The Covid-19 crisis, and the political, economic and social disruptions it has caused, is fundamentally changing the traditional context for decision-making. The inconsistencies, inadequacies and contradictions of multiple systems – from health and financial to energy and education – are more exposed than ever amidst a global context of concern for lives, livelihoods and the planet.
We only have one planet and climate change could be the next global disaster with even more dramatic consequences for humankind. We have to decarbonize the economy in the short window still remaining and bring our thinking and behaviour once more into harmony with nature.
A Great Reset is necessary to build a new social contract that honours the dignity of every human being. The global health crisis has laid bare the unsustainability of our old system in terms of social cohesion, the lack of equal opportunities and inclusiveness. Nor can we turn our backs on the evils of racism and discrimination.
We need to build into this new social contract our intergenerational responsibility to ensure that we live up to the expectations of young people.
We have to make sure that the new technologies in the digital, biological and physical world remain human-centred and serve society as a whole, providing everyone with fair access.
This global pandemic has also demonstrated again how interconnected we are. We have to restore a functioning system of smart global cooperation structured to address the challenges of the next 50 years. The Great Reset will require us to integrate all stakeholders of global society into a community of common interest, purpose and action.
We need a change of mindset, moving from short-term to long-term thinking, moving from shareholder capitalism to stakeholder responsibility. Environmental, social and good governance have to be a measured part of corporate and governmental accountability.
Klaus Schwab, Founder and Executive Chairman of the World Economic Forum.
The Great Reset agenda would have three main components.
The first would steer the market toward fairer outcomes. To this end, governments should improve coordination (for example, in tax, regulatory, and fiscal policy), upgrade trade arrangements, and create the conditions for a stakeholder economy. At a time of diminishing tax bases and soaring public debt, governments have a powerful incentive to pursue such action.
The second would ensure that investments advance shared goals, such as equality and sustainability. Here, the large-scale spending programs that many governments are implementing represent a major opportunity for progress. The European Commission, for one, has unveiled plans for a €750 billion ($826 billion) recovery fund. The US, China, and Japan also have ambitious economic-stimulus plans.
The third would harness the innovations of the 4th Industrial Revolution to support the public good, by addressing health and social challenges. During the COVID-19 crisis, companies, universities, and others have joined forces to develop diagnostics, therapeutics, and possible vaccines; establish testing centers; create mechanisms for tracing infections; and deliver telemedicine. Imagine what could be possible if similar concerted efforts were made in every sector.