The Chal­lenge For Cor­po­rate Lead­ers

Rotman Management Magazine - - FROM THE EDITOR - By Rich Lesser, Martin Reeves and Johann Harnoss

If busi­ness lead­ers don’t step up to shape a more pos­i­tive fu­ture, they risk a back­lash that will limit their abil­ity to cre­ate value go­ing for­ward.

than it is today. THE WORLD HAS NEVER BEEN MORE PROS­PER­OUS Peo­ple around the world live longer, health­ier lives than ever be­fore. In emerg­ing mar­kets, bil­lions of peo­ple have moved out of ex­treme poverty, and in the de­vel­oped world, we en­joy bet­ter medicines, ed­u­ca­tion, in­for­ma­tion, con­nec­tiv­ity, and mo­bil­ity than most of us could have imag­ined a quar­ter cen­tury ago.

Th­ese achieve­ments have many fa­thers and moth­ers. Hu­man in­ven­tive­ness, po­lit­i­cal lead­er­ship, so­cial ac­tivism and en­trepreneur­ship have all con­trib­uted to what No­bel Prize win­ner Amartya Sen de­scribed as ‘hu­man free­dom’. Care­fully-crafted poli­cies for the free ex­change of goods, ser­vices, cap­i­tal and labour — com­monly known as glob­al­iza­tion — and the march of tech­nol­ogy have also played es­sen­tial roles. Th­ese two forces have in­creased pro­duc­tiv­ity, opened up mar­kets, and cre­ated op­por­tu­ni­ties for bil­lions of peo­ple to im­prove their lives.

We also live in a time of grow­ing in­equal­ity and un­cer­tainty. So­ci­eties are be­ing fun­da­men­tally chal­lenged in ways we have not seen for decades — with na­tion­al­is­tic rhetoric and agen­das from the far right and a deep dis­trust of busi­ness, glob­al­iza­tion and tech­nol­ogy from the far left. Many worry that such a po­lar­iza­tion of pub­lic opin­ion and pol­icy mak­ing could in­tro­duce new risks and un­cer­tain­ties that would de­ter in­vest­ment — which is al­ready far too low, judg­ing by cur­rent in­ter­est rates — and un­der­mine the ba­sis for fu­ture pros­per­ity.

Why this po­lar­iza­tion? While there are many causes, and they vary from coun­try to coun­try, it re­flects in large part wide­spread and grow­ing dis­sat­is­fac­tion with en­trenched eco­nomic and so­cial in­equal­ity and greater per­sonal un­cer­tainty in a fastchang­ing global econ­omy. It also re­flects peo­ple’s mis­trust of po­lit­i­cal and cor­po­rate elites, who are seen as the ar­chi­tects of this state of af­fairs.

Eco­nomic in­equal­ity within our so­ci­eties is a by-prod­uct of the way we have man­aged the past three and a half decades of global eco­nomic in­te­gra­tion. At the same time, tech­nol­ogy — in par­tic­u­lar, re­cent ad­vances in ro­bot­ics, ma­chine in­tel­li­gence, and dis­trib­uted ledgers (The Blockchain) — could re­place hu­man

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