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What changes to economic systems will 2021 bring? Here’s what business leaders say

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People join fast-food and nursing home workers during a "My Vote is Essential" rally before casting their early ballots, amid the coronavirus disease (COVID-19) concerns at Wayne County Community College in Detroit, Michigan, U.S., October 24, 2020.  REUTERS/Emily Elconin - RC26PJ9M0LAO

Policies need to shift so that economies make sustainability and social inclusion central to how they function. Image: REUTERS/Emily Elconin

Gayle Markovitz
Acting Head, Written and Audio Content, World Economic Forum
Samantha Sault
Writer, Washington DC and Geneva
This article is part of: The Davos Agenda

With more than 2 million COVID-19 deaths worldwide and rising, getting the virus under control is a top priority for 2021.

However, full recovery is dependent not only on addressing the health crisis, but also the long-term economic impacts – and in an equitable, inclusive and sustainable way.

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“Facing the ongoing public health crisis of COVID-19 and the pandemic’s lasting effects on the global economy, policy-makers around the world must take this moment to reflect not just on the immediate recovery, but on how this time can be used to transform their economic systems,” wrote the Forum’s Managing Director Saadia Zahidi.

“Growth and productivity alone are not enough, without addressing inequality and the environment. There is a need to shift policies so that economies make sustainability and social inclusion central to how they function,” she continued.

The Davos Agenda is mobilizing global leaders to work together virtually to achieve a more inclusive, cohesive and sustainable future as soon as possible. An entire week of global programming is dedicated to helping leaders choose innovative and bold solutions to stem the pandemic and drive a robust recovery over the next year – with Day 1 (25 January) focused on how we can design cohesive, sustainable and resilient economic systems.

Ahead of the meeting, we invited World Economic Forum Strategic Partners to share ideas on how to create fairer economic systems.

‘Invest in long-term growth and resilience’

Yousef Al-Benyan, Vice Chairman and CEO, SABIC

In 2020, the pandemic disrupted the global businesses, society and governments. It has initiated and, in many cases, accelerated key structural changes that will impact our businesses and economy for many years to come. As we lived through the pandemic, the industry moved very fast to adopt new ways of solving pressing problems in real-time. We must leverage this in 2021 to address the challenges and capitalize on exciting opportunities and fundamentally change our approach on how we lead and continue to invest in long-term growth and resilience that is environmentally sustainable and socially inclusive.

Global Risks Horizon - Global Risks Report 2021
These are the risks that pose the biggest threat to the world in 2021. Image: World Economic Forum

‘Radical collaboration’

Carmine Di Sibio, Global Chairman and CEO, EY

Vials containing doses of the Pfizer-BioNTech COVID-19 vaccine are seen at the Bavarian Red Cross vaccination center, in Pfaffenhofen an der Ilm, Germany January 10, 2021. REUTERS/Andreas Gebert - RC225L9J5BMJ
The Pfizer-BioNTech vaccine is an example of what we can achieve with collaboration. Image: REUTERS/Andreas Gebert

I have been heartened by the resilience, innovation and dynamism I’ve seen over the course of 2020 as so many people, businesses and communities struggled to navigate the challenges. In many cases, what we found, is that when we work together, contribute our skills and insights to the challenge before us, we make progress. Radical collaboration (even among competitors) can address problems, create societal value and spur innovation.

COVID-19 vaccine development is one great example. We can bring this spirit of partnership to other critical issues – economic inequality, climate change, education and social justice.

In 2021, I think creative collaborations will be in demand – as businesses, community/academic organizations and governments seek diverse thinking and new approaches to enduring social, economic and political issues.

‘Transform quickly and effectively’

Simon Freakley, CEO, AlixPartners

In the midst of one of the most profound public health and economic crises the world has ever experienced, we saw just how quickly business could transform when necessary. New platforms for remote working and digital commerce, which had been slated to take years, were adopted within weeks.

Supply chains and distribution channels were adjusted to maintain the delivery of critical products and services. And, of course, there are the heroic efforts by pharmaceutical companies to develop, test, manufacture, and distribute vaccines at record pace, which will ensure an eventual end to this crisis.

If businesses can transform quickly and effectively in the face of COVID-19, they can also do so when confronted with the challenges from disruption. In an interconnected world, the success of these efforts reverberates beyond any one business and their stakeholders. It supports societies and communities by building a long-term and sustainable future for many through the virtuous cycle of innovation, job creation, and economic growth.

But the time to define this future is today.

‘Double down on collaboration’

Aaron Karczmer, Chief Risk Officer and EVP, Risk and Platforms, PayPal

This past year was extraordinary, from the unprecedented challenges, to the remarkable ways in which groups came together to respond in a more equitable and inclusive manner. Multi-sector partnerships have, for some time, provided an effective model to address critical gaps, but moving forward into the broad global recovery of 2021, we must rethink the way we work together and double down on collaboration.

Challenges requiring innovative solutions range profoundly – from promoting physical health and mental well-being, to catalyzing economic recovery and empowerment, and even refortifying cyber safety and security in the accelerating digital world. To drive positive change, all sectors must recognize this opportunity to create a new collaborative paradigm, raise the stakes of participation by bringing all assets to bear, and provide each other accountability. Creating this new paradigm may be the only way we can effectively meet our scale of need with the necessary scale of impact.


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'Be prepared to respond effectively, creatively and collaboratively'

Carolina Klint, Managing Director, Marsh

This capability to act with single-minded purpose needs to be institutionalized – the pursuit of national and global resilience is bigger than any one organization and any one risk.

More collaboration across society – the public and private sectors, communities, and NGOs – is essential. It will involve developing stimulus programs that incentivize sustainable recovery efforts that include green infrastructure and clean energy projects. It will require partnerships between the public and private sectors to upskill workers for an exploding digital economy. And it ought to necessitate the creation of new pandemic and emerging risk insurance mechanisms that could help stabilize companies during extended crisis events.

To build and maintain resilience, it is important that business keeps an eye on potentially high impact events in the short-term and on the longer-term landscape. And then be prepared to respond effectively, creatively and collaboratively. This is vital for businesses and the global community to sustainably navigate the risks and opportunities ahead, strengthen their resilience to future shocks and progress towards long-term prosperity.

Private companies must ‘be at the heart’ of recovery

Shunichi Miyanaga, Chairman of the Board, MHI Japan

While we will still need to cope with the continuing threat of COVID-19 by increasing vaccine production and improving therapies and medications, 2021 will be the year the world starts its recovery from the social and economic damage caused by the pandemic. This recovery will, however, be in different directions and at a different pace for each society, each economy and each industry.

In order to overcome the pandemic’s vast and grave damage, we – private companies – should be at the heart of the movement. By integrating our collective cutting-edge technologies and industrial expertise with experience addressing past disasters and far-reaching global issues, we can chart a course to a more sustainable and equitable recovery. We also need to closely and diligently work with governments to secure a healthy foundation for society, and to focus on the immediate recovery while maintaining well balanced long-term growth potential, particularly in fields with challenging technological, industrial and societal goals such as decarbonization.

Threats prioritized for business action all relate to three socio-economic systems
Private companies can have an impact on climate change – here's how Image: World Economic Forum

‘Harness the spirit of adaptability, ambition and collective endeavour’

Noel Quinn, Chief Executive, HSBC

Rodrigue Kauahou, a worker of the installation company Alromar, sets up solar panels on the roof of a home in Colmenar Viejo, Spain June 19, 2020. Picture taken June 19, 2020. REUTERS/Sergio Perez - RC2HPH9UOQOH
Sustainable infrastructure, clean technology and renewable energy are the next high-growth sectors. Image: REUTERS/Sergio Perez

The past year has shown that there is great power in people working collectively to find solutions to common problems.

Whole industries and professions have proven to be much more adaptable than many anticipated, proving again that the most challenging times often lead to the greatest innovation. This should encourage much greater ambition in re-building a dynamic, sustainable global economy.

We have all been concerned, and humbled, by the fragility of the world in 2020, but we should move forward with optimism. The arrival of multiple vaccines means that large parts of the global economy should be able to reopen soon. There is also real momentum behind the push to make our economies more resilient and sustainable to protect against future crises, while protecting the communities left behind. Sustainable infrastructure, clean technology and renewable energy are the next high-growth sectors.

If we can harness the spirit of adaptability, ambition and collective endeavour we witnessed in 2020, we have all the tools at our disposal to build a lasting and sustainable recovery.

‘Plan a stable, sustainable economic recovery for all’

Jes Staley, Group CEO, Barclays

We can’t begin planning early enough to shape a recovery which actively rebalances the growing inequality in our economies that has been the source of much political and social instability. That the bond market is not forecasting inflation indicates an absence of wage growth – in spite of unprecedented fiscal and monetary responses – and that should be a flashing warning light on the dashboard.

A recovery without growth for any but the wealthiest individuals and institutions is unstable. Governments and business should forge genuine working partnerships, bringing expertise and resources together to plan a stable, sustainable economic recovery for all. In the UK, the focus on addressing regional disparities in growth and productivity is the right policy response and needs a deep, sustained partnership with business to bring about the necessary change.

Cumulative percent change in real annual wages, by wage group, 1979-2018
Cumulative percent change in real annual wages, by wage group, 1979-2018 Image: World Economic Forum

‘Think big’

Bill Thomas, Global Chairman and CEO, KPMG International

Solving the health crisis is the priority – we're stuck until that happens. But with the promise of vaccines, hopefully we’ll have a once-in-a-lifetime chance to put things on the right track for future generations. The pandemic has magnified many faults across our societies that need to be addressed, and because of it, ESG is no longer a question but a necessity.

All stakeholders are demanding more because the problems society faces are global in scope and existential in threat. A global pandemic. Climate change. Racial injustice. Economic inequality. Rising unemployment. All distinct issues, but all connected.

We need to think big and business has an important role in leading on these issues. We can help ensure that we all collectively make a difference where it counts.

Find out more about World Economic Forum partners here.

Related topics:
Forum InstitutionalEconomic Growth
‘Invest in long-term growth and resilience’‘Radical collaboration’‘Transform quickly and effectively’‘Double down on collaboration’'Be prepared to respond effectively, creatively and collaboratively'Private companies must ‘be at the heart’ of recovery‘Harness the spirit of adaptability, ambition and collective endeavour’‘Plan a stable, sustainable economic recovery for all’‘Think big’

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