“The world has a golden opportunity to build back boldly after the pandemic and put gender equality, social responsibility, and environmental protection at the heart of the recovery. With a deliberate and strategic focus on these issues, the future we sow could be more bountiful than the past.”
“For all the excitement about corporate ‘stakeholders’ and ‘purpose-driven’ firms, the new mode of capitalism is simply a repackaging of the old. Successful companies will continue to focus on the value of their shares over the long term, while avoiding the risks of wading into areas where they don’t belong”, argues Raghuram Rajan.
“Major signs of a new era! At the same time, the question remains how strong this wave of financial and economic innovation is. And where can a different kind of economy really take shape? In the US, the strong but wing-limp country beyond the ocean for many years? In China, where individual freedom is the key to every budget? This is where Europe comes into play, next to the US the largest economy in the world.”
Both professor Collier and professor Rajan argue that communities have collapsed over the last decades. […] how do we expect these new communities to develop? Or in other words, what is our theory of change? It seems to me there are three possible answers to this question, or a combination of them.
Environmental concerns were dominating many conversations at the business meetings Davos in 2019, but with climate-sceptic leaders ruling some of the world’s biggest economies, should we rely on companies to make the world a better place? Marieke Blom, chief economist of the Dutch bank ING, thinks not. A viewpoint submitted to the Future Markets Consultation.
The financial crisis of 2008, when Lehman Brothers went bankrupt, caused all kinds of financial and economic problems in the United States and Europe. Things became stable after a while, but prices of houses and stocks have been breaking new records. Is the financial crisis something of the past or a problem which is going to repeat itself? And if so, how can we prevent this from happening? A viewpoint from the Sustainable Finance Lab.
“Rio Tinto blasted into oblivion the caves of the Juukan Gorge, a 46,000-year-old Aboriginal sacred site in the Pilbara region of Western Australia, where the company mines iron ore. Rio Tinto did this in the pursuit of further expansion and in full knowledge of the site’s existence and importance. Not to proceed, the CEO has explained, would have cost the company $135 million. He was under pressure to maximize profits from iron ore. […] A stakeholder focus has been endorsed by none other than the U.S. Business Roundtable. […] But until companies like Rio Tinto start putting their metrics where their mouths are, I’m afraid to say that we are going to see more scandals like Juukan Caves.”
“The best way to address climate change is not through wishful thinking but by using the tools we have – and that includes the established corporate model of maximizing shareholder value. Already, many companies are showing the way, having recognized that going green can generate immediate profits,” writes Rebecca Henderson.
“Though investments in renewable energy and green infrastructure are necessary for building a sustainable world, they are not sufficient. Barring an overhaul of the global financial and monetary system, humanity will keep stumbling from one massive, destabilizing crisis to the next,” writes Ann Pettifor.
“Although it can be politically expedient to draw a thick line between capitalist decentralization and socialist central planning, the truth is that these two systems have converged on many occasions. Moreover, each was conceived for the same purpose, and elements of both could be realized in today’s digital economy.”
The recording of our live cast on ‘the future role of business as a force for good’ (28 September) with economist Rebecca Henderson and management scholar Colin Mayer is now available, as is a short written summary of the dialogue by Eefje de Gelder. The interview with Henderson and the interview with Mayer, part of the episode, are also available as separate videos.
Why is big business devoid of ‘purpose’? I would say it is because they tend to be disconnected from meaningful contexts; they are places of nowhere; they are system-oriented instead of relations-oriented; they are disembedded. Injecting abstract principles of purpose will not suddenly turn this around. If we want business to contribute to a better society and the greater good, I would like to suggest two lines of action.
We Can Build a More Inclusive Government and Economy out of the Pandemic — This Blueprint Shows Us How
“With the country facing an uncertain economic future, the University of Sydney’s Policy Lab has brought together community and climate groups, unions and business groups to identify strategies for creating a different way of making policy and building a new economy coming out of the crisis. The product is our ‘Real Deal’ report released this week.”
The Economics of Belonging: A Radical Plan to Win Back the Left Behind and Achieve Prosperity for All
“In The Economics of Belonging: A Radical Plan to Win Back the Left Behind and Achieve Prosperity for All, Martin Sandbu seeks to address the extent to which many citizens of western democracies feel ‘left behind’ by recent economic changes, proposing a detailed plan for creating a just economy where everyone can belong. While finding this a highly readable and carefully argued book that offers a number of persuasive policy prescriptions, John Tomaney questions whether it provides a fully convincing programme for the left-behind.”