Trust and Leadership: G20 needs to step up its efforts

Photo: Compass

We need responsive and responsible leaders.

Recent elections in both emerging and developed countries have shown that a growing proportion of our citizenry is discontent with the political establishment, as populist causes have gained support in many parts of the world. Trust in politicians and public institution is eroding. For too long, we have ignored these trends.

The loss of political trust is worrisome. We need responsive and responsible leaders. Being a responsive leader means taking people’s needs and concerns seriously. Politicians, business leaders and figures from civil society have to carefully listen to people and take into consideration what they have to say. This also concerns the current anti-globalization sentiment. While increasing interconnectedness through the flow of goods, services, persons, capital and information has significantly contributed to wealth and welfare, we must not ignore that globalization and greater competition have also left some people behind. Leadership means addressing these concerns and incorporating them in future policies – also at the G20 level. This could for instance entail a greater focus on facilitating participation of SMEs and developing countries in global value chains in international trade negotiations. Responsiveness to anti-globalization sentiment also means that at the national level efforts need to be strengthened to implement concepts of life-long learning and education that provide relevant skills as well as social safety nets that include retraining measures.

Responsibility of leaders

However, responsiveness is not everything. Leaders need to be responsible. Taking on responsibility means standing up for your actions and convictions. Responsibility means taking the right decisions even if they come at a political cost. Being responsible is also characterised by thinking ahead, by anticipating the effects of an action on future generations and beyond national borders. Rather than echoing the populist discourse that scapegoats globalization for all kind of problems – from economic downturn to security concerns – leaders need to advocate real solutions. They have to clearly communicate the benefits of globalization and acknowledge that in today’s interconnected world only better international coordination and collective actions will allow us to fully exploit emerging potentials and tackle existing challenges.

These thoughts about responsiveness and responsibility seem somewhat abstract but especially now, with the start of the German G20 presidency, it is important to step back and re-consider priorities. The G20 offers great opportunities to bring together global leaders, to foster international policy coordination and to work towards collective future-oriented actions, thereby demonstrating responsible leadership.

The role of business

To increase responsiveness and responsibility the G20 has to work together with all stakeholders. A crucial role in this regard can be played by the G20 engagement process with business and the civil society.

As Chairman of the B20, the official representative of the G20 business community, I am closely involved in the G20 cycle. As business, we want to play our part: We want to assume responsibility and play our part in finding the best solutions for challenges and opportunities such as climate change, digitalisation, or sustainable growth. And we want to be responsive to the varying needs and concerns in all sectors and countries of the G20. As a family entrepreneur I worked under the premise: “The economy serves the people – not the other way around”. I am convinced this is also true for the bigger picture of the G20 business community.

Responsible Business Conduct

The B20 develops consolidated recommendations and concrete policy proposals covering the entire G20 agenda. A new focus topic we introduced this year is responsible business conduct. Environmental and social sustainability as well as the enforcement of human rights and good governance standards need to be considered when taking business decisions. The B20 is working on recommendations to the G20 on how to reinforce incentives and set the right framework for businesses to further integrate these considerations into their commercial strategies. This could for instance concern tenders for public procurement and infrastructure. Responsible business conduct is not only a moral imperative but also in our very own interest if we want to ensure sustainable and resilient growth conditions.

Whilst international policy coordination and international politics are the most visible aspects of global leadership, responsive and responsible leadership is actually needed in our everyday life from the business manager to the school teacher. Leaders are individuals and as such they make a difference. It is important that everyone participates in this attempt to regain trust – not only political trust but trust in the future. For this end, we have to act together and remind ourselves of the key values that should guide our actions.

The Business 20 (B20) is the official G20 dialogue with the global business community. In thematic taskforces business representatives and experts of the entire G20 jointly prepare concrete policy proposals. The B20 also participates in the development of G20 decisions throughout a perennial dialogue with all G20 members.

Image: Dr. Jürgen Heraeus

Since September 4. 2016 Dr. Jürgen Heraeus represents the global business community in the G20 process as B20 Chair. Moreover, he is the Chairman of the Supervisory Board of the Heraeus Holding, a technology company, and Chairman of UNICEF Germany.

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