What is the New Reality – Lee Howell

Lee Howell is guest blogging for the Forum. He is Managing Director, Centre for Global Events at the World Economic Forum and will be attending the Annual Meeting in Davos.

 
The theme for the World Economic Forum’s 41st Annual Meeting is “Shared Norms for a New Reality.”  As head of programming at the Forum, I am asked frequently to elaborate on its relevance in 2011. It helps to unbundle the theme and examine it as two related questions. The first question is “what is the new reality?” as there are indeed many to contemplate.  The most prominent “new reality” is the re-balancing of the global economy.

Emerging markets, such as Brazil, China and India, are today considered the drivers of future global growth. In contrast, the traditional anchors of the global economy, the US, EU and Japan, are are facing fiscal austerity and fears of a jobless recovery.   Re-balancing in this context means that some economies will need to save more and consume less to get their fiscal house in order while their exporting counterparts will need to do the opposite to ensure a sustainable global recovery.

If re-balancing is a new reality,  then how will countries go about achieving this? Therefore the second question is a normative one — what will be the common behaviour among the key economies with regard to this re-balancing? If the shared norms that emerge are protectionism and currency devaluation, then the global economy will be in for a rough ride.On the other hand, if the shared norm is that of greater macro-economic coordination among the Group of Twenty economies, then the risk of another systemic financial crisis can be diminished and the prospects for stable growth increased. This is why the Annual Meeting presents a tremendous opportunity to demonstrate that leaders from all walks of life can work together to improve the state of the world.

But to do this requires participants in Davos to recognize that we live not only in a world that is increasingly complex and interconnected but also risks an erosion of common values and principles. “Shared Norms for the New Reality,” reflects the foremost concern of leaders today  –  the absence of a shared approach to address emerging challenges not only undermines public trust in leadership, but also puts at risk our future economic prosperity and political stability.  So in Davos, we plan to debate and develop shared norms that can transcend growing differences across generations, stakeholders and geographies in a multipolar world. For governments as well as corporations, shared norms provide the compass by which leaders give and receive direction, define benchmarks for acceptable and unacceptable behaviours, and ensure inclusive rather than exclusive outcomes.

Our objectives are straightforward for the over two hundred sessions in the official program . First to provide an interdisciplinary and systemic view of the major economic, political, societal and technological drivers that are shaping the “new reality.”  And second, to focus on questions of “how”, thus, in the true “Davos Spirit”, elaborating innovative ideas and solutions to global challenges that not only engage all stakeholders but that also reveal “shared norms.”  Am of course very keen to see the progress we make on both fronts over the next five days.