In a 2013 study conducted by the UN Global Compact and Accenture, 40 percent of more than 1,000 chief executives surveyed identified education as one of the top sustainability challenges affecting their core business. A similar study by The Conference Board found that 90 percent of CEOs cite education as a ‘very’ or ‘most’ important precondition for a competitive national economy. The list goes on.
And for good reason – education is the foundation for achieving several of the United Nations Millennium Development Goals. Research has shown that global poverty could be reduced by 12 percent if all students in low-income countries completed school with basic reading skills. Numerous studies have linked education to individual prosperity, better health outcomes, economic growth, and social stability – all essential ingredients for business in terms of operating in a stable environment and accessing a productive, innovative workforce.
More multinational companies than ever before are therefore lining up to support global education. They are collaborating with schools to align curricula with workplace needs; they are partnering with governments, civil society organizations, and multilateral institutions to co-create scalable education solutions; and they are making commitments to multi-stakeholder platforms such as the United Nations Global Education First Initiative, the Global Partnership for Education and the Global Business Coalition for Education – all with the promise of working collectively to address the barriers that prevent children from getting to school and learning.
And yet, a recent paper by UNESCO argues that private sector contributions to education are only $683 million per year, and that business should be making a much larger contribution to funding education worldwide. So what gives? Where’s the disconnect? How can we reconcile the need for more action on education, the reality that companies are more engaged than ever before, and the pleas of the international community for business to do even more?
A recent report by FSG, a non-profit consulting firm specializing in helping firms achieve greater social impact, provides some food for thought; it defines a new model for the private sector in helping to overcome the global education crisis. The authors argue that companies can create ‘shared value’ in education when they “generate economic benefits for their businesses while simultaneously addressing unmet educational needs.” How? By changing the way they do business – redefining supply chain productivity, leveraging core expertise, and innovating and scaling commercially viable solutions that also deliver tangible educational outcomes.
Shared value puts ‘profits’ and ‘returns’ front and center, recognizing them as essential ingredients for companies like Pearson – the world’s largest learning company (and the company I work for) – to impact education at scale. This is not to say that business shouldn’t be ‘giving more’ to education. Companies can and should continue to use CSR or philanthropic funds to support some of the most intractable education challenges, particularly where developing viable business models would not be possible in the short term. But an investment that aligns business interests with social needs and delivers value to shareholders has the potential to be much more sustainable, scalable, and significant in the long term.
When I consider the scope of Pearson’s corporate capabilities and expertise – which include delivering learning products and services across all ages and stages of education, and supporting governments to reform and strengthen their education systems – I’m confident that our contribution can be much more transformative than just writing a check.
That’s why the global education community must think differently about how to harness the unique power of the private sector, and work collaboratively with companies to find what Carol Bellamy (former Executive Director of UNICEF) recognized in her recent “Education for All” blog as the ‘sweet spot’ where business and development strategies overlap. Shared value shifts the conversation away from giving toward investing, which is – after all – what business does best.