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Citizen today, April 2011 - Cities for citizens - EY - Global

Citizen Today, April 2011

Cities for citizens

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The priority given to sustainable development by today's civic leaders is one of the most striking outcomes of our research.

Mapping the future

Get ready for urban growth. In 1950, only 29% of the world's population were urban dwellers. By 2050, the United Nations predicts that number will grow to 69%.

More is now depending on the decisions taken by city leaders than ever before. But what are today's generation of mayors and their deputies thinking?

Our Government & Public Sector teams interviewed more than 70 city leaders from around the world, including mayors, chief executives and their implementation teams, to uncover their ambitions and targets as well as their their challenges and priorities.

We take a closer look at those conversations across the following topics:

State of cities

Globalization has caused cities all over the world to be more connected than ever.

As capital and people move freely, city leaders are now striving to attract talent and investment, and to provide a sustainable, vibrant community for their citizens to live, work and play.

Yet at this time of intense competition, resources are increasingly scarce. The degree of financial resources a city can secure from its citizens, the governance hierarchy, donors and investors is dependent on a number of factors. These include the population size and migration into and out of the city's borders.

The success of a city leader's strategy will be shaped by the current state of the city and its leadership.

But while each faces a unique mix of multiple and competing stakeholders, there are common ways to increase a city's attractiveness:

  • Introduce powerful, accountable leadership and governance
  • Build stakeholder confidence through delivery
  • Harness popular support and drive change
  • Embrace the future and step ahead

However, it is vital that these actions are backed by robust analysis and insight in order to sell the vision to all stakeholders and harness the resources to make it happen.

Survey results

Our survey found the following themes among city leaders.

Vision

The city leaders we spoke to gave an eclectic mix of motivations for taking their jobs. It is interesting to note that fewer than 10% gave answers that could be seen as furthering their own political careers.

As for their vision for the city, tackling social inequality and reinventing their city as a global center of excellence shared top billing. These targets were then followed by sustainability and economic development.

We also asked what these leaders wanted their cities to be famous for 10 years hence and received a range of personal commitments.

Strategy

Mayors and their deputies noticeably spilt in their answers to the question "How on track are you to successfully delivering the current strategy?"

The mayors are clearly more optimistic, reflecting their tendency politicians to be less risk averse than public servants, who were more cautious in their responses. For example, some 50% of mayors said they were between 51% and 75% in terms of their progress, whereas only 32.4% of deputies shared this assessment.

According to our research, the key activity supporting these strategies is infrastructure and environmental improvement, with 66.7% of our respondents citing this as a key priority. This was followed by building a city brand (57.8%).

We believe that robust financial management is critical to the successful execution of policy priorities, as well as the day-to-day running of a city. Managing resources effectively and striking a fine balance between income and expenditure requires a high degree of competency and capability, similar to a well-run corporate organization — except in this instance the shareholders are citizens.

How will these plans be funded and where does the current budget come from? Survey respondents said the sources are, from largest to smallest:

  • Citizen taxation
  • National governments
  • Business taxation

Environment Champions (UK)

In order to encourage a green mindset in EY's people, our UK firm has enlisted the help of volunteers in every one of its offices to act as "environment champions" who educate their peers about leading practices and behavior change relating to reducing waste and energy use, and reducing travel miles.

Sustainability and economic development

84% of respondents said they have a specific sustainable development policy in place. These activities include:

  • New transportation systems (86%)
  • Emission reductions (78%)
  • Energy reductions (70%)
  • Renovation of existing buildings (70%)
  • Green promotion campaigns (65%)

These results underline how many cities, and indeed many countries, have come to view green jobs as a central part of their economic recovery plans. Increasingly, they believe that a competitive advantage can be gained by developing a city knowledge base to leverage into other markets.

City issues

Wherever a city is located, its leaders have been tapping into support from national governments and financial institutions in a bid to restore fiscal strength.

We looked at what city leaders see as their most pressing and challenging policy areas. Economic progress and development emerged as a key priority.

However, the diversity of responses showed how important it is for a mayor to pull together a team of like-minded experts to deliver their priorities.

Governance, accountability and stakeholder engagement

26% of city leaders in our survey are not directly elected, 31% of respondents do not elect local/district councils, and 51% do not utilize community action committees.

When asked who held them to account — a board of directors, an executive committee, an elected legislature and citizens — it was surprising to find out that only 71% — and not 100% — of respondents stated they were held to account by citizens.

Such a finding serves to highlight the diversity that courses through city systems — wherever their geographic location.

What do these results mean?

Seven key insights emerged from our survey:

  1. Competition for resources is global, not local, because people and capital are highly mobile.
  2. The respective size of a city is not important; all have the capacity to deliver a vision and attract resources, and in doing so become the best that they can be.
  3. Many cities and national governments continue to face intense funding difficulties as a result of the financial crisis.
  4. A world-class financial management capability is essential.
  5. Some cities have pinned their hopes on large infrastructure projects; to kick-start economic activity, and to attract business, investors and talent.
  6. Cities need to prioritize the allocation of resources to meet strategic goals is needed and think innovatively about service design and delivery models.
  7. Investors and donors, as well as businesses and citizens, will expect city leaders to ensure that maximum stakeholder value is assured.


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