The last time the World Economic Forum (WEF) met in Davos, it felt like we were living in a very different world. Back in January 2020, we were yet to experience a global pandemic and the idea of a war in Ukraine was almost unthinkable. While rising energy and food prices might have been foreseen by some, the potential scale of the impact on business and society was not at the top of the agenda. It now is.
Yet, as we gather for the first in-person WEF since 2020, there are also grounds for optimism and hope. That’s because crises can bring people together as well as set them apart. To give one example, while the immense task of addressing climate change can create a sense of fear and hopelessness, it is also galvanizing action and inspiring new forms of co-operation.
The need for collaboration is a key theme that I’m looking forward to exploring and putting into practice further at the forum as I meet with business leaders, non-governmental organizations (NGOs) and politicians.
Depending on each other
While COVID-19 highlighted divisions through its disproportionate impact on the most disadvantaged, it also revealed just how much we all rely on each other. In the UK, the interdependency between businesses and their customers, employees, suppliers and the communities in which they operate was clear to see. It quickly became evident which companies stepped up to the plate and which lacked purpose or failed to deliver on it.
The pandemic confirmed my long-held belief that a successful business must deliver for all its stakeholders. Only by working for and with its stakeholders can a business deliver the long-term value that both society and investors increasingly expect. In that context, WEF was the first organization to defend the idea of stakeholder capitalism way back in 1973 – but perhaps it takes a crisis to crystallize it.
Putting theory into practice
Now, as economies seek to recover after COVID-19, while also facing supply chain bottlenecks, labor shortages and the impact of the war in Ukraine, the interconnected nature of the challenges is clear.
The level of change being faced by UK companies is also unprecedented, as their markets adjust, and new technologies come online. Here, the collaboration takes a different form, as businesses increasingly seek out new organizations to work with and the capabilities needed to not only survive but thrive.
In perhaps the biggest challenge of all, addressing climate change, it is abundantly clear that no one leader, business or country can succeed on their own.
Ultimately, creating a sustainable future requires all of us to be at the table. It demands involvement across borders and business functions, as well as between governments and industries. That means getting business and government leaders together again, which is why being able to connect in-person at Davos is all the more important.
Playing our part
Collective and collaborative action often starts at home. Only by putting your own house in order can you be a good leader and enabler of change.
We recognize that transitioning to a net zero economy will take a collective effort. So, we have leveraged our role as convenors. Our Climate Business Forum brought together 11 of the UK’s biggest companies with a group of young future leaders to help develop a clear action plan for any business piloting a practical path toward net zero. Our crucial role in the North Sea Transition Deal ̶ where we are collaborating with the UK government, the oil and gas industry and leading technology firms ̶ is also expected to lead to a cut in carbon emissions by up to 60 million tonnes by 2030 and support up to 40,000 jobs across the supply chain.
Behind the headlines, we are working to put in place the common standards and assurance that prevents greenwashing and gives capital markets the confidence they need to finance a green future. Again, that requires collaboration. In this case, we are working alongside other professional services firms to create the International Business Council sustainability metrics.
Acknowledging that new standards also bring new pressures, we launched a new business – EY Carbon – this year, to help companies prepare for new UK rules that will require independent scrutiny and verification of companies’ net zero plans. Our recent announcement, that we intend to double the size of our UK and Ireland consulting business by 2025, also recognizes the demand from clients for our help as they tackle such challenges.
