By Jaan Elias
For the 10th year, the Yale Case Research and Development Team (CRDT) debuted a case study for the Aspen Institute Business & Society International MBA Case Competition. This year’s case study focused on the Connecticut Green Bank’s efforts to rebound from a severe cut in its funding.
The Executive Director of the Aspen Institute Business & Society program, Judy Samuelson ’82, announced the winners at a gala breakfast awards ceremony held at the Yale Club in New York City on April 26. Connecticut Governor Ned Lamont ’80 gave the keynote address to nearly 200 attendees.
Twenty-three business schools from across the globe participated in the competition. The team from Boston University’s Questrom School of Business won the top prize of $15,000. The Isenberg School at UMass Amherst took second and a $7,500 prize. NYU Stern placed third. (Yale SOM students do not compete since the school supplies the case study.)
In his keynote, Lamont recognized the importance of the Green Bank to the state and pledged, to considerable applause, his support of the organization in the future.
Lamont acknowledged that Connecticut had experienced “a wake-up call” with the departure of General Electric’s headquarters. He cited his new administration’s efforts to repair the state’s business development efforts by enlisting the efforts of Jeffrey Sonnenfeld, Lester Crown Professor in the Practice of Management and senior associate dean for leadership studies at Yale SOM, and former PepsiCo CEO Indra Nooyi ’80.
In the absence of national leadership, the governor urged management students to consider working in state governments, “the laboratories of democracy.” Lamont said that students could put their skills to work and gain considerable responsibility for tackling significant problems related to areas like climate change and inequality.
In his remarks, Connecticut Green Bank (CGB) CEO Bryan Garcia thanked the competitors for their “spot-on analysis” of the Green Bank’s current situation. He noted the importance of training people who were comfortable in both the private and public sectors. CGB’s success, he observed, was due in large part to finding talented executives able to bridge the public-private divide.
The CRDT case study on the Green Bank that served as the basis of this year’s contest was funded in part through the support of the Jane Mendillo ’84 and Ralph Earle SOM ’84. Earle and Mendillo also served as part of the judging panel for the Aspen Competition.
As the case documents, the Green Bank’s existence and work is closely intertwined with Yale.
In 2011, the Connecticut legislature chartered the Green Bank as a quasi-public agency based on a proposal Dan Esty, a Yale Professor and then Commissioner Connecticut’s Department of Energy and Environmental Protection. Esty argued that establishing a green bank would allow using an existing surcharge to leverage private dollars for renewable energy projects. Garcia, then the director of the Center for Business and Environment at Yale (CBEY), agreed to serve as the CEO of the new bank.
In its first six years, The Connecticut Green Bank had been very successful, managing to:
- leverage six private dollars for every public dollar invested;
- induce over a billion dollars of gross investment;
- generate hundreds of megawatts of renewable energy that prevented 4.6 million tons of CO2 from being released into the atmosphere.
In July of 2017, the Harvard Kennedy School of Government gave the bank its prestigious Ash prize in policy innovation. The prize acknowledged that Connecticut’s first-in-the-nation green bank had sparked the founding of similar institutions throughout the United States.
However, in 2018, the Connecticut Legislature faced a huge budget deficit. In its final budget, the legislature raided the surcharge that was the backbone of the CGB’s funding and allocated half to the general fund.
In response, the Green Bank restructured its operations with an eye to self-sufficiency. Rather than concentrate solely on leveraging private dollars with public subsidy, the Green Bank now required that its investments return at least five percent over a 10-year period for the bank itself. In addition, the Green Bank spun off a nonprofit called Inclusive Prosperity Capital to take over programs that aided low- to moderate-income households.
The case assignment for this competition had students propose a program that satisfied the environmental objectives of the Green Bank while meeting the bank’s hurdle rate and to come up with a strategy for Inclusive Prosperity Capital that would allow it to achieve its goals.