- The world must act jointly and swiftly to revamp all aspects of our societies and economies, from education to social contracts and working conditions. Every country, from the United States to China, must participate, and every industry, from oil and gas to tech, must be transformed. In short, we need a ‘Great Reset’ of capitalism. …We must build entirely new foundations for our economic and social systems. The level of cooperation and ambition this implies is unprecedented. But it is not some impossible dream.
What kind of capitalism do we want? That may be the defining question of our era. If we want to sustain our economic system for future generations, we must answer it correctly. Generally speaking, we have three models to choose from. The first is “shareholder capitalism,” embraced by most Western corporations, which hold that a corporation’s primary goal should be to maximize its profits. The second model is “state capitalism,” which entrusts the government with setting the direction of the economy and has risen to prominence in many emerging markets, not least China. But, compared to these two options, the third has the most to recommend it. “Stakeholder capitalism,” a model I first proposed a half-century ago, positions private corporations as trustees of society, and is clearly the best response to today’s social and environmental challenges.
The Covid-19 crisis, and the political, economic and social disruptions it has caused, is fundamentally changing the traditional context for decisions 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. Leaders find themselves at historic crossroads, managing short-term pressures against medium and long-term uncertainties.
As we enter a unique window of opportunity to shape the recovery, this initiative will offer insights to help inform all those determining the future state of global relations, the direction of national economies, the priorities of societies, the nature of business models and the management of a global commons. Drawing from the vision and vast expertise of the leaders engaged across the Forum’s communities, the Great Reset initiative has a set of dimensions to build a new social contract that honors the dignity of every human being.