Is there an opportunity for society to be more socially and environmentally conscious after COVID-19? Kamalini Ramdas, Professor of Management Science and Operations; Deloitte Chair in Innovation and Entrepreneurship was joined in conversation with Professor Muhammad Yunus, Bangladeshi social entrepreneur, banker, economist, and civil society leader and ”the world’s banker to the poor”, awarded the Nobel Peace Prize in 2006 and founder of the Grameen Bank.
“There are aspects of the pre-pandemic world that we do not want to keep; our world was on a path to destruction, is there a new path that we can take which resolves these issues?”
Professor Yunus believes there is a world of three zeros that can be achieved: zero wealth inequality, zero environmental degradation and zero unemployment. He argues that the new world that emerges after COVID-19 has to be based on social consciousness. Businesses that caused the problems that confronted the world before the crisis should not be revived. Government bailouts should not focus on supporting the rich and established businesses, but the extremely poor, as without help they have no money to buy food, so people will die of starvation, not of COVID-19. Professor Yunus also thinks tribalism among national leaders has hindered our ability to take on a common enemy.
Can we design a post-pandemic world freer of wealth inequality, environmental degradation and unemployment?
Muhammad Yunus, Nobel Peace Prize winner in 2006, believes that we should not go back to a world that is a perfect replica of the one before the COVID-19 pandemic. Instead, he thinks we should choose a path that reduces environmental degradation, reduces wealth concentration and reduces the threat of unemployment. According to Professor Yunus, “if we follow the old ideas, old thinking, old structures, we will follow the same path of destruction that the planet was on before, so we should forget about all the old paths, all the old ideas, and instead, get fresh ideas”. The coronavirus crisis has revealed that multilateralism and consensus are fragile and human instinct is to protect their tribes rather than build a broader social consciousness.
Before the pandemic, people already considered the 2020’s as ‘the last decade’ because of concerns about the planet’s survival. COVID-19 means we have an opportunity to change this direction of travel. Yunus considers it a relief that financial institutions are not functioning during the pandemic, as they help fuel the concentration of wealth; while as everyone is facing the threat of unemployment because of Artificial Intelligence, we can take this moment to look afresh at how we can counteract this issue. He also notes the environmental improvements that have occurred as a result of a drop in human activity to show that we can reach a world with zero environmental degradation. To this end, Yunus stresses that money allocated to the rebuilding of economies should not be used for regenerating the old, destructive power.
Social consciousness should be at the centre of the new world that is built after the pandemic, according to Professor Yunus. Anything that does not satisfy environmental or social consciousness should be eradicated; businesses that were the root cause of many of the problems should not be revived after the pandemic eases. Instead, we should support those businesses that will help the planet. Yunus encourages us to imagine the world we want to create so that we can prioritise the elements the world should have and what we should remove.
In the future, the self-interested side of businesses needs to be balanced with social consciousness, while a new financial system needs to be a vehicle for social consciousness so that it benefits society rather than being a mechanism to increase wealth inequality. Indeed, human creativity needs to be harnessed into a new form of productivity and support for people to become entrepreneurs, with a redesigned financial system that is focussed on supporting entrepreneurs forming a business for the first time. Yunus cites his frustration at not being able to grow Grameen bank globally because of restrictive legislation and policy that favours incumbents as the type of process that needs to be redesigned to enable more social business venture capital funds.
Yunus cites examples for the way business can be reimagined could come from health for example, where the rise of ‘digi-health’ is changing the way patients interact with doctors, firstly to reduce the number of people in a waiting room at any one time, through to online delivery of prescriptions. Similarly, initiatives such as coronavirus insurance, targeted at poor families, will cover the cost of any hospitalisation as a result of the virus as well as life insurance, have been provided as part of a social business so the subscriber pays nothing. The insurance and hospital systems need to be redesigned so that they work towards a greater social good.
Moreover, adaptations to lifestyles have to be considered, such as the creation of a world where nobody eats meat, reducing the damage caused by climate change through shifting eating habits. People need to change their eating habits to reduce obesity and this can be driven by incentives related to micro-credit, where families have to go through 16 checks in order to qualify. Businesses have to have a social or environmental consciousness screen so that they do not harm somebody’s life to make a profit for themselves.
“World leaders have let tribalism get in the way of working together against a common enemy.”
Yunus points out that instead of focusing resources to counteract the pandemic, national leaders, such as Donald Trump have withdrawn from cooperation and taken money out of bodies such as the World Health Organisation. We are all suffering as a result of decisions such as this. With leaders taking us in the wrong direction, responsibility must be passed onto the individual to screen whether decisions are being made through the lens of social consciousness, while instead of attacking multilateralism, world leaders need to collaborate and reduce out tribal instincts.
Kamalini Ramdas’ conversation with Muhammad Yunus is part of the Wheeler Institute’s COVID-19 series – bringing together the expertise and experience of our extended community to understand, illuminate and offer solutions to the challenges created by COVID-19. Our differentiating factor is the role of business in addressing these challenges, with a focus on the implications and actions for those in developing countries.
If you’re interested in following the Wheeler Institute COVID-19 series, check out our previous episode below.
Muhammad Yunus, is a Bangladeshi social entrepreneur, banker, economist, and civil society leader and ”the world’s banker to the poor”, awarded the Nobel Peace Prize for founding the Grameen Bank and pioneering the concepts of microcredit and microfinance. These loans are given to entrepreneurs too poor to qualify for traditional bank loans. Yunus and the Grameen Bank were jointly awarded the Nobel Peace Prize “for their efforts through microcredit to create economic and social development from below”.
Kamalini Ramdas is Professor of Management Science and Operations; Deloitte Chair in Innovation and Entrepreneurship at London Business School.