While Covid has tested us deeply and forever changed the way we live, learn, work and transact, it has also opened our eyes to our collective capacity for compassion, transformation and innovation. What, then, can leaders do to harness this capacity – to use the urgency of adversity to reinvent growth? How can we create a competitive growth model that actually serves all segments of society while moving us towards a net-zero future in Europe?
To help us answer these questions we spoke to nearly 80 CEOs, senior executives, policymakers, experts and civil society leaders. We mined their insights to try to make sense of the past year´s uncertainty, and to explore how the events of 2020 could collide with pre-pandemic trends to produce a range of futures.
Why? Because in exploring different views of the future we can make better decisions today. We have a golden opportunity to correct course – and we need to do so urgently. We need to choose away the things we don´t want – inequality, joblessness, political polarisation and climate change, to name a few obvious ills – and choose the things that we know underpin well-functioning societies, markets and economies.
Everyone must to do their part but business has a special role to play. That´s why Xynteo´s new report – ´Choose Growth´ – is intended as a tool for business leaders. In it, we paint three plausible views of the future and identify the choices business leaders need to make to build resilience in their organisations today, while moving Europe closer to a net-zero, socially just, competitive future.
Future 1 - Walls Up (and Down)
The evolution of globalisation
Our first future, ´Walls Up (and Down)´, explores the evolution of globalisation. Here, we imagine that the globalisation we have become accustomed to since the end of the second world war – the progressive dismantling of barriers to the flow of goods, capital and people – continues to slow. This economic nationalism seeps into the international political order, weakening multilateral organisations and our capacity for global problem-solving.
At the same time, though globalisation as we know it may be stalling, labour becomes increasingly borderless. In eroding the long-standing connection between work and place, the pandemic-driven remote working experiment unlocks a truly globalised talent pool. This brings opportunity for both companies and workers – a wider pool of talent, lower expenditure on office space, a possible pathway to increasing ethnic diversity in the workplace, lifestyle-improving flexibility, and perhaps even greater gender parity in terms of pay and seniority.
But how will companies organise themselves to compete and operate in this new talent landscape? As the World Bank´s Sandie Okoro put it to us: “I doubt we’ll see as much movement of people between countries for work, but we will still see a globalised workforce. We should be considering the implications this will have on taxes and the way businesses operate.” Figuring out how to compete for the best talent in a more borderless workplace could be one of the next frontiers for employers.
And, taking a big step back, if the multilateral order does erode, what things will be harder for business? As one CEO reflected: 'Going backwards on multilateralism and free trade will be tough for business. You will need to be local in every market. You won´t have the scale. You won´t have the global platforms.’
Future 2 - 11th Hour
The long climate sprint begins
Our second future, the ´11th Hour´, imagines Europe making bold progress towards a net-zero future. Spurred on by the Green Deal, the market has embraced no- and low-emissions business models and is punishing carbon polluters as a matter of course. Thanks to Covid, the electorate has woken up to the dangers of an economic model that is wired to deplete the planet. Decarbonisation has become mainstream, in homes, markets and legislatures.
By the time we hit 2025, Europe has made notable progress on its climate targets and is locking horns with the US and China in a future-friendly competition for clean tech dominance. But we still have a long way to go to carbon neutrality. By 2025 we will have harvested the low-hanging fruit – for example, the electrification of power – but the hard-to-abate sectors still need to be cracked.
In order to close the gap, the business-government relationship needs not only to hold, but to strengthen. What adjustments will business need to make to take this relationship to a new level? How can we ensure this partnership stays focused on systems-level outcomes while also providing business with the commercial return it needs to stay in the game? As Henrik Henriksson, President and CEO of Scania, so clearly said to us, ‘We in business and politics have been living separate lives for far too long. If we are going to be ready for the next big challenge then we need to work hand-in-hand.’
Future 3 - Utechia / Dystechia
The two faces of tech-capitalism
In our third future, ‘Utechia / Dystechia’, we consider the light and dark sides of a hyper-digitalised economy. In this future we have successfully wielded fourth industrial revolution technologies not only to recover from the pandemic but also to make some of our cities smarter and improve our public health systems in the wake of Covid. We have also created new jobs, but we are lagging on equipping workers to perform these jobs – especially the workers who lost out disproportionately during the pandemic.
The net is that in 2025 we are failing on employment security – a precondition for healthy markets and a resilient employment model in Europe. This creates fertile ground for populist politicians to stoke the fires of discontent, threatening the wise and far-sighted governance we need to move forward to a job-rich, competitive growth model.
How can businesses stay competitive without weakening Europe´s workers? How can business work differently – whether acting alone, with peers in their industries and in partnership with educational systems and governments – to ensure that workers have the right skills to run a digital economy?
To find good answers to these questions we need to look far and wide. As Christy Pambianchi, EVP and chief human resource officer at Verizon put it to us: ‘It’s clear that adjustments to how labour markets function and how business thinks about, supports and manages its workforce will be necessary. I’m intrigued by how parts of the solution lie in both the US and European markets. We have much to learn from each other.’
While we think these futures could happen, they are absolutely not predictions or visions. They are tools.
The reality is that we will get the future we choose. Will we choose stasis or healthy change? Will we listen to science or ideologues? Will we promote cohesion or sow division to score short-term wins? Will we remain in thrall of old assumptions and systems that we know for a fact don´t serve us? Or will we build on what we have learned over successive industrial revolutions to build a form of growth that delivers societal and commercial value without sabotaging our biosphere?
And perhaps the highest-stakes choice we have to make is this: who will we choose to lead us through this crucial decade? As Octavia Butler wrote:
Choose your leaders with wisdom and forethought.
To be led by a coward is to be controlled by all that the coward fears.
To be led by a fool is to be led by the opportunists who control the fool.
To be led by a thief is to offer up your most precious treasures to be stolen.
To be led by a liar is to ask to be told lies.
To be led by a tyrant is to sell yourself and those you love into slavery.
Our next blog will focus on the six leadership choices we feel our three futures call for. In the meantime, get in touch, as Xynteo would love to hear your views.