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Davos 2012: The great transformation?

Tuesday 24 January 2012 – by Eleanor Lavan

Ahead of Davos, Eleanor Lavan of the British Bankers’ Association says the sweeping regulatory changes that the UK has initiated in recent months must be matched by other countries to ensure global recovery.

The World Economic Forum convenes in Davos tomorrow. The magnificent topic for this year’s annual meeting is ‘The Great Transformation – Shaping New Models’. And so, the emphasis of this year’s discussion will be G-SICs: global systemically important changes.

The WEF recognises that the necessary rebalancing and deleveraging of the global economy is only going to happen through thorough and transformational change.

The sort of reconfigurations of social values, resource needs and technological advances that have taken place at local-national level have to become commonplace internationally if the world is to transition out of limits of this current, difficult phase.

Nowhere are those reconfigurations seen as being more urgent than in nations’ economic structures.

WEF founder and executive chairman Professor Klaus Schwab trailed this week’s meeting in October last year, writing: “What we clearly need are new models for global, regional, national and business decision-making which truly reflect that the context for decision-making has been altered – in unprecedented ways.”

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The context of financial institutions, operations and transactions is now a global one. The downturn the world has taken in past years means that everyone has in some sense become a stakeholder in the world economy and the parts that make that whole.

The resolution of the financial crisis – that has, in Schwab’s words, engulfed us all since 2008 – has, then, to be undertaken globally. Decisions aimed at managing the risk and maximising the rewards inherent in financial transactions need to be level across continents.

The sort of sweeping regulatory change that the UK has set in train in recent months needs to be matched by other countries committed to shaping these new world models.

Schwab sees that the key to future growth and prosperity is unlocking the potential of micro-entrepreneurship, battling rising unemployment by nurturing an environment that allows innovative and talented people to create their own jobs. The UK knows how important this granulated view of decision-making is.

The BBA and its members continue to lead on schemes like Better Business Finance and mentorsme – schemes designed to turn models into trading enterprises and to sustain those businesses that are already succeeding.

Only yesterday, these endeavours to make life easier for small and start up businesses were acknowledged by the government, as Prime Minister David Cameron launched new initiative Business in You.

Considered together, these efforts prove sincere commitments in the UK to supporting the world economy from the bottom up.

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