Do the green shoots of economic recovery indicate it's business as usual or is today's business community at risk of falling backwards into deepening recession and social instability?
Business has to take responsibility for today's economic recession. The need for changing attitudes and the way business is done were the key messages presented by Peter Brew at a business forum, IofC London headquarters, on 4 February 2014. Brew expressed concern and caution whilst promoting a movement of cross-sector partnerships, underpinned by a strong moral compass and commitment to four pillars of sustainability in creating a vision for the future. The event was hosted by IofC UK's TIGE business programme on Trust and Integrity in the Global Economy.
West is not best
Peter Brew, a leading associate of the International Business Leaders Forum (IBLF), talked to a well-attended forum about the potential danger of complacency even with the appearance of green shoots of recovery: ‘We’ve been through what is nothing short of an economic earthquake ... We’ve seen the Western economies in disarray ... We have to accept that business created this problem and that business needs to remind itself of what led to the problem ... We’ve seen the growth of the East and developing economies creating a new landscape and we have to come to terms with a landscape that will never be quite the same.’
Brew highlighted a litany of sobering cases of how businesses have failed society across many industry and banking sectors. Commenting on the obscene, unjustifiable payments to senior executives and serious tax evasion by major, multinational corporates, he commented: ‘There is no business sector which can put its hand up and say we are pure in this.’
But what has been the response to the crisis?
He commented on the struggle by both governments and business to respond to find answers: ‘Despite the depth of crisis there has been little political consensus. Faced with fundamental problems, our politicians have been unable to grasp what their role is in moving this forward. ... We've seen “band aid” solutions to symptoms rather than dealing with fundamental issues, with a remarkable lack of leadership. Very few business leaders, in any sector, have been prepared to stand up and be counted.’
The Inescapable Truths
What are the inescapable truths that business has to address to move forward?
Brew highlighted the need for redefining a new world economy: ‘The economic landscape has to be redrawn. ... The West can no longer see the rest of the world with a master servant mentality. ... The idea that we will fall back to the way it used to be and the West dominating is unlikely. ... We have to think what this means. The big risk is social instability.’ He was surprised there hadn’t been more social unrest in the light of huge levels of unemployment.
He added: 'What we have to accept is that there is a new dynamic where there are new players in the world's economies. We can either see them as partners with a common interest or see them as enemies.’
He commented on the risks of such social instability: ‘So we are facing an era of social unrest unless we begin to tackle it and every one of us in business; every aspect of society has a vested interest in social stability. In business there are very few companies that thrive in an era of instability.’
He further added: ‘It’s no longer enough just to comply with laws and regulations. In a new economic landscape companies will have to think beyond just compliance. Brew referenced Donald Rumsfeld: ‘Just because something is not illegal does not mean it’s right. We have to have more business people thinking of what is right than what is purely legal.’
Creating a Vision for the Future
Brew suggested that business needs to accept that the future lies in creating cross-sector partnerships; to adopt best practice from around the world and to put sustainability at the heart of business.
Brew, championing the sustainability agenda, stressed the need for a strong moral compass and commitment to sustainable development: ‘The business of the future has to balance four key elements for sustainability – the economic, environmental, human and ethical dimensions. If you concentrate on one to the exclusion of the others you undermine the company's future.’
Brew also advocated: ‘For the future we have to find a way of getting those sectors working together effectively and understanding each other. ... there needs to be an intermediary. Someone needs to be able to bring those sectors together and create the space for the dialogue.’
In the new world economy, sustainability is the critical issue and not profit. ‘The next three months’ profit is not the big issue but whether this business is going to exist in 10, 20 or 30 years’ time.'
The question for business moving into a new world economy is: ‘Is business going to make a real contribution not only to its stakeholders but the community in which it operates?’
His talk was followed by round-table discussions and vigorous feedback from the audience. Several young people asked if they could keep in touch with Initiatives of Change.
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