Convincing the corporate world that quality education is important for business, too, is crucial for encouraging corporate involvement, as Vanina Farber points out. She explains why quality education is relevant for the long-term sustainability of a business, and why making evidence-based educational solutions available to everyone will help push the agenda forward.
Zoe Bozzolan-Kenworthy: Most countries have increased access to education. But inclusive, equitable, quality education, as outlined in Sustainable Development Goal 4 (SDG 4), has not been achieved. According to UNESCO, there is an annual funding gap of USD 39 billion. Working together, can we still hope to reach this goal by 2030?
Vanina Farber: There is still hope, and we should do everything in our power to achieve that goal. It will be a tough challenge, however, and diverse sectors will need to join forces in that effort. Improving quality education is not something you can do on your own: You need collaboration to build sustainable, long-term projects that align with the incentives of different players.
Partnerships with governments, NGOs and the private sector are crucial, but that approach makes these interventions more complicated from a governance perspective. Trust is also critical, but creating trust is not always easy. Still, there is no getting around the need to build comprehensive multi-sector alliances in the education sector.
“There is no getting around the need to build comprehensive multi-sector alliances in the education sector.”
ZB: Does the shift in focus from quantity to quality of education, as specified in SDG 4, make the goal more difficult to achieve because quality is not easily measured?
VF: Quantifiable targets are essential—you need to know what impact you are achieving. It is crucial to focus on a set of environmental, social and governance (ESG) issues that can have a large impact on financial performance. This helps the corporate world understand which ESG issues matter the most, so that corporate priorities can be aligned with stakeholder engagement. The Global Reporting Initiative has developed an interesting framework for achieving this.
Sometimes it is difficult to come up with these measures because of subtle differences between output, outcome and real impact. For example, building 10 schools, training 100 teachers and distributing 1,000 textbooks are outputs that may not affect the quality of education. Having books, teachers or even infrastructure does not automatically lead to the eradication of child labor, which is a material issue for many corporations worried about building sustainable value chains. An evidence base is needed to ensure that interventions achieve the desired impact.
“Building 10 schools, training 100 teachers and distributing 1,000 textbooks are outputs that may not affect the quality of education.”
ZB: Why is the business sector doing so little to support education, despite widespread agreement that education is the most powerful way to invest in our future?
VF: There is a consensus that private capital is playing an increasingly important role in achieving the Sustainable Development goals, but in the case of SDG 4 there are some very specific challenges, which also touch on philosophical issues. In some cases, questions are raised about whether we really want private corporations, large businesses or even private capital influencing educational curricula. Isn’t this, traditionally, the role of the government?
However, although governments across the world have agreed to adopt the Education 2030 Framework for Action (FFA) and spend 4 to 6 percent of GDP on quality education, this commitment has not yet been followed by action. So an investor might ask herself, “Should we get involved? Are we a legitimate player in the education arena, or should we stay away?” I think this is a particularly valid philosophical concern.
Second, on a more practical level, companies may prefer to focus their sustainability strategies on issues that are material to their core businesses. If corporations are to engage with and lead initiatives, they need a broad understanding of how quality education affects their business opportunities.
For example, a corporation may realize that avoiding child labor in its value chain (e.g. cocoa, coffee or tobacco) is a central issue, but it is a big step to move from that realization to investing in education. Alternative solutions, such as interventions targeting parents or farmers, may also prevent child labor, while encountering fewer roadblocks. More work is needed to demonstrate how quality education is relevant to what private companies do.
“More work is needed to demonstrate how quality education is relevant to what private companies do.”
ZB: As private companies weigh investments in quality education, what barriers need to be overcome?
VF: The issue of measurement is important; companies need to have an appropriate measure of what they want to achieve, how (and how much) money is spent and what kinds of impacts and returns on investment can be generated. Therefore, more research and analysis of impacts are required.
Second, educational interventions are quite costly and difficult to scale up quickly. They are very labor-intensive projects that usually require new infrastructure, technology, additional teachers and more training materials. It takes time to learn what works and even more time to have an impact.
Also, companies want to know whether these interventions will become self-sustaining in the future. The intention is to create something long-lasting that does not depend on grants or the continuous injection of funds year after year.
Last but not least, there are attribution problems. Businesses often want to “own” the impact that is achieved, but it is really hard to isolate and accurately estimate the unique contribution of a business intervention or to establish causality between the investment and the outcome.
“If corporations are to engage with and lead initiatives, they need a broad understanding of how quality education affects their business opportunities.”
ZB: As all eyes are on the global goals, do you have any ideas on how to engage the private sector and help mobilize resources to improve quality education?
VF: I think universities should take the lead to a certain extent, because that is part of our mandate—education is what we’re all about. A good start might be to create a space for companies and foundations to come together and share best practices, evidence of what works and what has been successfully scaled up or replicated.
At IMD business school’s elea Center for Social Innovation, we believe in bringing together investors, corporations and social entrepreneurs to find innovative solutions for serious societal challenges. We need to start thinking on a global scale and make research results more visible to the wider public. Expanding the existing body of knowledge could inspire more private capital to invest in impactful ventures, thereby pushing the agenda forward.
Lastly, a healthy degree of social activism, such as we are currently seeing in the context of the climate crisis, could help to achieve SDG 4.
“Companies want to know whether these interventions will become self-sustaining in the future. The intention is to create something long-lasting that does not depend on grants or the continuous injection of funds year after year.”
Vanina Farber is an economist and political scientist specializing in social innovation, entrepreneurship and sustainable finance. She also has almost twenty years of teaching, research and consultancy experience, working with academic institutions, multinational corporations and international organizations. She holds the elea Chair for Social Innovation at IMD business school. Vanina is interested in the application of innovative, practical, sustainable and inclusive market-oriented approaches that are seeking to change the world by eliminating the root causes of social ills. Her research focuses on scaling up social businesses and on innovations in inclusive value chains, with special emphasis on last-mile distribution.