AUGUST 29, 2011
Graduate School of International Policy & Management
COURSE SYLLABUS – Fall 2011
IPOL8623: Business Models for Sustainable Development
4 credits
August 29-December 13 Thursday 8:00-9:50 am
Room: Morse A101
Prof Lyuba Zarsky
McCone 119
lzarsky@miis.edu
Office Hours:
Wednesday 4-6 pm and by appointment
COURSE DESCRIPTION
A wide range of actors--small and medium sized firms, social entrepreneurs, NGOs, impact investors,
international development organizations, multinational corporations--are increasingly looking to marketbased approaches to deliver social and environmental benefits.
This seminar explores the emerging use of business models to promote sustainable development,
defined as improving the well-being of the poor while promoting eco-system resilience. Dominant
development strategies employed by both government and business focused solely on growth tend to
exclude the poor and degrade natural resources.
Business models define the way that enterprises create value by generating revenues through sales of
products or services. To be financially sustainable, a business model must generate sufficient revenues
to cover costs and earn a surplus/profit. Business models for sustainable development engage the poor
as consumers, producers, and/or suppliers of environmentally sustainable products and services.
In this seminar, we will first explore the institutional context in which sustainable business models are
emerging, including the ‘impact investment’ and ‘social responsibility’ movements; and then consider
theoretical and methodological issues, including an analytical framework for ‘sustainable development’,
a generic methodology for the design of a business model, and metrics for evaluating financial, social
and environmental performance. We will also examine the key role of finance for sustainable business
models, including social impact investing and micro-finance; and the role of government policy in helping
sustainable business go to scale.
The second part of the seminar examines inclusive business models in four key sectors for sustainable
development—energy, agriculture, water, and fisheries—and in the emerging area of climate resilience
in coastal cities. For each sector, we will consider the key sustainability and development challenges
and explore a range of successful business models. We will conclude by examining the challenge of
going to scale, both in terms of business growth and development strategy.
Students will work in teams of four to undertake and orally present an in-depth case study of a
successful business model is one of the five sectors. Students will also work in teams of two to design a
business model and, in the final part of the seminar, present it to the class as a “pitch” to investors.
*Syllabi are subject to change by the instructor with advance notice to students
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COURSE OBJECTIVES
____________________________________________________________________________________________
Upon completion of this course, you will be able to:
 Understand and utilize a methodology to design a business model;
 Understand the difference between “poverty alleviation” and “development”;
 Articulate a theoretical framework for “sustainable development”;
 Understand sustainability opportunities and challenges for business models in five key sectors
(energy, agriculture and forestry, water, marine/coastal, and coastal urban climate resilience);
 Understand the relationship between sustainable development and climate resilience;
 Evaluate social and environmental benefits of a business model;
 Understand the challenges and opportunities of social impact investing;
 Critically assess proposed policies to scale up successful business models;
 Design and undertake a business model case study;
 Design a business model that promotes sustainable development.
TEXTBOOKS AND OTHER MATERIALS
Required texts: None
Recommended texts (on reserve in MIIS library):
Boyd, Brewster, Nina Henning, Emily Reyna, Daniel E. Wang, and Matthew D. Welch, Hybrid
Organizations, New Business Models for Environmental Leadership, Greenleaf, 2009.
Hamann, Ralph, Stu Woolman and Courtenay Sprague, The Business of Sustainable Development in
Africa, Human Rights, Partnerships, Alternative Business Models, Tokyo: UNU Press, 2008.
Hamschmidt, Jost and Michael Pirson (eds.) Case Studies in Social Entrepreneurship and Sustainability,
The Oikos Collection Volume 2, 2011.
Hamschmidt, Jost (ed). Case Studies in Sustainability Management and Strategy, The Oikos Collection,
Greenleaf, 2007.
Hart, Stuart L., Capitalism at the Crossroads: Next Generation Business Strategies for a Post-Crisis
World, third edition, Wharton Press, 2010.
Osterwalder, Alexander and Yves Pigneur, Business Model Generation, John Wiley & Sons, 2010.
Prahalad, C.K. The Fortune at the Bottom of the Pyramid, Eradicating Poverty Through Profits,
Wharton School Publishing, 2005.
Waddock, Sandra and Malcolm McIntosh, SEE Change, Making the Transition to a Sustainable
Enterprise Economy, Greenleaf Publishing, 2011.
*Syllabi are subject to change by the instructor with advance notice to students
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Websites: You can find examples of or pointers to case studies of sustainable business models in
the Boyd et al and Hamschmidt and Pirson books above, in many of the assigned readings and on
these websites:
General
World Resources Institute, Next Billion: Development through enterprise
http://www.wri.org/project/nextbillion
Monitor Institute
http://www.monitorinstitute.com/impactinvesting/
Global Impact Investing Network
http://www.thegiin.org/cgi-bin/iowa/home/index.html
Business fights poverty, case studies
http://www.businessfightspoverty.org/
Aspen Network of Development Entrepreneurs
http://www.aspeninstitute.org/policy-work/aspen-network-development-entrepreneurs
International Institute of Environment and Development, Sustainable Markets
http://www.iied.org/sustainable-markets/home
Energy
Ashden Awards for Sustainable Energy
http://www.ashdenawards.org/
FAO-PISCES Case studies of small-scale bio-energy initiatives
http://www.dfid.gov.uk/r4d/SearchResearchDatabase.asp?OutPutId=179616
e+co Energy through Enterprise
http://eandco.net/
Agriculture
Sustainable Food Laboratory
http://sustainablefood.org/
Water
Water for People, Initiatives
http://www.waterforpeople.org/programs/how-we-work/initiatives/
Acumen Fund, Water portfolio
http://www.acumenfund.org/investments/portfolios/water-portfolio.html
Fisheries
Sustainable Fisheries Partnership
http://blog.iblf.org/
Network of Aquaculture Centers in Asia-Pacific
http://www.enaca.org/
*Syllabi are subject to change by the instructor with advance notice to students
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METHODOLOGY AND POLICIES
The course methodology consists of lectures by instructor, guest speakers, student discussion in large
and small groups, in-class and out-of class discussion, student oral presentations, and in-class
exercises. Essential parts of the methodology are the two class assignments, viz, a case study of a
currently functioning business model that students will undertake in teams of four and which must
include both desk review and at least two interviews; and the business model that students will design in
teams of two and present as a “pitch” to investors.
Students are expected to do all the readings and attend all class sessions. More than one unexcused
absence will result in a grade of “Incomplete”.
ACADEMIC CONDUCT
Student Honor Code
All members of the Monterey Institute student community shall adhere to and help maintain a
high level of personal and professional behavior that is respectful of the dignity of all persons,
respectful of the rights and property of others, and treats equally the ideas and opinions of all
students who work and study at the Institute. These responsibilities include concern for the
feelings of others and their right to live and study in conditions that support their work and
development. Allegiance to these ideals requires each Institute student to refrain from and
discourage behaviors that threaten the freedom and respect every individual deserves.
The student conduct code promotes a campus environment that supports the overall educational
mission of the Monterey Institute and is intended to help protect the Institute community from
disruption and harm; to encourage appropriate standards of individual and group behavior; and to
foster ethical standards and civic virtues. A due process is also set forth as an integral part of the
code and to be used in those cases when the conduct of a member of the student community has
been brought to the attention of the student conduct administrator.
PLAGIARISM: The term “plagiarism” means representing another individual’s words, ideas, opinions, formulæ,
programs, or products as one’s own without attributing them to their true sources. Intentional or
unintentional failure to attribute facts that are not common knowledge (whether represented in
textual, graphic, statistical, or visual form) also constitutes plagiarism. All writing submitted for
formal and informal assessment must be the student’s own work.
Whether a student copies verbatim or paraphrases without explicitly acknowledging the source,
the student has committed intellectual property theft. Receiving permission from the original
author to use his or her ideas or words is irrelevant and in no way lessens the seriousness of a
failure to acknowledge and credit sources. Writing a paper by cutting and pasting passages from
other sources is never acceptable, even if those sources appear in the reference list or
bibliography. In drafting and composing all papers and other written work, students must make
every effort to distinguish their own ideas, arguments, and knowledge from information derived
from other sources. These sources include not only published primary and secondary print and
digital texts, but also information, opinions, and arguments gained directly from other persons ,
including fellow students.
Individual students are responsible for learning effective methods of acknowledging and citing
sources. They should consult their instructors, the Graduate Writing Center, as well as other
reputable resources that define plagiarism and that provide instruction on avoiding this serious
breach of academic and professional conduct. Further resources available for avoiding plagiarism
and the perception thereof include software programs designed to detect plagiarism.
Policies and Standards Manual, Spring 2011
*Syllabi are subject to change by the instructor with advance notice to students
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Any evidence of plagiarism in this course will be considered a violation of the Honor Code and will be investigated
and if appropriate, disciplinary action will be taken. If you have any questions about whether you are providing
adequate acknowledgement of others’ work, please ask the instructor.
REQUIREMENTS AND GRADING
Students are expected to come to class having completed assigned readings and to add value to class
discussions. Assessment will be based on:
1. Business model case study -- 35 points
Working in teams of 4-5, students will describe and evaluate the business model of a functioning
“sustainability impact” business that aims to serve the poor in one of five sectors: energy, water,
agriculture, marine/coastal resources, and coastal city climate reslience. The case study will
utilize The Business Model Canvas as an analytical framework and SWOT to evaluate its
strengths and weaknesses. The case study should be no more than 3500-4000 words in length.
Students will be graded as a team.
2. Oral presentation of business model case study – 25 points
Students will make an oral presentation of their case study in class, followed by a question and
answer period. The presentations will occur in the class relevant to that sector. Each student will
be assessed on their individual presentation but the team will receive one grade based on the
average of the individual grades.
3. Investor pitch -- 40 points
Working in groups of two, students will design and orally present a proposed business model in
class as a “pitch” to potential investors. The model should specify the need for the business, how
it will address the 9 Building Blocks, the method of evaluation of social and environmental
impacts, and the need for start-up capital. There will be an award for the model selected by
professor and students as the most investment-worthy.

Letter grades will be based on the following performance:
A
90-100%
(Excellent)
B
80-89%
(Good)
C
70-79%
(Satisfactory)
D
60-69%
(Poor)
F
0-59%
(Fail)
Grades will be awarded with plus and minus designations when the student’s numerical score is in the very top or
bottom end of the grade ranges described above. As noted in the PSM, quality points are assigned as follows:
A and A+ 4.00 grade points per credit.
A- (minus) 3.67
C 2.00
D+ 1.33
B+ (plus) 3.33
C+ 2.33
D- 0.67
B 3.00
C- 1.67
F (Fail) 0.00
B- 2.67
D 1.00
P (Pass) Credit for course, no grade points.
NP (No Pass) No grade points or credit.
I (Incomplete) No grade points or credit.
W (Withdrawal with permission) No grade points or credit.
AU (Audit) No grade points or credit.
*Syllabi are subject to change by the instructor with advance notice to students
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IP (In Progress) No grade points or credit.
There is no other system of grading or grading category at the Monterey Institute other than
those listed above.
Except for grades of “I’ and “IP,”(see sections 5.3 and 5.4 in Policies and Standards Manual ) all grades are
considered final when reported by a faculty member at the end of a semester or marking period. A change of grade
may be requested only when a calculation, clerical, administrative, or recording error is discovered in the original
assignment of a course grade or when a decision is made by a faculty member to change the
grade as a result of the disputed academic evaluation procedure (see section 5.2 in Policies and Standard
Manual). Grade changes necessitated by acalculation, clerical, administrative, or recording error must be reported
within a period of six months from the time the grade is awarded. No grade may be changed as the result of a
reevaluationof a student’s work or the submission of supplemental work following the close
of a semester or marking period. The Records Office shall only accept permissible changes of
grade upon written approval of the faculty member’s dean, who shall first verify that the Change
of Grade request satisfies legitimate criticism.
SCHEDULE AND WEEKLY ASSIGNMENTS
Course outline
September 1
Global poverty and sustainability: why business?
September 8
Sustainable development: a framework and a vision
September 15
What is a (sustainable) business model?
September 22
Finance for sustainable business models
September 29
Measuring performance: financial, social, environmental
Guest speaker: Lindsey Yeung, Aspen Network for Development
Entrepreneurs
October 5
Bio-fuels: Market promise and governance challenge
Jacob Deline, Abundant Bio-Fuels
Kevin Fingerman, Round Table on Sustainable Bio-Fuels,
Casa Fuente 434, 6-7:50 pm.
October 6
Policies that support scale-ability of sustainable business models
October 13
Energy
October 20
Water
October 27
No class (instead attend Bio-Fuels panel on October 5)
November 3
Agriculture
November 10
Fisheries
November 17
Coastal city climate resilience
November 24
NO CLASS – Thanksgiving
December 1
Student pitches of proposed business
December 8
Student pitches of proposed business
*Syllabi are subject to change by the instructor with advance notice to students
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Course readings and assignments
Sept 1
Global poverty
and
sustainability:
why business?
1) Waddock and McIntosh, Chap 1, The context for SEEing
Change (on reserve)
2) World Business Council for Sustainable Development,
Vision 2050, The new agenda for business in brief
http://www.wbcsd.org/web//projects/BZrole/Vision2050_Summary_
Final.pdf
3) Monitor Institute, Promise and progress, market-based
solutions to poverty in Africa, Executive Summary
(online)
4) Foster, The business sector’s pivotal role in growth,
http://blog.iblf.org/
In class: Students form teams for case studies
Sept 8
Sustainable
development: a
framework and a
vision
1) Easterly, The Elusive Quest for Growth, prologue and
Chap 1
2) Sen, Development as Freedom, preface and Introduction
3) Hahn, Sustainable development at the BoP, chap 25 in
Kandacher and Halme
4) Swedish Environmental Advisory Council, Resilience
and sustainable development
http://www.sou.gov.se/mvb/pdf/206497_Resilienc.pdf
5) Porritt, Sustainable development for real, pp. 21-34
Out of class assignment: Teams meet to select and develop
methodology to undertake case study
Sept 15
What is a
1) 1) Osterwalder and Pigneur, Business model generation,
(sustainable)
pp 14-55 & 200-225
business model?
2) Willard, 5 Criteria for a sustainable business model
http://sustainabilityadvantage.com/2010/08/10/5-criteria-for-asustainable-business-model/
3)
4) 3) DEFRA, What is a sustainable business model?
http://sd.defra.gov.uk/2011/01/sustainable-business-model-aseven-point-plan/
5)
6)
4) Monitor Institute, Promise and Progress: Market-Based
Solutions to Poverty in Africa, Executive Summary,
(online)
Supplemental:
Boyd Chaps 1-4
Monitor Institute, Emerging Markets Emerging Models
(online)
*Syllabi are subject to change by the instructor with advance notice to students
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Sept 22
Finance
1) Monitor Institute, Investing for social and environmental
impact, pp 3-41 (online)
2)
New sources of funding
http://www.nextbillion.net/blog/2009/12/18/root-capital-eco-tapmajor-new-funding
3) 3) Hamschmidt and Pirson, Oikos Collection, Case 7, Atlis,
A microfinance startup in rural Nepal
Supplemental:
UNDP, Bringing small scale finance to the poor for modern
energy services: what is the role of government?
Sept 29
Measuring
performance
Guest speaker:
Lindsey Yeung
Aspen Network
of Development
Entrepreneurs
1) Aspen Network of Development Entrepreneurs, 2010
Impact Report, Executive Summary
http://www.aspeninstitute.org/sites/default/files/content/docs/
pubs/ANDE_Impact_Report_Executive_Summary_Final_Engli
sh.pdf
2) e+CO Monitoring and evaluation program
http://eandco.net/impact/monitoring-and-evaluationsprogram/
3) Impact Reporting and Investment Standards, read
website
http://iris.thegiin.org/about-iris
Oct 5
Oct 6
Guest speakers
6-8 pm
Casa Fuentes
434
Policies that
promote scaleability of
sustainable
business models
Bio-fuels: Market Promise and Governance Challenge,
Jacob Deline, Abundant Bio-Fuels
Kevin Fingerman, Round Table on Sustainable BioFuels
1) Monitor Institute, Impact investing: A framework for
policy design and analysis, pp 14-30, 42-58, 74-78
2) Grounding Green Power, Executive Summary
http://pdf.wri.org/working_papers/grounding_green_
power.pdf
3) Wilson et al, Lights on or trade off? Can base-of-the
pyramid approaches deliver solutions to energy
poverty? In Kandachar and Halme, Chap 2
October 13
Energy
1) Energy poverty: the hidden energy crisis, Practical
Action
http://practicalaction.org/docs/advocacy/energy_poverty_hid
den_crisis.pdf
2) Fabio Rosa, Bridging the electricity divide in Brazil,
Oikos Collection, Case 5
(cont’d) next page)
*Syllabi are subject to change by the instructor with advance notice to students
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3) WRI, Power to the people: investing in clean energy
for the base of the pyramid in India
http://pdf.wri.org/power_to_the_people_front.pdf
4) Univ of Michigan Business School, Tecnosol case
study
Supplemental:
PISCES and FAO, Small-scale bio-energy initiatives pp i-53,
67-69 (online)
Krupp and Horn (on reserve) Chap 6
Greenbiz , Grameen Shakhti
http://www.greenbiz.com/blog/2009/01/21/grameen-shakti
October 20
Agriculture
1) Jonathan Foley, The other inconvenient truth: the crisis
in global land use
http://e360.yale.edu/feature/the_other_inconvenient_truth_the_c
risis_in_global_land_use/2196/
2)
2) CIAT, Study reveals “hot spots” of risk…climate change
http://www.ciat.cgiar.org/Newsroom/Lists/News/DispForm.
aspx?ID=76
3) IIED, Under what conditions are value chains effective
tools for pro-poor development? pp 2-41
http://pubs.iied.org/pdfs/16029IIED.pdf
4) Branzei and Valente, Honey Care Africa
5) New business models for sustainable trading
http://www.nextbillion.net/blog/2010/03/02/new-businessmodels-for-sustainable-trading-part-3
6)
5) Promise and Progress, Smallholder farmer aggregation,
pp 52-63
7)
8)
6) Unilever unveils plan to decouple business growth from
environmental impact
http://www.unilever.com/mediacentre/pressreleases/2010/Unile
verunveilsplantodecouplebusinessgrowthfromenvironmentalim
pact.aspx
9)
10) 5) World Economic Forum, A New Vision for Agriculture
https://members.weforum.org/documents/ip/CO/AFB/CO_New_
Vision_for_Agriculture_Initiative_Overview.pdf
Supplemental:
Boyd, Chaps 6 and 8
FAO, How to feed the world by 2050
http://www.fao.org/fileadmin/templates/wsfs/docs/expert_paper/H
ow_to_Feed_the_World_in_2050.pdf
Sonja Vermeulen and Lorenzo Cotula, Making the most of
agricultural investment: A survey of business models that
provide opportunities for smallholders, IIED and IFAD, 2010
(online)
*Syllabi are subject to change by the instructor with advance notice to students
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October 27
NO CLASS
Attend Bio-Fuels
Panel on October
5 (see above)
Nov 3
Water
1) UNDP, Summary Human Development Report 2006,
Beyond Scarcity: power, poverty and the global water
crisis, Overview
2) Hamschmidt and Pirson, Oikos Collection, 2011:
- Case 10, Trevor Field and the PlayPumps of
Africa
- Case 11, Water Health International
Supplemental:
Oikos Collection Case 9, Proctor and Gamble’s PuR Water
Purifier
UN World Water Development Report 2009
http://www.unesco.org/water/wwap/wwdr/
Nov 10
Fisheries
1)
Shocking report shows world’s oceans facing
extinction crisis, June 2011,
http://www.whatsondalian.com/news-1093-shocking-reportshows-world-s-oceans-facing-extinction-crisis.html
2)
Coastal ecosystems for countless benefits, Coral Reef
Targeted Research and Capacity Building for
Management Program, Advisory Paper, October 2009
http://www.gefcoral.org/LinkClick.aspx?fileticket=a%2FgLXsU
1HwM%3D&tabid=2967&language=en-US
3)
Poverty alleviation in small-scale fishing communities,
http://www.bobpigo.org/bbn/sep_04/Pages-6-10.pdf
4)
Alexander Nick, Transforming the global fishing
industry: The Marine Stewardship Council at Full Sail?
in Hamschmidt, 2007 Case 5
5)
Conservation Magazine, Taming the blue frontier, June
2009, http://www.conservationmagazine.org/2009/04/tamingthe-blue-frontier/
6)
Environmental Defense, Sharing the catch in Belize,
http://www.edf.org/oceans/sharing-catch-belize
7)
FAO, Pro-poor seafood trade: challenges and
investment opportunities for small-scale aquaculture
farmers
Supplemental:
De Silva and Davey (eds) Success stories in Asian
aquaculture, Network of Asian Aquaculture, 2009
(available on line
*Syllabi are subject to change by the instructor with advance notice to students
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Nov 17
Coastal city 1)
climate resilience
1) World Bank, Climate change, disaster risk and the urban
poor http://resilient-cities.iclei.org/fileadmin/sites/resilientcities/files/Images_and_logos/Resilience_Resource_Point/World_
Bank_2011_Mayors_task_force_brochure.pdf
2) WWF, Mega stress for mega cities, 2009, Executive
Summary (online)
3)
Nov 24
Intellcap, Opportunities for private sector engagement
in urban climate change resilience building, 2011,
pp 5-39 (online)
THANKSGIVING HOLIDAY
Dec 1
Student “pitch”
presentations
Dec 8
Student “pitch”
presentations
*Syllabi are subject to change by the instructor with advance notice to students
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