The Michael Lee-Chin Family Institute for Corporate Citizenship helps business leaders – both current and future – integrate sustainability into business strategy and practices.

LEE-CHIN INSTITUTE ANNUAL REPORT / 2

Sustainability and the potential for the positive impact of business on our society and environment has never been more important. This year, the Rotman School of Management intensified its commitment and support for these issues and for the Lee-Chin Institute. In this favourable context, our work, presence, and impact, is accelerating.

2 WELCOME4-5 YEAR IN REVIEW6-7 INSPIRING NEW THINKING8 OUR IMPACT THIS YEAR9 DEDICATED RESEARCH10-11 SUPPORT FOR RELATED ACADEMIC RESEARCH12 DISSEMINATING RESEARCH THROUGH EVENTS AND MEDIA13 ENHANCING CURRICULAR & CO-CURRICULAR ACTIVITIES14 THE YEAR AHEAD: 2015-16

TABLE OF CONTENTS

THE YEAR IN REVIEWBY LCI RESEARCHERS (TO DATE):

NEW FELLOWS OF THE LEE-CHIN INSTITUTE

CREATED SUSTAINABILITY AT ROTMAN WORKING GROUP

45SPONSORED THE HULT PRIZE, ROTMAN NET IMPACT CASE COMPETITION, & HOSTED

1BOOK

539 42 95

6 12PUBLISHEDARTICLES

WORKINGPAPERS

TRADEPUBLICATIONS

COLUMNS &BLOGS

PRESENTATIONSDELIVERED

APPEARANCESIN RELATED INTERVIEWS & NEWS ITEMS

ALEXANDER DYCKANDRÁS TILCSIK

MEMBERS INCLUDING STUDENTS, STAFF, FACULTY

5

544 IN ATTENDANCEEVENTS

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BY LCI SUPPORTED ROTMAN FACULTY AND PHDS (TO DATE):

1 BOOK

3 BOOK CHAPTERS

21 ACADEMIC ARTICLES

6 SUBMITTED ARTICLES

19 WORKING PAPERS

ROTMAN TEAM WINS HULT PRIZE SEMI-FINALS IN DUBAI. HEADED TO GLOBAL FINALS IN NYC, AS PART OF FINAL 6, TO COMPETE FOR

$1,000,000$10,000 TO SUPPORT STUDENT CASE COMPETITIONS & RELATED TRAVEL

TRADEPUBLICATIONS

APPEARANCESIN RELATED INTERVIEWS & NEWS ITEMS

ALEXANDER DYCKANDRÁS TILCSIK

1 CONFERENCE

3 PHD DISSERTATIONS

2 SSHRC GRANTS

3 NEW COURSES

91 ACADEMIC PRESENTATIONS

INSPIRING NEW THINKINGROGER MARTIN, ACADEMIC DIRECTOR 2014-2015

5PUBLICATIONS Alison Kemper and Roger Martin on “Cities are businesses’ best allies in the battle against climate change” in The Guardian Sustainable Business, October 14, 2014 | Roger Martin on “The Rise (and Likely Fall) of the Talent Economy” in Harvard Business Review, October 2014 | Roger Martin on “When Star Talent Grew More Powerful Than Capital” in HBR.org, September 9, 2014, also posted to The Huffington Post, September 10, 2014 | Roger Martin on “How to Win the Argument with Milton Friedman” in HBR.org, June 2, 2014 | Alison Kemper and Roger Martin on “All business leaders should consider the source of their electrical power” in The Guardian Sustainable Business, May 7, 2014

3PUBLICATIONS PENDING Roger Martin and Sally Osberg (CEO, Skoll Foundation) on “Two Keys to Sustainable Social Enterprise” in Harvard Business Review, May 2015. | Roger Martin and Sally Osberg, Getting Beyond Better: How Social Entrepreneurship Works, Harvard Business Press, published in October 2015 | Roger Martin and Alison Kemper, “The Overvaluation Trap: When Investor Expectations Are Impossible to Meet, Bad Behaviors Ensue,” Harvard Business Review, forthcoming December 2015

1WORK IN PROGRESSRoger Martin, Alison Kemper and Rod Lohin, Virtuous Capitalism: The Limits and Possibilities of Doing Good (book in development)

6 SPEAKING ENGAGEMENTSRoger Martin. Panelist on “The social responsibility of business is to increase its profit?” Conference on Inclusive Capitalism: Building Value, Renewing Trust. London, UK, May 27, 2014 | Roger Martin. Panelist on “Values at Work: Linking Purpose, Productivity, and Performance.” Aspen Ideas Festival, July 1, 2014 | Roger Martin. Panelist on “The Stock Market: It’s a Design Problem.” AIGA/Gain Conference on Redesigning Commerce: Changing the Face, Place and Character of Business, New York, October 24, 2014 | Roger Martin. Panelist on “Have We Reached a Turning Point? Learnings, New Perspectives and Call to Action,” Drucker Forum 2014 Conference on The Great Transformation - Managing our Way to Prosperity. Vienna, November 13-14, 2014 | Roger Martin. Conversation with Tim Brown and Josh Tyrangiel on “How design makes the world better, smarter, cooler, and more innovative,” Bloomberg Businessweek Design Conference, April 28, 2015 | Larry Summers (with Chrystia Freeland, Roger Martin and Time Barber), “On Economic Inequality,” April 6, 2015

LEE-CHIN INSTITUTE ANNUAL REPORT / 6

ALISON KEMPERSENIOR RESEARCH ASSOCIATE

ANDRÁS TILCSIKASSISTANT PROFESSOR, STRATEGIC MANAGEMENT AND FELLOW, LEE-CHIN INSTITUTE

ALEXANDER DYCKPROFESSOR, FINANCE & BUSINESS ECONOMICS AND FELLOW, LEE-CHIN INSTITUTE

GLEN WHYTEPROFESSOR, ORGANIZATIONAL BEHAVIOUR & HR MANAGEMENT AND MEMBER, GRANT REVIEW PANEL

SARAH KAPLANPROFESSOR, STRATEGIC MANAGEMENT AND MEMBER, GRANT REVIEW PANEL

YUE LIASSOCIATE PROFESSOR, ACCOUNTING AND MEMBER, GRANT REVIEW PANEL

ROD LOHINEXECUTIVE DIRECTOR

This is the annual report of the Michael Lee-Chin Family Institute for Corporate Citizenship for 2014-15. In this report we detail our activities and achievements of the past year and signal our plans for the coming year.

The purpose of the Lee-Chin Family Institute is to help business leaders – both current and future – integrate sustainability into business strategy and practices.

TO DO THIS, WE:

1. Conduct and publish dedicated research on sustainability theories, models, strategies and actions for academic and business audiences.

2. Support related academic research by Rotman faculty and PhDs

3. Disseminate our research and the leading thinking of others through events and the media

4. Enhance curriculum and co-curricular activities relating to sustainability.

OURIMPACTTHIS YEAR

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A core function of the Lee-Chin Institute is to help business leaders navigate sustainability challenges (and opportunities) facing businesses by developing and publishing theoretical and applied research. Since 2005, the Lee-Chin Institute has generated one book, five published academic articles, six working papers, and 12 trade publications. As well, the Lee-Chin Institute has produced 39 columns and blogs, delivered 42 presentations, and appeared in 95 related interviews and news items.

IN 2014-15, WE PUBLISHED: • Alison Kemper and Roger Martin on “Cities are

businesses’ best allies in the battle against climate change” in The Guardian Sustainable Business, October 14, 2014

• Roger Martin on “The Rise (and Likely Fall) of the Talent Economy” in Harvard Business Review, October 2014

• Roger Martin on “When Star Talent Grew More Powerful Than Capital” in HBR.org, September 9, 2014, also posted to The Huffington Post, September 10, 2014

• Roger Martin on “How to Win the Argument with Milton Friedman” in HBR.org, June 2, 2014

• Alison Kemper and Roger Martin on “All business leaders should consider the source of their electrical power” in The Guardian Sustainable Business, May 7, 2014

1.DEDICATEDRESEARCH

The Lee-Chin Institute encourages and supports sustainability research by Rotman faculty and PhDs.

Since 2005, the LCI has funded a growing pipeline of 62 funded academic research projects by Rotman faculty members and PhD students on sustainability topics. This pipeline has helped to produce one book, three book chapters, 21 academic journal articles, six submitted articles currently under review, 19 working papers, one conference proceedings, three PhD dissertations, two SSHRC grants, three new or upgraded courses, and at least 91 academic presentations.

LCI GRANT PRODUCTS:

2.SUPPORTRELATEDACADEMICRESEARCH

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 TOTALS

Book 1 1

Book Chapter 1 2 3

Conference Proceeding 1 1

Dissertation 1 1 1 3

Journal Article 2 1 7 1 3 2 1 1 3 21

Journal Article 2 1 2 1 6 (under review)

Presentation 4 22 4 9 2 13 18 5 11 3 91

SSHRC grant received 1 1 2

Trade Publication 1 1

Working Paper 1 1 4 5 2 1 3 2 19

TOTALS 7 27 12 11 11 23 23 8 16 10 148

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In 2014-15, the Lee-Chin Institute awarded grants supporting research in sustainability by Rotman faculty and PhDs for 2015-16. Grant recipients were selected by a panel of Rotman academics and Institute staff (including Glen Whyte, Sarah Kaplan, Yue Li, Rod Lohin and Alison Kemper). The recipients were: • Andrew Ching (Associate Professor of

Marketing) and Jinghui Qian (PhD Candidate, Marketing), “The Role of Corporate Social Responsibility Activities in Retail Chain Expansion: Evidence from Walmart.”

• Laura Doering (Assistant Professor of Strategic Management) and Sarah Thebaud (Assistant Professor of Sociology, University of California at Santa Barbara), on “Beyond Relational Lending: Interpersonal Ties and Gender Expectations in Commercial Microfinance.”

• Carlos Inoue (PhD Candidate, Strategy) and Anita McGahan (Rotman Chair in Management and Professor of Strategic Management, “Law and Sentiment: Privatization of Public Services in the US 1992-2012.”

• Nan Li (Assistant Professor of Accounting, UTS/Rotman), “Corporate Social Responsibility and Wage Differential.”

• Hadiya Roderique (PhD Candidate, Organizational Behaviour & HR Management) and Tiziana Casciaro (Associate Professor of Organizational Behavior and HR Management), “Improving the Selection of the ‘Other’: An Examination of the Barriers to Female Mentorship in Corporate Organizations.”

• Wally Smieliauskas (Professor of Accounting) and Wuyang Zhao (PhD Candidate, Accounting), “Do Same-Sex Marriage Laws Benefit LGBT Friendly Companies?”

• Jin Wan (PhD Candidate, Marketing) and Pankaj Aggarwal (Associate Professor of Marketing, UTSC/Rotman), “To Trace is to Trust: Consumers’ Response to Product Traceability.”

In 2014-15, we announced two new Fellows of the Lee-Chin Institute for 2015-16. Fellows are chosen to support and honour their work relating to sustainability topics for a one-year term.

THIS YEAR’S FELLOWS ARE:

Alexander Dyck (Professor of Finance and Business Economics and ICPM Professor in Pension Management), a distinguished senior Rotman scholar and teacher whose primary work for the Institute is the project “Do Institutional Owners Drive Adoption of Corporate Social Responsibility?” exploring whether institutional ownership has played a causal role in driving firm adoption of increased environmental and social governance.

András Tilcsik (Assistant Professor of Strategic Management), a rising scholar and teacher at Rotman whose work for the Institute includes two projects: first, “Environmental Catastrophes: Prevention and Mitigation” to identify corporate practices and decision-making processes that reduce the risk and impact of environmental disasters; and second, “Remedies for Employment Discrimination” to provide practical advice on how organizations can ensure equal opportunity in their hiring.

The Lee-Chin Institute also offered support to Rotman discipline areas to encourage/help bring in visiting scholars whose work relates to sustainability. This year, Business Economics hosted Professor Etienne de Bettignies, Queens University (March 9, 2015) on economic modelling for corporate responsibility.

3.DISSEMINATERESEARCHTHROUGH EVENTS & MEDIA

MEMBERS OF OUR TEAM APPEARED AT THE FOLLOWING SPEAKING ENGAGEMENTS:

• Roger Martin. Panelist on “The social responsibility of business is to increase its profit?” Conference on Inclusive Capitalism: Building Value, Renewing Trust. London, UK, May 27, 2014

• Roger Martin. Panelist on “Values at Work: Linking Purpose, Productivity, and Performance.” Aspen Ideas Festival, July 1, 2014

• Roger Martin. Panelist on “The Stock Market: It’s a Design Problem.” AIGA/Gain Conference on Redesigning Commerce: Changing the Face, Place and Character of Business, New York, October 24, 2014

• Roger Martin. Panelist on “Have We Reached a Turning Point? Learnings, New Perspectives and Call to Action,” Drucker Forum 2014 Conference on The Great Transformation- Managing our Way to Prosperity. Vienna, November 13-14, 2014

• Rod Lohin, Panelist at Rotman Net Impact Sustainability Dinner, March 10, 2015

• Roger Martin. Conversation with Tim Brown and Josh Tyrangiel on “How design makes the world better, smarter, cooler, and more innovative,” Bloomberg Businessweek Design Conference, April 28, 2015

The Lee-Chin Institute is continuously building profile about sustainability issues and approaches through presentations, publications and media profile for business and academic audiences.

THIS YEAR, THE LEE-CHIN INSTITUTE SPONSORED OR HOSTED 5 EVENTS, WITH MORE THAN 544 REGISTRANTS:

• Barbara Anderson, CFO, Toronto PanAM Games, “Toronto Pan Am Games and their Legacy after 2015.” Corporate Citizenship Speaker Series, April 3, 2014 (121 registrants)

• Tom Rand, Managing Partner, MaRS Cleantech Fund, “Solutions For Our Climate Change Paralysis” Tackling Wicked Problems Speaker Series, October 1, 2014 (102 registrants)

• Dr. Paul E. Garfinkel, Professor, Department of Psychiatry, University of Toronto; Staff Psychiatrist & former CEO, Centre for Addiction & Mental Health (CAMH); “Narcissistic Character and the Workplace.” Mental Health in the Workplace Experts Speaker Series, October 23, 2014 (100 registrants)

• Hult Prize, a social entrepreneurship competition at University of Toronto, December 6, 2014 (106 registrants plus 7 volunteer judges)

• Net Impact CSR Case Competition, Rotman School of Management, January 31, 2015 (90 registrants plus 18 volunteer judges)

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To ensure that students and others who want to learn more about sustainability have appropriate educational experiences, the Lee-Chin Institute has taken a leadership role in coordinating curriculum development and building new co-curricular experiences at Rotman.

In the Spring of 2015, we developed the Sustainability at Rotman Working Group to engage students, faculty and staff in building a stronger sustainability activities at the School. By the end of the year, the group grew to 45 members.

THE GROUP IDENTIFIED THE FOLLOWING PRIORITIES:

Curriculum: A stronger sustainability curriculum (core and elective)

Co-curriculum and careers: More/better sustainability co-curricular and career offerings, including ways to engage the business community

ROI and business case: A clearer sustainability position for the School (built on a better understanding of where we stand now and our goals)

Walking the talk: Greater presence of sustainability in Rotman building/operations/life/culture.

Based on the priorities established by the Sustainability at Rotman group, we emphasized work on the curriculum, in particular, a new Rotman major in Sustainability. Faculty – and Sustainability at Rotman group – members Glen Whyte and Laura Doering played instrumental roles in the development of a new major, and our target is the launch of the new major in June 2015.

The Lee-Chin Institute also supports student initiatives relating to sustainability. This year, we worked closely with Rotman Net Impact (the Rotman Chapter of an international organization of MBA students interested in sustainability). We sponsored inaugural year of the Hult Prize at the University of Toronto, organized by Rotman Net Impact, December 6, 2014. Team Attollo, largely made up of Rotman Morning MBA students, won and went on to the Semi-Finals in Dubai, where they also won, and will compete in the finals in New York in the fall of 2015.

We also sponsored the Rotman Net Impact CSR Case Competition, January 31, 2015, with 16 teams and 20 judges and volunteers.

The LCI also supported student travel, providing funds to help students travel to sustainability case competitions or conferences. These funds were principally used to subsidize student travel to 3 Hult Prize semi-finals in Dubai, San Francisco and Shanghai.

4.ENHANCE THE CURRICULUM & CO-CURRICULAR ACTIVITIES

MEMBERS OF TEAM ATTOLLO

The work of the Lee-Chin Institute is accelerating. We’re producing and supporting more research, engaging more business leaders, academics and students than ever before through our publications, events, media coverage, and curricular development.

This year, the Lee-Chin Institute’s research will focus on three themes: sustainability strategy, social entrepreneurship and social finance. This includes work on a new sustainability strategy book by members of the Lee-Chin Institute team on Virtuous Capitalism: The Limits and Possibilities of Doing Good. Social entrepreneurship and social finance will be explored further in our research in the following publications:

• Roger Martin and Sally Osberg (CEO, Skoll Foundation) on “Two Keys to Sustainable Social Enterprise” in Harvard Business Review, May 2015.

• Roger Martin and Sally Osberg, Getting Beyond Better: How Social Entrepreneurship Works, Harvard Business Press, published in October 2015

• Roger Martin and Alison Kemper, “The Overvaluation Trap: When Investor Expectations Are Impossible to Meet, Bad Behaviors Ensue,” Harvard Business Review, forthcoming December 2015.

We will continue work on new academic and trade press publications and anticipate publications in the Harvard Business Review and The Guardian Sustainable Business this year.

5.THE LEE-CHININSTITUTEIN 2015-2016

We will also reach out to a number of potential corporate clients to apply our models and tools. In particular, we started discussions with the RBC Financial Group to help them investigate “social finance” and work is due to begin in the summer of 2015-16.

Our support for sustainability research by other Rotman faculty and PhDs has grown and with it the remarkable output of all those who have already received grants. This year, we welcome Alexander Dyck and András Tilscik as our new Lee-Chin Institute Fellows.

The Sustainability at Rotman Working Group will play a key role in helping Rotman build a stronger sustainability position. In particular, an important focus for the coming year will be to boost the sustainability curriculum at Rotman. We anticipate a new sustainability major in the MBA programs in 2015 and hope to influence the core curriculum in an expected review in 2015-16.

We will encourage and support more sustainability events for the business community and students. As well, we will support the ongoing growth of student organizations like Rotman Net Impact and their key activities (the Rotman Net Impact Case Competition and the Hult Prize).

Overall, through the work of the Lee-Chin Institute and in coordination with faculty and students, we will strengthen the position of Rotman as a thought leader on today’s critical management issues.

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In the coming year, the work of the Lee-Chin Institute will achieve even greater presence and impact. We’re producing and supporting more research, and engaging more academics, students and business leaders than ever before through our publications, events, media coverage, and curricular development. As the field of sustainability burgeons, our research will focus on three themes: sustainability strategy, social entrepreneurship and social finance.

ROD LOHIN Executive Director Michael Lee-Chin Family Institute for Corporate Citizenship

Tel: 416-978-3458 Fax: 416-978-5433Email: citizenship@rotman.utoronto.ca LinkedIn: Sustainability at RotmanTwitter: @Lee_Chin_Inst