The oil spill disaster in the Gulf of Mexico has placed renewed focus on clean energy, writes adjunct professor Bruce Usher, a carbon finance leader and executive in residence at the School.

In an op-ed in the New York Times (“Red China, Green China” May 6, 2010), Usher says that the United States lacks the political will to become a world leader in clean energy while China has been moving ahead with creating jobs and policies in the sector. Last year, China spent a total of $35 billion — double the amount of the United States — on projects related to renewable energy. In 2008, China held 84 percent of global market share for clean-development projects. Usher called for aggressive action by the United States to compete with China in the clean-tech race, outlining three actions to develop new technologies:

First, institute national feed-in tariffs or a renewable portfolio standard — two ways to require that utilities buy clean energy in a minimum amount or at a certain price. Such standards have been effectively put into practice in several states, most notably in Texas with wind power, but only a federal program will provide the scale necessary to compete with China, which has a national feed-in tariff program of its own.

Second, establish a price on carbon via either a tax or a cap-and-trade program to encourage low-carbon technologies. The Clean Development Mechanism placed a price on carbon in developing countries, initiating thousands of emissions-reduction projects in China. Putting a price on carbon in the United States would provide an incentive for domestic developers to build similar projects here.

Finally, get serious about supporting the research and development of carbon capture and storage, and maintain America’s lead in a field that offers enormous opportunity but is too large for any one company to finance. Coal is the No. 1 source of greenhouse gas emissions, and the first country to develop economically viable capture-and-storage technology will dictate the terms for reducing carbon dioxide emissions from coal-fired utilities globally.

How do we make decisions? If you believe classical economic models, decision making is a process of choosing the most rational and self-serving option. But, as Professor Stephan Meier’s research shows, many people’s decisions substantially deviate from this ideal. In fact, some individuals make consistently suboptimal choices, which can have an enormous effect on public policy and corporate strategy.

Meier’s research is focused on behavioral strategy, a subgroup of the growing field of behavioral economics. Behavioral economics marries standard economic theory with research in the field of psychology, often with surprising results.

Fruit or Chocolate?

In a famous experiment from 1998, Daniel Read and Barbara van Leeuwen of Leeds University Business School looked at how well individuals predict hunger and the effect of appetite on making choices. In the study, the researchers asked participants, “Deciding today, would you choose to eat fruit or chocolate next week?” Seventy-four percent of respondents chose fruit for next week. However, when the same respondents were asked about their choice a week later, 70 percent of them now picked chocolate, without regard to what was previously chosen. While this may not seem surprising to any chocolate lover, this effect is called present bias and it reveals an inconsistency in decision making not previously accounted for in economic theory and strategy.

Meier’s current research looks at the effect that present bias has on the financial services industry and the strategies firms can employ to provide benefits to both the nonrational consumer and the firm. In recent papers, he examined the links between present bias and credit card borrowing, showing that the association between higher credit card balances and present-biased individuals is robust — in other words, if you are the type of person who switched from fruit to chocolate, you will be more likely to have more credit card debt.

Capturing Value from Irrational Choices

Traditional for-profit financial services firms have used the irrational tendencies of consumers to their benefit — and even to the consumers’ detriment — which can result in long-term consumer attrition but high short-term profit margins. Meier suggests these firms might instead capitalize on the non-rationality of their consumers by offering products that benefit both parties, both to maintain long-term relationships and attempt to do well by doing good. For example, a firm could create a Christmas club account, which would allow consumers to save money in a non-interest bearing account for a specific purpose, such as the holiday.

Both the banks and the present-biased consumer benefit from this arrangement. Although it may seem like “doing well by doing good” is the social sector’s strength, there is also a lesson here for corporate firms: Think long term when building value for donors and design giving strategies that recognize and allow for nonrational decision making.

Meier encourages firms, both in the public and private sector, to “recognize people may make suboptimal decisions, but they are often systematic about these decisions. Since they are not random, firms can build on these behavioral patterns and predict how consumers may make decisions, designing products that maximize long-term value to the firm, not just squeezing short-term profits.”

This article also appeared in the Social Enterprise Club alumni newsletter. Learn more about the Social Enterprise Club and the Social Enterprise Program.

Photo credit: Flickr/The Consumerist

On November 18, three student teams gathered at Calder Lounge in Uris Hall to compete in the final round of the First Annual Columbia Business School Corporate Social Responsibility Case Competition sponsored by IBM. The winning team of Elizabeth McCarthy ’11, Blaire Fernandez ’11, Justin Kidwell ’11 and Kristin Stepaniak ’11 were awarded a prize of $1,500.

The case competition was organized in a joint effort by the CSR P2P Group, part of the Social Enterprise Club, and the General Management Association with the support of Columbia CaseWorks. It challenged teams of first- and second-year students to apply concepts and theories to a current challenging CSR issue.

This year’s case was “The Norwegian Government Pension Fund: The Divestiture of Wal-Mart Stores Inc.” written by Andrew Ang, the Ann F. Kaplan Professor of Business. The case considered the exclusion of Wal-Mart from the Norwegian Government Pension Fund’s investment universe and the subsequent divestiture of Wal-Mart by the fund; it looks at the issues socially responsible investing raises for portfolio managers.

The student teams presented their evaluations of the fund’s disinvestment and the judges critiqued them on their innovative approaches. Several proposed solutions emerged in each 10-minute presentation followed by a Q&A session. The panel of judges for the competition included Jennifer Crozier, Director, Corporate Citizenship and Corporate Affairs, IBM; Christopher Bishop, IBM; and Professor Ang.

After the students’ presentations, Ang, who has advised the government of Norway on strategic asset allocation for the past four years, expressed his point of view on the case. He has said the country has a history of ethical investing.

“Ethical considerations played an important part in running the fund,” he said. “Norway’s stance on ethical investing comes from the society and they view it as an important issue.” Ang also pointed out that it is not a “static process” but it has evolved and will continue to change in the future.

One of the main issues in the case of Wal-Mart was child labor, said Ang. In the past, the fund has excluded investments in firms that are connected to nuclear weapons and cluster bombs; it also has a history of exclusions based on humanitarian and environmental issues.

This case competition gives Columbia Business School students the unique opportunity to explore CSR topics while learning firsthand what goes into the effective implementations of corporate responsibility policies, and the challenges that companies and advocacies can face in the process. This inaugural competition was truly successful and we hope it has been just the first of many in the years to come!

Photo courtesy of Mara De Monte

In a recent Slate column — with a nod to the upcoming Vancouver Olympics — I describe a study by Dartmouth economist Eric Zitzewitz, who analyzed the sometimes shady world of Olympic figure skating. The figure skating community was shaken by a scandal in the 2002 Salt Lake City Games when a Russian judge, together with a bloc of other judges, allegedly colluded to hand victory to a Russian ice dancing pair over their Canadian competitors.

The International Skating Union responded by changing the way competitions are judged. Today, the scores are reported anonymously and only a subset of those are used in the final judging process. It may seem odd, at first, to expect that by removing direct public scrutiny of individual judges and concealing their identities, it would curtail vote trading. But the idea is that anonymity makes it hard to verify that corrupt judges have actually delivered the scores that they’ve promised — no one can tie any individual judge to a score. It’s hard to collude if you can’t tell whether your partner in crime is keeping up his end of the bargain.

Yet the study finds that these attempts at reducing collusion actually had the opposite effect. While it may have become a bit more difficult for corrupt judges to maintain a collusive arrangement, this effect was overwhelmed by the negative impact of reduced public scrutiny. Zitzewitz found that in the new system, having a home-country judge on the anonymous panel boosted a skater’s score by even more than it did under the earlier regime. (His data did not reveal, however, whether the home-country bias came just from the skater’s countryman, or a cabal of colluding judges — they were anonymous, remember.)

These findings are interesting even if you are not a fan of figure skating or sports in general, as they reveal some of the challenges in designing rules to fight corruption. With the right data we could run a similar type of study for, say, highway procurement contracts in California to analyze whether making bids public decreased corruption — because of greater public scrutiny — or increased it by making collusion among bidders that much easier.

The findings also highlight the unexpected effect of well-intentioned efforts to combat corruption. Anonymity could, in theory, have helped to make figure skating a cleaner sport. In reality, things played out very differently. The lesson, then, is that we should be open to experimenting with different means of keeping competition honest, whether there are highway contracts or gold medals at stake. And we need forensic statisticians with the data to see whether our experiments are successful.

The ho-hum results from December’s international climate summit in Denmark drew out uncertainty about the future of global environmental laws — and that could cripple economic progress toward lower carbon emissions, says Professor Shang-Jin Wei. The 2009 Copenhagen Accord recognized the need for cooperative action on climate change but no legally binding targets were set. In a recent interview with Public Offering, Wei, newly appointed director of the Jerome A. Chazen Institute of International Business, shared his thoughts on how innovation and the environment are tied to the global economy.

“The uncertainty over whether Copenhagen and related negotiations will turn into binding policies deters businesses and governments from moving forward,” he said. “If environmental policy is not law, then firms and governments don’t want to produce something that is 20 percent more expensive than existing, less environmentally safe products. However, once it looks more certain that a law is going to exist, firms will respond or, more likely, take advantage of whatever new laws will be put in place.”

Wei suggested that innovation of environmentally friendly products can benefit firms in both rich and poor countries.

“Invention and production don’t necessarily have to go together and outsourcing is a demonstration of that,” he said. “It is quite possible that both high-income and low-income countries can benefit. Firms in high-income countries can get royalties and other profits from inventing products and innovating ideas; low-income countries benefit by producing or assembling some of those products or parts.”

However, key questions remain: who will finance long-term carbon-reduction measures and what will those measures look like? Sharing the environmental and fiscal burden is likely to come through financial or technology transfer, or some combination thereof, from industrialized nations to emerging markets. Potential for new markets to leapfrog into next generation low-emission technologies is also a promising alternative. As the issue of legally binding targets gets closer to reality, Wei shed light on the view from across the Pacific.

“The governments of developing economies worry that industrialized countries have already reaped the benefits of emitting pollution into the atmosphere,” he said. “High-income countries have already had the main course. Now as emerging markets come to the table, they feel they only get the dessert but are being asked to pay for the entire bill.”

“Of course, inaction by all sides is not really an option,” he adds. “Science suggests we’re not running out of time right now but we’re on course to, and something has to be done.”

Photo credit: COP 15

If you have been on Facebook or Twitter in the last 24 hours, you may have seen mobile giving campaigns to aid Haiti. Red Cross and Yéle are among those organizations that have deployed viral giving models in the last 72 hours and have raised millions of dollars in individual donations.

When disaster strikes, charitable giving spikes dramatically. Professor Ray Fisman, director of the School’s Social Enterprise Program, cautions against less-than-honest schemes. Indeed, that has been a historic issue in Haiti. According to the January 13 New York Times op-ed by Tracy Kidder, there are more than 10,000 private organizations in Haiti with a “humanitarian mission” yet the country remains one of the poorest in the world. Fisman says that should not deter giving at the individual level, but rather heightens the importance of donating to well-run and professional aid organizations.

“It’s natural that at a time when an avalanche of cash is being thrown at a problem in a hurry — that’s the nature of disaster relief — opportunistic individuals will take advantage,” he says. “You can protect yourself to a large degree by donating through reputable channels.”

Fisman says a crisis like this also underscores the importance of all CSR policies, not just disaster-specific programs. In recent research on eBay’s GivingWorks program, he and his coreseachers found that following Hurricane Katrina the atmosphere of benevolence had a positive impact and nearly doubled all eBay charity-connected sales.

“At a time of great social need, consumers look very favorably on firms that show a charitable side,” he says. “We also saw this with all the good press that Walmart got for its quick and effective response to Katrina. Of course, companies should also consider helping out in relief efforts for the same reason individuals do — because it’s the right thing to do.”

Photo credit: Red Cross

The future of poverty eradication lies in the private sector, says Nancy Barry, president and CEO of Enterprise Solutions to Poverty. Barry, former CEO of Women’s World Banking, created the venture to mobilize corporations and entrepreneurs to engage millions of low-income people to build competitive business models. In an exclusive interview with Columbia Business School at the 2009 Social Enterprise Conference, Barry highlighted the ways in which U.S. and European multinational companies can learn from emerging markets.

“In [companies’] engagement they are still skating on the surface,” she said in the video interview. “Their traditional business models and ways of working are getting in their way. They need to actually learn from emerging markets and entrepreneurs how to build decentralized distribution systems. The beauty of decentralized systems is that the mom-and-pops of this world actually are the poor people. If you figure out a way how to add value to that mom-and-pop, which is your distribution system, you are helping that family make more money and you are selling more products.”

View more videos from the 2009 Social Enterprise Conference.

Creative models for buying and selling goods allow consumers to act philanthropically through charity tie-ins with product purchases. But are they profitable?

New research from Professor Ray Fisman, Dan Elfenbein of Olin Business School, Washington University in St. Louis, and Brian McManus of University of North Carolina, Chapel Hill, shows that linking a product with a charity donation is an effective way to boost sales — but not quite enough to make up for the cost in the bottom line.

In the study, Fisman and his academic collaborators worked with Steve Hartman ’07 (EMBA) to assemble data from eBay’s GivingWorks program, where sellers can offer a portion of their auction proceeds to a charity. They found that on average, an item advertised with a 10 percent donation is 20 percent more likely to sell than its non-charity counterpart, and for a price that’s on average 2 percent higher. But these benefits aren’t enough to make up for the cost of the 10 percent donation itself.

The study also showed that inexperienced sellers who lacked a selling track record benefitted from a charity tie-in more than experienced sellers. Fisman suggests that buyers see the charity tie-in as a signal of trustworthiness, which is particularly valuable to a seller that has yet to establish a reputation for reliability. The study also found that following Hurricane Katrina, the impact of charitable giving on sales and price nearly doubled; at a time of national need, benevolence actually became profitable. Fisman also cautions that immediate financial profit is often only part of the overall goal of companies’ giving programs. Good corporate citizens also may bolster their brands over the long-term, and also may contribute to the social good because it’s the right thing to do, whether or not it adds to the bottom line.

This research certainly doesn’t prove that you can’t do well by doing good, or that charity is a “waste” of shareholder dollars. Rather, it highlights the complicated relationship between corporate social responsibility and profits. As business school students and future business practitioners, it’s worth asking how companies can effectively integrate philanthropy and other aspects of CSR into their business models.

Photo courtesy of the Social Enterprise Program

Public Offering asked faculty members what books they enjoyed most this year and here’s what they said. (Take a look at last year’s list for more titles.)

Daniel Ames How to Break a Terrorist by Matthew Alexander is the story of the author’s experiences as a member of a U.S. intelligence and interrogation team working in Iraq in 2006. On one side, he struggles to coax information from hardened fighters as well as hapless suspects. On the other, he struggles with different attitudes in the military on the effectiveness of harsh interrogation techniques. It’s a fascinating glimpse into what is, for most of us, an unknown world. And the underlying story holds some lessons for how many of us might approach the “ordinary” conflicts in our everyday lives.

Ray Fisman Tokyo Vice: An American Reporter on the Police Beat in Japan by Jake Adelstein is an enormously entertaining and instructive look inside the world of the original economic gangsters.

Ray Horton I’ve read a number of good books on the now two-year-old economic crisis, including Robert Skidelsky’s  Keynes: The Return of the Master, Justin Fox’s The Myth of the Rational Market and Animal Spirits by George A. Akerlof and Robert J. Shiller. But the best of the bunch in my opinion is John Cassidy’s new book How Markets Fail: The Logic of Economic Calamities. He does the best job of tying the theory problems to the rationally irrational behaviors that nearly sunk the ship of modern finance.

	What is your book pick of the year? Please share your nomination.

Malia Mason The Big Sort: Why the Clustering of Like-Minded America Is Tearing Us Apart by Bill Bishop with Robert G. Cushing.

Emi Nakamura This Time is Different: Eight Centuries of Financial Folly by Carmen Reinhardt and Kenneth Rogoff.

Many notable books and ideas were published by faculty authors this past year as well. Several of these have been recently featured in Columbia Ideas at Work including: The Curse of the Mogul by Bruce Greenwald, Jonathan Knee and Ava Seave; The Aid Trap by Glenn Hubbard and William Duggan; and Value Above Cost: Driving Superior Financial Performance with CVA: The Most Important Metric You’ve Never Used by Don Sexton.

Photo credit: Melanie

One issue where progress could be made in Copenhagen is with the adoption of a deforestation policy or Reduced Emission from Deforestation and Degradation (REDD). Heal says that stopping deforestation by providing incentives for forest-rich countries can reduce 20 percent of greenhouse-gas emissions. He adds that it is relatively easy to accomplish because no new technology is needed.

The other step is to de-carbonize electricity supplies, which account for 30 percent of emissions says Heal. This can be accomplished through the use of renewable and nuclear energy, a better grid and carbon-storage technology. “Between deforestation and decarbonization of the electricity supply, you can basically remove enough CO2 emissions to stop the problem,” he says.

Chris Mayer, Senior Vice Dean, moderated a panel discussion on environmental policy and climate change on November 19. Speakers included Professors Geoff Heal, Elke Weber and Bruce Usher as well as Kevin Parker, Head of Asset Management, Deutsche Bank.

Last summer, more than 55 MBA students in the Social Enterprise Program participated in the Summer Fellowship Program. Their internships took place at a variety of organizations, from NGOs to venture capital firms. The fellows helped the organizations develop strategic planning, financial analysis and operational improvements. Students decamped to locations near and far — from Washington, D.C. to Cambodia — for 10 weeks and along the way kept journals about their experiences, which can be found online. Here are excerpts:

Jesus Rodriguez ’10
Entrepreneurship, Social Venture
Where Connect Us, a social start-up that is a pioneer in the use of cell-phone technology to improve healthcare for low-income people
What: To learn everything possible, from the inside, about a social venture start-up in order to start one myself in the future. As part of a team of three, with CEO Marc Lara ’04, I was able to do a little of everything: work on technical specifications, create selling presentations, review operations and conduct focus groups.
The takeaway: I was involved in the company’s negotiations for a $1.5 million contract with a pharmaceutical company. In the end, it did not come together, but I learned a lot of negotiation strategy. It also taught me that working in social venture is all about emotions and risks!

Jake Goldberg ’10
International Development, NGO
Where: PEPY, an NGO organization in the United States and Cambodia focused on improving standards of living in rural areas and education
What: To find distribution channels for the Hipster, a money belt constructed from khroma, traditional Cambodian scarves, and manufactured by women who are former sex workers; develop an e-commerce site and create a sales fulfillment plan for exports to the United States.
The takeaway: It was very powerful to be able to help these women market and sell their product on an international scale and help them start to find a way out of poverty. I also learned valuable lessons in pricing, exporting and distribution.

Melissa Cheong ’09
Investment, Business Development
Where: Enterprise Solutions to Poverty; Innosight Ventures
What: Research and deliver a list of industry contacts that have a high probability of evolving into valuable strategic or financial relationships for Innosight to make investments in the social venture space.
The takeaway: We had originally thought that targeting individual social angel investors would be most successful, but it became apparent we had more to gain targeting organizations and institutional investors. This meant we had to change our financing model. I learned that even though a lot of the early work we did on our plan wouldn’t be used, the experience was invaluable.

Learn more about the Summer Fellows Program and read more journal entries from the 2009 fellows.

Photos courtesy of the Social Enterprise Program

Last Thursday, Warren Buffett, MS ’51, and Bill Gates visited Columbia Business School. During the event, Gates identified energy — including renewable sources, like solar — healthcare and IT as the three sectors he sees as having the most opportunity for transformative growth in the foreseeable future. Buffett highlighted the high energy-efficiency and low environmental impact of rail transport as one of the key drivers of Berkshire Hathaway’s recently announced purchase of Burlington Northern Santa Fe Railroad. More MBAs than ever are looking for career opportunities in developing and investing in renewable energy. Where can they be found?

This past weekend, 50 Columbia Business School students were among the 2,400 attendees at the 2009 Net Impact conference at Cornell University. Net Impact is an organization for MBA students who share an interest in using business to make an environmental or social impact. Among the many panelists were leading investors in clean energy from Blackstone, Kleiner Perkins, JPMorgan Chase and Sequoia who spoke about what technologies and business models they believe have the greatest growth potential.

The investors focused on technologies that could, in the long run, be competitive without any subsidies or government support. To this end, they identified specific niches within energy-efficiency and waste-to-energy, as well as solar power.

Solar energy is viewed as an area with tremendous growth potential, with the U.S. market projected to grow 20-fold by 2020. Traditionally, solar energy has been extremely expensive and reliant on erratic government subsidies; however innovative leasing models, falling silicon prices and technological breakthroughs have reduced costs dramatically. Continued cost reductions along with carbon prices could make solar cost competitive with coal and natural gas.

Within solar energy, there are many technologies, and each has its own value proposition. Photovoltaic panels can be installed on rooftops for residential, commercial and industrial applications, or standalone, for us in utility-scale plants. Thin-film PV technology is very low cost but less efficient, making it the optimal solution for sites with plenty of space. Concentrating Solar Power (CSP) plants use mirrors to concentrate sunlight, which generates steam that spins a turbine to allow a much larger scale operation. All these technologies also have their downside — distributed PV generation does not permit economies of scale. Desert sites like those in the Southwest are most attractive for CSP, but CSP also requires a lot of water for cooling, as well as a challenging permitting and transmission environment.

In addition to solar, there is tremendous growth in wind, geothermal, combined heat and power, waste-to-energy and efficient energy. Nuclear energy is also slated for resurgent popularity. Repowering the world will provide tremendous opportunities for MBAs to generate value as investors, developers and operators of clean energy companies. Famed VC investor Vinod Khosla has invested in dozens of clean energy startups in the belief that the space will generate many $10 billion+ companies.

Photo credit: greenlagirl

They are two icons of American business — Warren Buffett, MS ’51, and Bill Gates. On November 12, Columbia Business School students will have the opportunity to connect with them in person. They will appear together in a special hour-long community forum at Columbia Business School, which will be filmed by CNBC for global broadcast. During the event, Buffett and Gates will field questions from students about the economy, the future of capitalism and corporate social responsibility.

It is the first time Buffett and Gates, who met each other in 1991, have appeared together at Columbia University. The last student forum they participated in was in 2005 at the University of Nebraska at Lincoln. Of the many bonds in their friendship, philanthropy and a shared philosophy of giving back to society is one of the strongest. In 2006, their relationship made the history books when Buffett announced that he would give the bulk of his estimated $40 billion fortune to the Bill & Melinda Gates Foundation.

Gates and Buffett’s latest ventures have been in recent headlines. Last week, Berkshire Hathaway announced a $26 billion deal for the railway company, Burlington Northern Santa Fe. Earlier in this year, Berkshire invested in BYD, a Chinese electric car company.

In a speech in October, Gates called for a new green revolution in agriculture and announced a $120 million package of agriculture-related grants to nine institutions around the world. Taking a page from Berkshire’s playbook, Gates wrote the foundation’s first annual letter this year and said the foundation will give away $3.8 billion in 2009.

CNBC will broadcast “Warren Buffett and Bill Gates: Keeping America Great” moderated by CNBC’s Becky Quick on November 12 at 9 p.m. and 12 a.m. ET . Join the conversation with other students on Facebook and on Twitter.

Photo courtesy of Columbia Business School

Today, one of TED’s offspring — an independently organized local version called TEDxEast — is taking place in New York City. Professor William Duggan, author of Strategic Intuition and co-author of The Aid Trap, written with Dean Glenn Hubbard, and Naif Al-Mutawa ’03, founder of The 99, are among the speakers at the inaugural event. Other speakers include author Suzy Welch, 10-10-10: A Life-Transforming Idea; Scott Heiferman, CEO of Meetup; and Chris Elam, artistic director of Misnomer Dance Theater. Ed Rashba ’04 and Melek Pulatkonak ’02 helped organize the event.

TEDxEast is streaming live from the City Winery in New York City from 1 to 6:30 p.m. ET on November 6. Check back soon for video clips from the event.

	Students at the University of Dar Es Salaam listen to a lecture.

At last night’s Community Forum, Dean Glenn Hubbard, professors Bill Duggan and Gita Johar, and Eric Tienou ’03 of Burkina Faso discussed economic development in Africa. Hubbard and Duggan’s recently published book The Aid Trap (see blog post) advocates for aid investment directly into the small business sector rather than charitable aid through NGOs. Hubbard, who also spoke last week at the “Peace Through Reconstruction” conference, has said that a Marshall Plan-like program is not only a moral and economic imperative, but also good foreign policy for the United States. (Watch a video of his presentation.)

One example of how the development of the small business sector is taking place is emerging through the School’s partnership with the University of Dar Es Salaam (UDBS) in Tanzania, Africa. The partnership is made possible through Goldman Sachs’ 10,000 Women program.

Several faculty members, including Murray Low, Eric Abrahamson and Gita Johar, spent last summer working in Tanzania to teach students and UDBS faculty members. The goal of their work was twofold: to prepare local students to earn a cobranded advanced certificate in entrepreneurship and business management, and to facilitate UDBS faculty members in learning interactive case method teaching. The School is also helping to establish a PhD program at the African university.

“The group of students was incredibly diverse,” Johar said about her experience teaching. “We had chicken farmers and dried fruit distributors to engineers, consultants and a range of microfinance entrepreneurs.” This summer completed the first of a five-year teaching exchange.

While many of the challenges for small business owners in Tanzania are familiar — management, staff turnover and competition — the biggest challenge, said Johar, is access to capital. “Friends and family are the bank,” she says, noting that bank loans are virtually nonexistent. Nonetheless, students were very enthusiastic about the material.

“We were thrilled,” she says. “They were very hungry to learn and apply the teaching to their ventures.”