Today, much more so than in the past, no business can afford to narrowly focus only on its day-to-day operations, competitors and more immediate stakeholders. It is not only the leadership of multinational corporations who need to invest time and effort to understand the megatrends of our global village. At different levels, we all need to learn fast about the global shifts that will impact us in the coming years.
More specifically, it is imperative to ask what motive drives business and whether it is aligned with the needs and values of the inter-connected world we live in today. What is it that gets measured and how short- or farsighted is it? To what degree is the company strategy the outcome of good and responsible systems thinking?
The Covid-19 pandemic dramatically intensified the trend for a sharper focus on human, social and environmental well-being in general as well as in the workplace. A sharper focus means, in the business organisation context, to ensure reliable, and if needed creative, metrics to inform decision making. In the EY 2020 Megatrends report, the researchers contend that problems such as inequality, climate change and falling living standards ‘requires a longer-term perspective, a deeper understanding of value, and new metrics measuring human, social and environmental well-being.’
As examples, two areas that can be highlighted are:
- the measuring the quality of employment (job satisfaction and well-being) and
- social and environmental constraints as externalities
It could mean hard thinking and work to have these types of measurements in place, but it is the responsible thing to do and will contribute to the sustainability of the business. In addition, it improves macroeconomic statistics as they are typically aggregated from firm-level reporting.
The report concludes: ‘We are on the cusp of a significant change in the way societies make policy and conduct business. Companies will either evolve to realign with new values, or risk dissolving as their social contract is withdrawn. There is no looking back.’
Author: Dr Gerhard van Rensburg