At January’s World Economic Forum in Davos, Switzerland, the five co-chairs, including Aetna Chairman and CEO Ronald A. Williams, shared their thoughts on actions most urgently needed as we revamp the global financial regulatory framework and try to extract ourselves from the economic morass into which we have sunk.
Williams broached the idea of a sovereign lens, saying actions will unfold in the “cultural context” and “political environment” of each country. “That means that each country really looks through its own lens at how capitalism has evolved and will unfold, and that the political and regulatory framework is really going to be a combination of the policy perspective in that country, along with the politics and, in some cases, populism,” he explained.
In theory, the sovereign lens provides clarity with which to create an appropriate road map for sustainable economic growth.
Corporations and other organizations, too, have a sovereign lens, which should examine internal values and attitudes in the context of the road map. “It’s extremely important for organizations to be values based and to be certain that they articulate those values,” Williams said. “It’s not part of the financial community, but…the opportunity is to look at those values and make certain they are contemporary in the context of today’s challenges, as opposed to the challenges we faced a number of years ago. I think I would encourage everyone to take a look at those values and make certain that they are contemporary in the context of the challenges that the broader global community is facing.”
In every road map, job creation must be an imperative. That means each country will have to develop the talent for the jobs that will be needed in the future — those jobs to be determined by its sovereign lens, of course — as opposed to the “historical” jobs.
However, the ability to work goes beyond possessing the requisite skills. Good health is one of the enablers of work, Williams argues, and countries must begin to develop programs that focus on chronic diseases — both infectious diseases and the increasingly prevalent noncommunicable diseases brought on by modern living. “As we shift to urbanization, what we’re going to see is countries that have both the problems of infectious diseases and poverty, and the problems of modern living as people have diets that are much more high-calorie and just get much less physical activity,” he said. “When you look at global risk, I think health is one of the important areas. Good health, in fact, turns out to be a precursor to employment, assuming the jobs are there and they can continue the growth.”
The clarity of the sovereign lens must infuse every aspect of the road map. For example, “... one of the things I think can help both job creation and economic growth is what I would call ‘sector clarity,’ ” Williams said. “We have a great deal of uncertainty sector by sector where it’s not necessarily clear what the rules will be. And the one thing businesses like is some degree of predictability and certainty around the regulatory, legislative and tax framework. It should be whatever the multistakeholder community believes it should be, but understanding what that is so that investment decisions can be made, I think, would be extremely [essential] to accelerating the recovery in job creation.”
The challenge of the sovereign-lens theory is to ensure that each country’s political, corporate, populist and other stakeholder lenses are in focus on the overriding goal of long-term economic sustainability.