Climate change. Globalization. Inequality. Over the next 20 years this trifecta will produce a period of uncertainty that will make the previous two decades look positively stable. How can business leaders ensure that their companies are confident, nimble, and successful instead of timid and unprofitable? The answer lies in three strategies that have been proven to work around the world: elevating community relationships to true partnerships, looking beyond government authorities for guidance, and making principled, consistent political choices. For smart firms, preparing for crisis will mean not only calculating strategic risks and being more efficient but also developing stronger social licenses to operate.
Today we stand at the precipice of not one but three converging and potentially catastrophic long-term trends: climate change, globalization, and growing inequality. On their own, each of these makes the occasional crisis worse: We might see a more destructive hurricane, a more widespread financial meltdown, or longer or more violent civil unrest. Together, though, these trends magnify challenges. The Covid-19 pandemic, for example, was not just a health crisis but an economic and political one as well.
