With research focused on political hazards in international investment strategy and corporate diplomacy, extensive experience consulting for organizations such as AngloGold Ashanti and the International Finance Corporation, and a new book, Wharton Prof. Witold Henisz is a world-renowned expert in his field and esteemed teacher in the EMBA program. We recently asked Prof. Henisz to tell us more about his classes and research.
What classes do you teach in Wharton’s EMBA program?
I started teaching EMBA classes 13 years ago. I most commonly teach an elective called The Political and Social Environment of the Multinational Firm. I also occasionally teach the global strategy section of the core course called Managing the Enterprise. Over the years, I’ve taught in both Philadelphia and San Francisco.
What do you like about teaching EMBA students? Is there a difference between students on each coast?
I love how EMBA students can apply classroom content in real time. Two weeks after a class, it’s common to hear how discussions, tools and learnings from the prior session helped them and their companies. Also, EMBA students are at a point in their lives of maximum stress with families and full-time careers, yet they are choosing to come back to school. That shows a real commitment to learning, sharing experiences, and a hunger to take new content and connect it to business challenges.
As for Wharton San Francisco, I enjoy teaching there. The students on the West Coast are a little different from the East Coast; they tend to bring more tech and manufacturing content into the classroom, and have more direct experience with global supply chains. I can then take that back to the students on the East Coast. Every group of students is different and I find that diversity enriching.
How is your course structured?
It is a case-based elective. I try to keep an active case discussion so students can connect what we are reading to what they have experienced or are experiencing in their firms. In this area, there are no hard answers or formulas to work with. Instead, these issues have to be thought through and analyzed.
What do you want students to get out of your course?
I want them to be more aware of the political challenges and opportunities they will face as they move forward in their careers. It’s common to look at a challenge by applying existing rules and incentives, but higher order questions are: Why do we have these rules and incentives? How can we be a player in changing the political or regulatory system? How can we build better relationships with the actors in this environment? I want students to have the tools to measure how an investment in things like stakeholders or political capital will pay off.
What kinds of students take your elective?
Students who recognize that as you move up to senior management, you’ll spend more time dealing with external stakeholders. My students aspire to be corporate diplomats and to create shareholder and societal value through their interactions with NGOs, community leaders, and government officials as well as through the management of their company’s reputations online. Students who recognize that these are key skills are drawn to the elective.
Can you tell us more about your research areas?
The topic of the class is also my primary area of research. I’m finishing up a multiyear project on the mining industry where we demonstrated the financial returns to investing in stakeholder capital, and the types of investments that were valuable. I’m now starting a new project looking at the 1,000 largest CAPEX projects in the world in upstream energy and transportation. I’m asking why those multi-billion-dollar projects are, on average, 50% over budget and five years behind schedule. I’m showing how the skills we teach in class could help managers save literally trillions of dollars and years of time while addressing societal needs.
What consulting projects are you working on?
I continue to work on an occasional consulting project to stay on the front lines where my students are or aspire to be, and to continue to learn. Last year, I wrapped up a project with Anglogold Ashanti in which we worked with the company in six countries in Sub-Saharan Africa to improve relations with external stakeholders. I’m now working on two projects with the International Finance Corporation, which is part of the World Bank. The projects are making the case for emerging market financial institutions to devote more resources to managing environmental and social risk and assisting in the development of a stakeholder risk “dashboard” tool.
You published a book last spring. What was that about?
The book is called Corporate Diplomacy and showcases the art and science of managing relations with stakeholders in a manner that adds to shareholder value. The book features tools from the front lines of corporate diplomacy in industries like mining, the military, and oil and gas – sectors where if you don’t win hearts and minds, you will fail. It works through the best practices and tools readers can use. The course is built around the book, and the book grew out of the course. As a result of the book, I’ve gone on a book tour and spoken with alumni groups around the world. I enjoy reaching a broader audience with the book. I also have been active on Twitter on this topic and post to an open LinkedIn Group. My Twitter handle is Whenisz and the LinkedIn Group is entitled “Corporate Diplomacy.”