Analysis

Australia’s COVID-19 opportunity

COVID-19’s impact on the Australian labour market has been dramatic and multifaceted. Some sectors of the economy have been almost completely shut down by government order. The demand in many industries has collapsed, while a few others have seen an increase. As many as one million jobs are under threat. Such estimates came before the government’s extraordinary JobKeeper scheme, which will undoubtedly reduce this figure considerably. Despite that, many who will keep their jobs may not actually have much to do at work. The economy will be in “hibernation” or on “life-support” for some time to come. We’ve gained about 1 billion hours of time If the economy has shed the equivalent of one million jobs, then we’ve gained about one billion hours of available time, and that’s just over the next six months. The full impact of the crisis could be even larger. What should we do with this time? Many of us are spending more time with children who are no longer physically at school. Some of us are doing tasks which our older relatives previously did. Netflix is also a compelling option. From a human capital perspective, the crisis presents a unique economic opportunity to re-train and up-skill Australia’s labour force. The Australian government jumped on board on Sunday, announcing funding that would cut the price of new six-month, remotely delivered diplomas and graduate certificates in nursing, teaching, health, information technology and science provided by universities and private tertiary institutions. Economists have long observed that investment in human capital (education, skills) tends to increase during recessions, because there aren’t as many well-paying alternatives. We can use it to get ahead of the curve In the current recession, the opportunities for training are greater. Even those of us who will remain employed but have little to do can use the time to invest in training. Our […]

Lessons from Asian banks on their coronavirus response

ArticleBy Jacob Dahl, Vito Giudici, Sameer Kumar, Vishal Patwari, and Gabriele Vigo Lessons from Asian banks on their coronavirus responseOpen interactive popupFinancial institutions in countries initially affected by the pandemic moved quickly to safeguard their employees, transform their operations, and serve customers in new ways. As the COVID-19 outbreak continues to spread around the world, the humanitarian crisis has been accompanied by immense social and economic disruption. Almost overnight, whole countries have had to accept a new reality: everything has changed, and daily life may never be the same. Asian banks have already had to grapple with all of these factors, taking actions to maintain operations, protect their workforce, and keep customers informed. Their actions could offer a valuable template for banks around the world that are still amid the crisis and experimenting with initiatives. By focusing on three imperatives—ensuring business survival, fulfilling social responsibilities, and adapting to the new normal—banks can minimise disruption and continue to provide vital services to their customers. Ensure business survival In response to the pandemic, Asian banks moved quickly to shore up their operations and implement new approaches to mitigate operational disruptions. They prioritised several areas to identify issues or obstacles to business continuity and then experimented with new solutions and ways of working. Confirm resilience of internal operations To guide the pandemic response, many financial institutions formed a response-management unit composed of executive-level, cross-functional teams. These teams were empowered to make key decisions as well as communicate COVID-19 responses quickly and effectively across the organisation.1 Asian banks also had to shift to remote working for most employees, a move that required IT to ensure the organization’s infrastructure and systems could support such a shift. In defining remote and work-from-home setups, bank executives considered both the level of human interaction required for certain tasks and the degree to which […]

When You Kant Figure It Out, Ask a Philosopher

Timeless Wisdom for Modern Dilemmas by Marie Robert Advice for modern dilemmas from the greatest Western philosophers. How can Kant comfort you when you get ditched via text message? How can Aristotle cure your hangover? How can Heidegger make you feel better when your dog dies? When You Kant Figure It Out, Ask a Philosopher explains how pearls of wisdom from the greatest Western philosophers can help us face and make light of some of the daily challenges of modern life. In twelve clever, accessible chapters, you’ll get advice from Epicurus about how to disconnect from constant news alerts and social media updates, Nietzsche’s take on getting in shape, John Stuart Mill’s tips for handling bad birthday presents, and many other classic insights to help you navigate life today. Hilarious, practical, and edifying, When You Kant Figure It Out, Ask a Philosopher brings the best thinkers of the past into the 21st Century to help us all make sense of a chaotic new world.

Business leaders: the shift to stakeholder capitalism is up to us

Mireia GinéAssociate Professor, IESE Business School Silvio DulinskyHead of Business Engagement, Latin America; Member of the Executive Committee, World Economic Forum Stakeholders’ demands are forcing executives and decision-makers to rethink their organisations’ goals. Corporate governance is key to define the role of stakeholders within a corporation and to give a concrete meaning to “stakeholder capitalism”. The adoption of collaborative models will require new corporate governance approaches. Business leaders have a unique opportunity to transform their companies for the future. The concept of stakeholder capitalism has been gaining traction against the prevailing shareholder-primacy model of profit maximisation. As the World Economic Forum’s founder, Klaus Schwab, asked in a recent editorial: “What kind of capitalism do we want”? Profits are not the sole purpose of a business. Let us remind ourselves that corporations exist to solve problems and provide services. If they are successful at doing this, shareholder long-term returns can increase, as society in general is better served. The debate regarding the role of stakeholders within a firm is, primarily, a governance debate. As in most challenges that require robust leadership to change the way we live, work and interact, transformation starts from the top. Corporate governance sits at the heart of this – and for this reason, the World Economic Forum has recently published a framework structured around seven pillars: 1. Defining corporate purpose 2. Governance mechanisms 3. Corporate risk management 4. Regulation and corporate adaptation 5. Governing disruption 6. Long-term vision, short-term needs 7. Cultivating trust Establishing corporate purpose is not an abstract exercise. A strong purpose guides the complex process of establishing priorities, since all major corporate decisions involve necessary trade-offs. Purpose must not only be explicitly defined, it must also be implemented. Shareholders must understand the organisation’s purpose and be able to identify the metrics related to delivering on it. One […]

Did Tolkien write The Lord of the Rings because he was avoiding his academic work?

By John M. Bowers Umberto Eco has examined our ongoing fascination with the Middle Ages and listed ten different versions including the “shaggy medievalism” of works like Beowulf. Much of J.R.R. Tolkien’s success as a ﬁction writer derives from assimilating several of these fantasies of the past including the decadent Middle Ages described by Faramir at Minas Tirith. Strangely missing from Eco’s literary types was the jolly, earthy, boisterous Middle Ages of the Decameron in his Italian tradition and the Canterbury Tales in ours. This Chaucerian legacy, so clearly embodied in Tolkien’s hobbits, is easy enough to miss because it has been so thoroughly normalized in English literature that it no longer seems “medieval” at all, especially in Oxford where Chaucer had been a steady literary presence for more than ﬁve centuries. Some listeners inside Merton Hall in 1959 might nonetheless have been surprised that Tolkien, best known for his work on Old English poetry, devoted a section of his “Valedictory Address” to recruiting Chaucer to the cause of Language against Literature in a debate still very much alive in the retiring professor’s mind: His merits as a major poet are too obvious to be obscured; though it was in fact Language, or Philology, that demonstrated, as only Language could, two things of ﬁrst-rate literary importance: that he was not a fumbling beginner, but a master of metrical technique; and that he was an inheritor, a middle point, and not a ‘father’. Not to mention the labours of Language in rescuing much of his vocabulary and idiom from ignorance or misunderstanding. Repeating views about Chaucer from his letter to John Maseﬁeld in 1938, this encomium would have sounded surprising only because nobody knew about Tolkien’s efforts at rescuing 14th-century vocabulary and idiom during his own long labors on Selections from Chaucer’s Poetry and Prose.HTMLPreview Like almost all medievalists […]

Mature Man Working On Community Allotment

How access to land plus a participation income could change the world

Samuel Alexander, University of Melbourne and Alex Baumann, University of Western Sydney | 27 February 2020 We’ve spent enough time criticising our broken system characterised by overconsumption and inequality so here’s a solution that should appeal to both sides of the political divide. Our civilisation is facing an alarming barrage of overlapping crises, together presenting an existential threat to life as we know it. Climate breakdown is intensifying; we are decimating wildlife populations; and more generally the life-support system called Earth is trembling under the weight of overconsumption. Just as concerning are the social consequences. The global economic system has produced deep, socially corrosive inequalities; poverty around the world is extreme; and worst of all, perhaps, is that even those who are “winning the rat race” so often find that the promises of consumer lifestyles are unfulfilling. Too much ink has been spilt already criticising this broken system. What about solutions and creative responses? In words often attributed to Albert Einstein, we cannot solve our problems with the same kinds of thinking that caused them. In this article we’d like to offer some new thinking: a policy proposal that we feel has the potential to be transformative. At its simplest, our proposal involves providing self-selecting unemployed public housing residents with a basic, living wage. With housing and other basic needs secured, the goal would be to enable these public residents to participate voluntarily in the creation of “simple living” communities and neighbourhoods that are sustainable, resilient, and consistent with human flourishing. If successful, our “wager” or hypothesis is that these initial examples could be scaled up to support the economically “redundant” and attract progressives across the political divide as a viable alternative for a sustainable society. Central to this vision is the recognition that access to land, just as with air and water, is not a market product. It is a human right and should be recognised […]

The way we make things is about to fundamentally change

“Tooling” – the process of designing and engineering the tools that are necessary to manufacture parts – was the essential technology behind the early industrial revolution. It allowed manufactured goods to go from humans to machines and powered the production of complex mechanical inventions like the steam engine. With new economies of scale driven by machines, raw materials travelled from developing nations to industrial ones, and cost-effective goods flowed back to other nations across the world. Our modern era of global trade and tariffs began. Today, we make raw materials and ship them around the world to factories that make parts. Those parts are shipped to other factories that assemble them into product components, which are then shipped all over the world to more factories that make ever more complex final products. This process is the legacy of the first industrial revolution. Tens of trillions of dollars in capital is travelling at any given time on boats and planes, for weeks on end, across the oceans. Almost every product has a part or component that has sluggishly moved through warehouses and customs facilities where bureaucrats have charged tariffs or VAT. This antiquated process is slowly starting to change. We are at the beginning of a new S-curve, one that will forever advance the way we make and trade goods enabling a new era of productivity. A new class of high-speed industrial 3D printers from companies like Carbon, HP and Desktop Metal, which are closer to a printing press than a printer, are enabling this change and quickly becoming an integral part of the Fourth Industrial Revolution. These new machines are capable of printing complex parts at a lower cost than traditional techniques like casting and will break even at 100,000 parts or plastic parts. The costs for low to mid-range volumes are almost […]

A four-day working week will not only improve wellbeing – it could save the planet

A shorter working week has re-emerged as a prominent subject of political and economic discussion in recent years, with the TUC, the Green Party and Labour taking a reduction of working hours seriously as a policy that could increase workers’ well-being, boost productivity and face the challenges of automation. In Germany, the IG Metall, Europe’s largest industrial union, led a strike last year that mobilized 1.5 million workers and won the option to individually reduce working time from 35-hours per week to 28-hours per week, while securing the option to return to full-time employment afterwards. While a shorter working week is often framed as a tool to fix a broken economic model that is working for the few, rather than for the many, the increased interest in working time reductions coincides with the emergence of powerful global movements that highlight another crisis that is facing humanity today: the depletion of resources, the degradation of our natural environments and above all the rapid heating-up of our planet. Here, too, pressing issues of intra- and intergenerational justice emerge, with people in the global south and the poor more likely to suffer the fall-out of an economic system that largely favours the capital-owning class in the global north. For decades now, the sustainability debate has largely been dominated by calls for ethical consumption, rather than facing the systemic root of the problem: an economic system that prioritises profit-making over workers’ well-being and even the preservation of the very natural basis of our collective life. To develop a sustainable economic model, it is becoming clear that we need to break with the imperatives imposed by the necessities of capital accumulation (endless “growth”) and find a way to provide a decent standard of living while honouring planetary boundaries. At the same time, our current working time and […]

A new network of leaders changing the system together

For over 20 years, the Schwab Foundation for Social Entrepreneurship has recognised social entrepreneurs as a new breed of leader – values-driven, inclusive, compassionate, entrepreneurial individuals who develop sustainable new models in business, social development and environmental initiatives. They have been at the forefront of R&D for society and civilization, accelerating how we solve problems and imagining new futures through experimentation, iteration and practice. In these two decades, we have curated and gathered over 350 leading social entrepreneurs from 70 countries in the Schwab Foundation community and embedded them into the platforms of the World Economic Forum. Together, they have demonstrated significant progress on how we approach environmental sustainability and consumption, health and education, rural development and job training, and finding new ways to advance human rights and equality in different contexts around the world. However, poverty, inequality and climate change are too large and complex for any single social entrepreneur or institution to tackle alone. It should be recognized that many of these issues are interconnected. \The underlying causes also run deep in history, politics and culture, and our best solutions are often constrained by outdated rules and skewed power structures. We are seeing that, in order to create real change, dynamic interactions and multi-stakeholder partnerships across ideological divides are critical to making the radical changes that we know we need. We need social innovation diffused within every sector so we can adopt, adapt, diffuse and scale what this societal R&D has shown to be possible and sustainable – whether it be self-sustaining eco-businesses in the desert, or community-based, tech-enabled healthcare. Those driving the social innovation ecosystem require imagination, compromise, resilience and, above all, committed, courageous innovative people. Therefore, the Schwab Foundation has expanded its remit to recognise and support an ecosystem of pioneering actors who share a common purpose: to accelerate our progress towards the Sustainable […]

What is ‘ecological economics’ and why do we need to talk about it?

Anitra NelsonAssociate Professor, Centre for Urban Research, RMIT University Brian CoffeyVice-Chancellor’s Research Fellow, Centre for Urban Research, RMIT University, RMIT University As environmental crises and the urgency to create ecological sustainability escalate, so does the importance of ecological economics. This applied, solutions-based field of studies is concerned with sustainability and development, rather than efficiency and growth. Also, given that cities account for 70-80% of global economic activity and associated resource use, emissions and waste, they are central to finding solutions to the challenge of sustainability. Ecological economics recognises local to global environmental limits. It ranges from research for short-term policy and local challenges through to long-term visions of sustainable societies. Ecological economists also consider global issues such as carbon emissions, deforestation, overfishing and species extinctions. Core concepts You’re probably familiar with some core concepts of ecological economics. These include “steady-state economies”, “carrying capacity”, “ecological footprints” and “environmental justice”. A steady-state economy is both relatively stable and respects ecological limits. Drawing on the work of mathematician and economist Nicholas Georgescu-Roegen, economist Herman Daly elaborated the model, editing a 1973 anthology, Toward a Steady-State Economy. In 1990, Daly co-founded the International Society of Ecological Economics (ISEE). It had three key principles: the human economy is embedded in nature, and economic processes are actually biological, physical and chemical processes and transformations ecological economics is a meeting place for researchers committed to environmental issues ecological economics requires transdisciplinary work to describe economic processes in relation to physical reality. Joshua Farley, who has worked with Daly, discusses some of these principles in an opening address to the Australia New Zealand Society of Ecological Economics (ANZSEE) conference at RMIT University later this month. In a partnership program of several North American universities, Farley teaches Economics for the Anthropocene postgraduates. They apply ecological economics to “real-world environmental solutions”. Some will talk at the conference about their research. Today overconsumption is measured against Earth’s carrying capacity. William Rees and Mathis Wackernagel developed the […]

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