2020: Our New World of PushBack and BackFlips
Stability continues to unravel as we enter 2020.
In 2019, much of what we have all long taken granted was further unpicked. There is a whole lot more to come. This means more instability ahead. It will defy what most leaders take to be basic assumptions.
In 2020 the new, ill-defined normal we first identified in 2014 will be at the next stage of defining itself. But that cannot be assumed to be for the better, despite the pressure from a largely disaffected public which continues to press so vocally for something new.
This is more than populism. It is what this Thinking the Unthinkable (TTU) project labels “pushbackism”. Whether as customers, consumers, or voters, people take for granted that they can push back against what they resent or don’t like in leaders, politics, corporates and institutions. The anxiety and radical new thinking of the NextGen sharpens this pressure dramatically.
The price is high for those leaders who fail to get this – and they are the majority. C Suites, board members and all top executives across corporate and political life must take note.
The dramatic UK election victory for Boris Johnson symbolises much of what our TTU work has already revealed for leaders. But most find this hard to accept.
It confirms the profound impact of public disillusionment in a system which increasingly has not delivered for them and the leaders who lead it. The UK is not alone.
It took former UK Prime Minister David Cameron three years to admit what most leaders never do. He declared “I failed” to read the public mood in 2016 when he called the Brexit referendum.
Even BoJo had never expected to win the election with such a huge working majority in parliament. While broadly correct in his judgement, he under-read the massive scale of public disillusionment which gave him the thumping
majority, and which now gives him extraordinary, unchallenged political freedom.
The newly emboldened prime minister himself recognised this immediately. “Cripes, I’ve won,” screamed one front page headline over a photo of his punching the air in 10 Downing Street. He then repeated many times that huge numbers who never voted conservative had “lent” him and his new government their votes.
To achieve in short order what the public expect will necessitate even greater unravelling of so much that so many take for granted. But that is also what many want.
Prime Minister Johnson could easily fail within the time line of public expectations. Why? Public impatience and the ability of leaders to deliver are out of sync.
There was a blunt Johnsonian message that all leaders everywhere should repeat, whether political or corporate: “We are not the masters. We are the servants now”.
It mirrors the message from the US Business Round Table in August, then the even sharper alert from the British Academy project on the future of the corporation and Principles for Purposeful Business. “The purpose of business is to solve the problems of people and planet profitably, and not profit from causing problems”. This a profound shift of principles.
Power and influence will continue to be turned on their heads in 2020. The public and political moods worldwide have become radicalised by new tribalisms, resentments, nastiness and a swift rejection of those who fail to deliver.
Faith or confidence in many of those who lead is fast evaporating. To huge numbers of people, the unorthodox politics of Johnson and Trump are their way out to escape disillusionment. That’s why Trump, with support levels constant around 40%, will most likely be re-elected to a second term next November. It must be expected that the US Senate ensures he survives impeachment.
In 2020 and beyond, such challenges to orthodoxy will be tested on a huge number of issues that are now characterised by backflips. These range from the deepening backlash to the downsides of globalisation, to greater
inequality, corruption, the increasing disrespect for human rights and international law, to halting what the UN and scientific evidence signal is the imminent climate catastrophe for our planet without urgent action.
Except in Trump land, Modi’s India, Xi’s China and Bolsinaro’s Brazil, there is acute public anxiety for whether the climate emergency can be not just halted but reversed. The time for foot dragging is over, as tens of millions globally warn about regularly in large demonstrations of fear.
Those protests will become even bigger and impossible for leaders to swish aside. A vindictive, disparaging US Presidential tweet aimed at demeaning Greta Thunberg as Time magazine’s Person of the Year will only serve to fuel the majority public fear on climate.
Like so much confronting the world’s corporate and political leaders, the reality will become deeper existential threats to the ways they have assumed they can run things. Denial or prevarication will not provide solutions.
The stumbling, disappointing end to the Madrid COP25 climate confirmed the scale of failure by political leaders. They got nowhere close to delivering the dramatic global measures on carbon reduction that the near apocalyptic and unchallenged science now confirm. Delaying for another year to COP26 in Glasgow next November merely worsens the planet’s predicament.
Our firm TTU alert for 2020 is that on the climate emergency and a host of other pressing issues, leaders will be caught with their pants down. But when your pants are round your ankles and you suddenly have to run to catch up, you fall over! Leaders beware!
So our TTU advice based on constant interviewing of top leaders remains our core finding. The conformity which qualified leaders for the position they hold probably disqualifies them from embracing the scale of disruption to all they assume that is created by the unravelling of stability. To think otherwise is like trying to defy gravity by jumping up a sheer cliff face.
Pessimism? Optimism? These labels are not relevant.
The challenge for all top leaders for 2020 is to adopt a new view of reality. Time will not be kind. At speed they must bravely adopt that new humility in order to embrace, then adapt, the way they lead to the profound mood of change. They need to take new risks that create a vision to grasp and overcome the instability that marks the new realities.
Are you determinedly head down in denial? Do you believe that somehow the new, deepening turbulence is a blip? That everything will rebound and bounce back to the relative stability that a huge majority of people take for granted and will produce much better for them?
For too many leaders the answers are ‘yes’. They still chose to not embrace the implications of the new disruptions.
So in 2020 at TTU we urge: open your minds and eyes to the reality of the new normal that the assumed framework of stability is unravelling. Shed the preconceptions that earned you your job. Be humble. Think big. Think differently. Take risks. Feel comfortable to experiment and fail.
For 2020 we also urge leaders at every level to ask themselves - are you equipped with the professional spine to embrace the new realities, however uncomfortable and ever more bumpy this must be assumed to be?
In 2020 and beyond you must assume nothing else.
The climate emergency must be seen as the prime metaphor for the urgent need to redefine risk.
The nature of risk must be broadened and re-calibrated swiftly. This is a super-urgent priority for January 2020.
The deepening bush fires disaster in Australia and the public humiliation of Prime Minister Scott Morrison is the latest stark confirmation of what happens when leaders refuse to grip rapidly the nature of unfolding risks, this time posed by the climate crisis.
So the urgent implications for risk managers are profound. Nothing should be rejected as too extreme. There is an urgent new opportunity for risk professionals to take the lead.
In 2019, much of what we have all long taken granted was further unpicked. Our Thinking the Unthinkable work had already highlighted that the conformity which qualifies leaders for the top disqualifies most of them from accepting, embracing then dealing with the new scale of risk and disruption.
There is a much more to come. This means more instability ahead, with new and ever greater risks.
What is your plan?
Most immediate is the fast-growing public pressure for decisive action to counter the climate emergency. Those who fail to understand then embrace this must realise they will be marginalised and left flailing.
“There are a lot of laggards who are not really thinking about the whole issue of climate change,” says Fiona Reynolds, CEO of Principles for Responsible Investment, which represents $80 trillion of assets under management.
“A question for every company, every financial institution, every asset manager, pension fund or insurer: [is] what is your plan?” warns Mark Carney, the outgoing governor of the Bank of England. From February he will be UN Special Envoy for climate action and finance.
Most show no signs of gripping the scale of “the tragedy of horizon” that looms, its speed, or the plan they need, Mr Carney told Radio 4’s Today programme on December 30. That horizon is not just about climate. His analysis applies to risk more generally.
“By the time the extreme events become so prevalent and so obvious, it’s too late to do anything about it.”
Mr Carney warned of a harsh reality facing leaders. “It’s not moving fast enough.”
For the climate crisis, unless companies and investors wake up to the new scale of risk that is approaching at ever higher speed, many assets will become stranded and worthless.
The climate emergency must be seen as the prime metaphor for the urgent need to redefine risk. “If there is no action, there will be an emergency.” Mr Carney warns. That action requires “a variety of steps to bring the future into the present so that action is catalysed today”.
Progress, but will more follow?
There are hopeful signs of a shift in one key area: the purpose of business and its responsibility beyond pure profit-making. The call by the traditionally cautious US Business Round Table to drop the focus on shareholder primacy made a welcome impact last August. Then in November came an even sharper alert from the British Academy project on the Future of the Corporation: “The purpose of business is to solve the problems of people and planet profitably, and not profit from causing problems.”
This a profound flip on both business principles and risk. But will a critical mass of leaders embrace what now seems like the inevitable?
Sir David Attenborough, the 93-year-old public champion on the scale of new sustainability risks, has a sober warning. It needs bloody-minded determination to challenge conformist leadership.
Just before the New Year, the BBC’s Today programme brought him together with Greta Thunberg, the remarkable 17-year-old global symbol for reversing the climate emergency. Sir David told her she had “achieved things that many of us who have been working on it for twenty odd years have failed to achieve. You have aroused the world!” He thereby confirmed the huge cost of years of denial and foot dragging.
Leaders beware!
Our firm Thinking the Unthinkable alert for 2020 is that on risk, the climate emergency and a host of other pressing issues, many leaders will be caught with their pants down. But when your pants are round your ankles and you suddenly have to run to catch up, you fall over! Leaders beware!
The price will be high for those who fail to get this - and they are still the majority. C Suites, board members and all top executives across corporate and political life must do far more than just take note. They must act decisively. There is no longer a luxury of time to reflect or ponder.
Airmic and its membership are better placed than anyone to alert their leadership urgently to these new connected risks and the consequence of ignoring them. Together they can create the 20/20 vision on risk that is needed for 2020.