In a fragmented world, how can we address interconnected global challenges | Education

In a fragmented world, how can we address interconnected global challenges | Education
In a fragmented world, how can we address interconnected global challenges 

In a divided world, how can we solve interdependent global challenges?

Recent shocks have exacerbated deep divisions and inequities around the world. At the same time, there remains an urgent need to address shared global challenges, raising the question of resolving challenges in a fragmented world.

In a changing world, previous models towards shared global goals are no longer valid.

Solving the challenges lies in part in a new approach to business leadership that involves innovation and collaboration, a revised social contract, and a renewed focus on constructive public policy. 

We are at a key point in history. Displacement and destruction stemming from COVID-19 and the invasion of Ukraine have sealed the pace of the post-Cold War world. Furthermore, these acute shocks have revealed and exacerbated deep social divisions and inequities. 

Amid this intense change, numerous shared global challenges require urgent action:

  • A fair and inclusive energy transition to limit global warming below 2°C.
  • Preservation of nature and ecosystems, including food systems, for people to prosper.
  • Action to address income inequality.
  • Replace systems that hinder racial and gender equity.
  • Protection of human rights, the rule of law and democracy.
Human progress depends on how well we respond to the defining dilemma of our time: how do we solve interdependent global challenges when our world is becoming deeply fragmented?

Global Challenges: Uninformed and Polarized

The “Great Fragmentation” is driven by multiple factors. Information technologies amplify disinformation and tribal behaviors, reinforced by the rise of the “splinternet”. Then there is an environmental breakdown that exacerbates social tensions and political polarization, democratic decline, and geopolitical divisions that drive a wedge between and within countries. In addition, social changes that reflect both significant progress and powerful backlash and growing economic insecurity and inequality further fragment societies.

Every fragmentation force is powerful. Their global impact is multiplied by their interconnections, which increases the difficulty of dealing with them. Political opportunists arm social divisions. Social networks accelerate fragmentation. And maximalist thinking (“my problem is the only one that matters and it is existential”) interferes with coalition building, even among potential allies. 

In this dynamic and complex context, a new approach to business leadership with more civility is needed, with three key elements: 

1. Innovation and collaboration to accelerate progress towards existing commitments. 

2. Contribution to a modernized and strengthened social contract.

3. A renewed focus on constructive public policy solutions.

These steps will help resolve global challenges and address fragmentation at the source, providing a “binding agent” that enables greater social equity cohesion and consensus.

Innovation and Collaboration

While companies have made numerous new commitments, there is skepticism about the degree to which ambition translates into action with real impacts. Those questions deserve an answer.

Businesses have embraced the vision of a net zero economy. Now is the time to double down on making net zero a reality. Key steps include short- and medium-term goals, commitments to a just and inclusive energy transition, and strengthened efforts to achieve Scope 3 reductions.

Similarly, many companies have supported the advancement of equity, inclusion and justice. Backing intention with action, bolstered by efforts to address seismic shifts in work, persistent racial and gender wealth gaps, and growing income inequality, is essential.

Corporate governance reforms are also badly needed. For example, progress in board diversity and environmental, social and governance (ESG) competency will help boards steer companies toward developing truly resilient business strategies.

These efforts must accompany a renewed commitment to innovation and collaboration. Incremental improvements to existing models will not achieve the required systemic change. Innovative products and new coalitions are emerging that enable progress towards the end of the internal combustion engine, the decarbonization of heavy industry, and new services that meet the needs of communities, which must be accelerated.

Modernizing the Social Contracts 

Recent years have revealed and exacerbated flaws in our social contracts, in part because they are rooted in the social structures, economic models, and demographics that defined society in the post-war world. They do not take into account new technologies and fundamentally new issues, especially the climate crisis. Our emerging era requires that business take an active role, while fully respecting the role of government, in redefining the social contract for the 21st century for all people to fully participate in society and the economy. 

Key features of a contemporary social contract should promote lifelong learning, transferable benefits, and the extension of labor protections to fast-growing casual work arrangements. That will provide greater social protection and mobility for all and foster dynamic and innovative workforces that allow businesses to thrive.

The social contract must also consider the urgent need for a fair and inclusive energy transition, providing transition assistance to people and communities disadvantaged by this change, considering intergenerational equity and allowing access to clean energy for all.
Finally, the new social contract must take into account the implications of new technologies, allowing broad access and rules that allow innovation to continue, with protections for impacts on human rights and privacy.

“Human progress depends on how well we respond to the defining dilemma of our time: how do we solve interdependent global challenges when our world is becoming deeply fragmented”. — Aron Cramer, President and CEO of BSR

Greater attention to political solutions

The primacy of the market economy that marked the immediate post-cold war is passing into history. Market solutions alone will not be enough to solve the significant global challenges we face; now is the time for business to shift to a more active and constructive involvement in public policy solutions.

Many business leaders may feel uncomfortable in this role, seeing political landmines and the risk of alienating key constituencies as more powerful than the opportunities for progress. This risk-reward analysis misses the big picture.

Addressing our shared global challenges requires policy frameworks that align incentives and transcend divisions. It is in the self-interest of business and the public interest that the private sector actively pursue smart policy.

An essential step is to reorient capital markets towards long-term value creation. Promoting universal reporting and disclosure standards that encompass social and environmental value creation, such as the International Sustainability Standards Board (ISSB) and the Task Force on Climate-Related Financial Disclosures (TCFD), it’s crucial. Businesses must also intervene to strengthen transparency and fiscal fairness. That will produce more realistic measures of value, improve economic fairness, and alleviate one of the main causes of fragmentation: a sense that the economy is stacked against the average person.

Progress is also needed to reduce the primacy of trade associations, which too often take a reflexively hostile approach to far-sighted political solutions. Your game plan no longer works, if it ever did, and the companies that allow this do a profound disservice.

A turning point for human progress

Whether the tipping point we face leads to a bright or alarming future depends on whether we can overcome and heal our deep fragmentation.

The models that have defined the last three decades will not be enough. By translating business ambition into real action, modernizing and strengthening our social contracts, and reorienting market and policy frameworks, we can deliver solutions to the shared global challenges that will define human progress for decades to come.


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