future hazard warnings.
Catherine Tinsley, Executive Director Women’s Leadership Initative and Associate Professor, McDonough School of Business, Georgetown University
A panel, moderated by ESMT faculty professional
Christoph Burger, brought together a distinguished
group of panelists that included Carlos J. Härtel, GE
Global Research; Mel Horwitch, New York University;
Matthias Kopp, World Wide Fund For Nature (WWF);
Georg Meran, Technische Universität Berlin; Eckhardt
Rümmler, E.ON AG; and Alexander Voigt, Younicos AG.
Christoph Burger, Faculty Professional, ESMT
Panelists discussed the future of sustainability in light
of the lack of a comprehensive agreement at the 2009
United Nations Climate Change Conference in Copenhagen. They focused on the responsibilities of stakeholders
and suppliers. At the same time, they explored the role
of micro-incentives in achieving potential political solutions for a low-carbon economy, both from a European
and a U.S. perspective.
Finally, panelists engaged in a discussion on how energy
companies can and should pursue different strategies
to secure current market share.
At the conclusion of the discussion, panel participants
completed a questionnaire. The results revealed strong
support for the idea that economic growth, employment,
and renewable energies need to be tied into a single,
sustainable concept. Similarly, participants asserted that
industrial organizations of all sizes, including political,
NGO, and research institutions, must contribute to a
greener future – not as separate entities, but within the
context of an integrated, collective effort.
Discussion during coffee break
From left to right: Matthias Kopp, Project Manager, World Wide Fund For Nature; Georg Meran, Dean of Graduate Studies, Technische Universität Berlin; Mel
Horwitch, Professor of Technology Management, New York University; Eckhardt Rümmler, Senior Vice President Upstream/Generation, E.ON; Carlos J. Härtel,
Managing Director, GE Global Research; Alexander Voigt, CEO, Younicos
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Annual Forum 2010
Annual Forum 2010
Panel III - Profit: Doing Well with Doing Good
Returning to Fundamentals
A prominent group of panelists calls for a paradigm shift in the way corporate performance
is measured
In his closing address on the final day of the ESMT Annual Forum, Alexander Landia, Chairman
of the Board of Directors of Siberian Coal Energy Company, told audiences that to achieve sustainable business practices, senior managers must once again embrace fundamentals.
Moderated by ESMT professor C.B. Bhattacharya, the
prominent group of panelists included Erik Brandsma,
E.ON AG; Rajeev Gowda M V, Indian Institute of Management; Alexander Holst, Accenture Management
Consulting; Belén Izquierdo, Telefónica SA; Jonathan
Rosenthal, The Economist; and Peter White, Procter
& Gamble.
C.B. Bhattacharya, ESMT Full Professor and E.ON
Chair in Corporate Responsibility
Simon Wakeman, Associate Professor, ESMT
Panel discussion
The group explored how companies can earn profits
while addressing the needs of all societal stakeholders
– not only the needs of shareholders. Countering the
idea that corporate responsibility (CR) is a zero-sum
game or only generates costs, participants accepted
the notion that “doing well by doing good” is a sustainable paradigm from both sides of the equation –
as long as neither business nor social outcomes are
neglected. They then discussed a number of initiatives
that companies can formulate and implement to create
greater business and social value. Integrating sustainability into the core strategy of a company is key.
Therefore, visionary leaders are needed to guide their
companies towards a sustainable future. Additionally,
co-created initiatives with employees have the potential to make CR a part of companies’ DNA from a bottom-up perspective.
Panelists then conducted an even more rigorous examination of the very notion of profit. The group posited
several avenues by which the business community can
begin the transition from a single to a triple bottom
line focus, e.g., related to responsible pricing and lobbying for smart regulation. The group agreed that
when companies judge their performance by profitability as well as social and environmental performance,
sustainable results will follow. Whether the notion of
profit and GDP are sufficient measures or if additional
instruments (e.g., Gross Domestic Happiness Index)
should be added, was discussed controversially. One
intriguing suggestion was to add a fourth P to the triple
bottom line of people, planet and profit: purpose.
“In an increasingly volatile business world, managers
must think more fundamentally about economics,” said
Landia. “We need to be in an environment with competing ideas, but we can never forget the fundamentals.”
ing the absence of crisis. Indeed – we will have to
continue to perform in spite of crisis. We once had an
economic crisis every 10 years. Now we can probably
expect to have one every two years or less.”
Optimistic on the future of both countries and markets, Landia expressed confidence that the world
would continue to make new intellectual and economic
achievements in spite of an increasingly volatile global
market. He stressed the crucial role that business
schools like ESMT can and should play in fostering
future sustainability.
At the same time, Landia reminded the audience that
businesses and governments cannot neglect sound
business principles and profits. Profit is, after all, the
fuel that creates jobs, ensures prosperity, and that provides the critical funding for necessary social programs.
“We need to remind ourselves that the German model
is the social market economy,” he said. “We need to
remember that the word ‘market’ is still there.”
“We should not be pessimistic,” said Landia. “The world
will, indeed, move on. We will develop new technologies;
new ways of thinking; new ways of looking at old problems. We will develop new kinds of achievements. We
will grow – both intellectually and economically. But we
have to realize that today we live in a very different
world; a world that is characterized by a much greater
amount of volatility. And volatility will continue to be
even greater in the months and years to come. We
must learn to continue to perform in this kind of challenging environment. That is because we will not be
able to achieve any of these worthy goals while assum-
Landia praised ESMT’s actions in the areas of business
education and in consensus building across a broad
range of industries through the efforts of its 25 founding organizations. “ESMT is doing exactly the kind of job
that a leading, international business school should be
doing. It is inspiring a new generation of entrepreneurial
business leaders who think globally, act responsibly, and
respect the individual. This is the way forward. This is
how we can help ourselves – both as individuals and as
companies – to prevent future crises in the coming
years. This is how we can achieve sustainability.”
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Annual Forum 2010
Annual Forum 2010
Creating an International Platform for
Sustainability
In his closing remarks at the 3rd ESMT Annual Forum, ESMT President Lars-Hendrik
Röller reinforced the school’s commitment to build business leaders who embrace
sustainable business practices.
ESMT President Lars-Hendrik Röller closed the 3rd Annual
Forum by reflecting on the significant contributions the
distinguished group of international experts provided
throughout the event.
For the years to come, the ESMT Annual Forum will continue to serve as a common platform, he said, where
current perspectives of economic, political, and social
contexts will be openly discussed, cross-referenced, and
assessed as to their sustainable prospects. Attendees
will be able to take stock of contemporary ESMT research and establish a network of scholars and practitioners interested in working towards the goals which
brings them together each year at ESMT.
Companies and institutions represented:
Allianz · The Boston Consulting Group · BMW · Columbia University
Daimler · Danone · Deutsche Bank · Deutsche Lufthansa · The Economist
E.ON · Ernst & Young · Gallup · Gazprom · GE · Harvard Business Manager
Hitachi · Infosys · INSEAD · Lomonosov Moscow State University · Max Planck
Institute · McDonald’s · McKinsey & Co. · New York University · Otto Group
Pfizer · Procter & Gamble · Siberian Coal Energy Company · Siemens
Stanford University · Telefónica · ThyssenKrupp · Transparency International
Volkswagen · The Wall Street Journal · WWF · Younicos · Die Zeit
BBQ lunch in ESMT garden
23
24
Annual Forum 2010
Annual Forum 2010
Program Overview
Wednesday, June 16
4:30 p.m.
moderators:
Introduction
lars-Hendrik röller
President, ESMT
4:40 p.m.
Henrik müller
Deputy Editor-in-Chief,
manager magazin
Andrew Dyckhoff
Chief Executive Officer EMEA, Merryck & Co. Ltd
Frederik Pleitgen
Berlin Correspondent, CNN
Jonathan Gosling
Director of the Center for Leadership Studies, University of Exeter
6:45 p.m.
manfred Kets de Vries
Distinguished Professor, ESMT, and the Raoul de Vitry d’Avaucourt Chaired Clinical
Professor of Leadership Development, INSEAD
Evening program
Reception with art installation by
marina landia, audiovisual artist
Keynote Address
Peter löscher
President and Chief Executive Officer,
Siemens AG, and Member of the ESMT
Foundation Board of Trustees
5:10 p.m.
Panel I – People: leading for Sustainability
opening of ESmT Annual Forum
michael Diekmann
Chairman of the Board of Management,
Allianz SE, and Chairman of ESMT
Foundation Board of Trustees
4:50 p.m.
10:00 a.m.
Thursday, June 17
8:00 a.m.
Cornerstone Panel
“The new role of the State and European
Competitiveness”
Breakfast with Presentation and Q&A
“Creating a 21st Century Sustainable Enterprise - from what now to what next?”
moderator:
Sergej Komlev
Head of Contract Structuring and Price
Formation, 000 Gazprom export
Wolfgang mayrhuber
Chairman and Chief Executive Officer,
Deutsche Lufthansa AG
rené obermann
Chief Executive Officer,
Deutsche Telekom AG
Catherine Tinsley
Executive Director Women’s Leadership Initiative and Associate Professor, McDonough School
of Business, Georgetown University
Girish S. Paranjpe
Jt. CEO, IT Business, Member of the
Board, Wipro Limited
Jean-louis Beffa
Chairman of the Board of Directors,
Saint-Gobain
Peter löscher
President and Chief Executive Officer,
Siemens AG, and Member of the ESMT
Foundation Board of Trustees
Charles o’reilly
Frank E. Buck Professor of Management, Hank McKinnell Pfizer Inc. Director of the
Center for Leadership Development and Research, Stanford Graduate School of Business
C.B. Bhattacharya
Full Professor and E.ON Chair in
Corporate Responsibility, ESMT
9:00 a.m.
Introductory remarks
lars-Hendrik röller
President, ESMT
9:10 a.m.
Keynote Address
Jagdish n. Bhagwati
Professor, Columbia University
mary uhl-Bien
Howard Hawks Chair in Business Ethics and Leadership Associate, Director, Global
Leadership Institute, University of Nebraska-Lincoln
moderators:
Konstantin Korotov
Associate Professor, ESMT
Zhike lei
Assistant Professor, ESMT
25
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Annual Forum 2010
Annual Forum 2010
Program Overview
10:00 a.m.
Panel II – Planet: Green Energy Future – Hopes and realities
10:00 a.m.
Panel III – Profit: Doing Well With Doing Good
Carlos J. Härtel
Managing Director Europe, GE Global Research
Erik Brandsma
Vice President Corporate Responsibility, E.ON AG
mel Horwitch
Professor of Technology Management and Director of the Institute for Technology and
Enterprise Polytechnic Institute, New York University
rajeev Gowda m V
Professor of Economics and Social Sciences, Indian Institute of Management Bangalore
matthias Kopp
Project Manager Finance and Climate, World Wide Fund For Nature (WWF)
Alexander Holst
Senior Manager, Accenture Management Consulting
Georg meran
Vice-President, German Institute for Economic Research (DIW), Dean of Graduate Studies,
Technische Universität Berlin
Belén Izquierdo
Head of Corporate Responsibility, Telefónica SA
Eckhardt rümmler
Senior Vice President Upstream/Generation, E.ON AG
Jonathan rosenthal
European Finance and Business Correspondent, The Economist
Alexander Voigt
Chief Executive Officer, Younicos AG
Peter White
Director Global Sustainability, Procter & Gamble
moderator:
moderator:
Christoph Burger
Faculty Professional, ESMT
C.B. Bhattacharya
Full Professor and E.ON Chair in Corporate Responsibility, ESMT
12:45 p.m.
Presentation and Discussion of Panel results
Panel moderators
1:00 p.m.
Closing Address
Alexander landia
Chairman of the Board of Directors, Siberian Coal Energy Company
1:20 p.m.
Closing remarks
lars-Hendrik röller
ESMT President
1:30 p.m.
lunch BBQ
27
Founders and Benefactors of ESMT
Original (Find from our FTP)
Recreated PMS
The mission of ESMT
Original (from our ftp)
http://www.eads.com/
ESMT develops entrepreneurial leaders
who think globally, act responsibly and
respect the individual.
Modify PMS
With a heritage rooted in European
values and the potential of technology,
ESMT develops and imparts new
knowledge to foster sustainable
economic growth.
ESMT. The business school founded by business.
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