Have there been ways in which globalization to date has failed? Absolutely. But it's worth acknowledging the progress we have made. Huge progress. Having said that, it's time to work on making sure that more people's lives improve as a result of globalization.
Why trust matters
So how can we spread economic growth more evenly? I believe this is a key issue of our time.
This will define the success of Globalization 4.0. And while government has responsibility and obligations in terms of policy, business and business leaders have an active role to play.
Trust is at the heart of people's relationships with businesses and governments. But there has been an erosion of public trust in these institutions in recent years. According to the 2018 Edelman Trust Barometer, the number of countries dubbed “distrusters” – where less than 50% of the general population trust “the institutions of government, business, the media and non-governmental organizations (NGOs)” – is now 20 of 28.
Almost two-thirds of participants said they wanted businesses and CEOs to speak out on policy and step up to be agents of change, instead of expecting government to instigate it. I believe this is in response to leading companies taking action. These include consumer product companies that are focusing on sustainability and tackling quality and environmental issues in their supply chains, tech companies getting involved in education and actively seeking a more diverse talent pool, and energy companies working with housing developments to implement microgrids.
However, I also believe that responsibility for inclusive growth is not down to government or up to business. It is the responsibility of us all: citizens, businesses, academics, regulators and governments.
Three ways to improve inclusiveness
So where do we start? How can we create a business environment that allows people to thrive? I think there are three priorities:
1. Focus on the big questions at a global level
When is it acceptable to clone animals or humans? Should driverless cars be programed to value the lives of many over the life of the driver? Should robots have rights? How do we decide which biases to strip out of AI algorithms?
Questions like these have moral and ethical ramifications beyond national borders. Ultimately, AI will be used globally, it will require global norms and standards for people, governments and businesses to follow. And as AI continuously evolves, it will need an ongoing and rigorous system of checks, processes and controls. Developing these will take the best scientific, technological, academic, legal, political and business minds working together. We've seen a few starts but this is an urgent priority before the genie is out of the bottle.
2. Educate and train people, so they can navigate through the impact of automation
Much has been published about the impact of automation on jobs and the need for more digital skills in both current and future generations. But altering national approaches to education requires public trust in the government's vision of the future, not to mention an enormous amount of political will, negotiation and money. So will people spend money on edtech to give their children what the schools aren't? Something needs to change.
Businesses and governments need to create new strategies and opportunities for people whose jobs are affected by automation. Reskilling and training is essential to give people the tools they need to flourish, and to adopt a mindset of lifelong learning. I believe the best future will be humans and machines working alongside each other but that won't happen by default. We need to invest and plan for it.
3. Focus on the long-term and sustainability
Profit is quick to recognize short-term changes in revenues and costs but what about investments made for the long-term? My last blog explored how we could update financial reporting to reflect long-term value. Right now, a company's investments in innovation, environmental and social impact or strong governance are real competitive assets that don't show on the balance sheet. It's time to correct this.
What’s possible in the Transformative Age? Join EY to discuss this and all the pressing economic and social issues as we look to the World Economic Forum Annual Meeting 2019 ― from 22-25 January. Join the debate via ey.com/wef and using #WEF19 and #BetterWorkingWorld.