Declining employment prospects in banking and finance coupled with a desire for more meaningful work have led to an increase in the number of MBA students looking to build careers in social enterprise and the not for profit sector.

Lumped together under the label “third sector”, not for profit organisations, charities and social enterprise form a fast growing niche with strong links to corporate social responsibility. The sector is increasing its share of MBA employment. About 10 per cent of Cass Business School MBA students are either from the third sector or are hoping to work in the field.

Paul Palmer, professor of voluntary sector management, says: “Having the chief executive of a social enterprise or a director of an NGO adds to the diversity of the student group.”

Palmer, who divides his time between the Cass Centre for Charity Effectiveness and teaching sustainability and corporate ethics on the MBA course, points to a link between corporate social responsibility and social entrepreneurship. The website socialenterprise.org.uk lists for profit ethical businesses in areas such as recycling, fair trade, carbon offsetting and renewable energy. Many are offshoots of large businesses.

Interest in the third sector is partly down to a generational shift in attitudes. Ashridge Business School carried out a survey of the learning preferences of Generation Y, the age group born after 1982. The research paper, Generation Y: Inside Out, found that a renewed interest in ethics could reshape the direction of the MBA.

Sue Honoré, associate learning consultant, says: “There is more of a ‘society’ feel to this generation. It has grown up with climate change and sustainability. Generation Y wants something more than just a job.”

Research is helping to fuel interest. Henley Business School, part of Reading University, has a Centre for Voluntary Sector Management. Susan Rose, associate head of the School of Management, says: “Companies are starting to develop initiatives or business units with a specific remit to work collaboratively with not for profit organisations on areas such as climate change or the environment.”

Oxford University’s Saïd Business School is home to the Skoll Centre for Social Entrepreneurship. The centre’s director, Pamela Hartigan, says: “Social entrepreneurs are looking at ‘how do I create value for society?’ It’s not about ‘me and padding my pockets’.”

But while such people may be optimistic and visionary they are not necessarily good managers. Hartigan says: “What the sector needs is really good managers and the MBA plays a valuable part in this.”

While the bulk of MBA students still aspire to high-earning careers in finance or consultancy, there is a new ethical awareness. Rose observes: “Ethics is the new differentiator. Students selecting an employer now ask what action the company is taking on climate change or sustainability.”

Placed number one in the UK for integrating ethics with business teaching by a recent survey, Nottingham University Business School owes its reputation to its International Centre for Corporate Social Responsibility. Julie Blant, postgraduate careers service manager, says: “About 80 per cent of students who have taken the social enterprise or corporate social responsibility strands to the MBA find work in a related roles. It’s nothing to do with the banking crisis but everything to do with the notion of ethical products and fair trade.”

Aiming for the top

Halfway through the “seven summits”, a sponsorship challenge that involves climbing the highest peak on each of the world’s continents, MBA student Jason Watkins, of Nottingham University Business School, is putting social responsibility into action, Stephen Hoare writes. He has Mount Aconagua in the Andes, Mount Vinson in Antarctica and Everest left to conquer.

Watkins, 39, is as ambitious about raising money for mental health and children’s charities as he is about his plans to set up an online business helping homeowners to make energy savings. He is one of a growing breed of MBA students who believe it is possible to combine making a profit with a social conscience.

He says his MBA in entrepreneurship has taught him a lot about himself and what he is capable of doing. “Social enterprise is not going to make me rich but if I can help others by running an ethical business and still make a profit, that is sufficient. I’m a humanitarian.”

His course includes modules in corporate social responsibility and social enterprise.

Having sold one business, Kitbag.com, at the height of the dot-com bubble for £20 million and currently running Sapio Solutions, a provider of e-commerce packages, the energetic Watkins finds that ethical business has a lot more in store than he imagined.

He says: “There’s a core of about ten students on my course who are interested in social enterprise.”