About This Report
The social contract—the relationship between individuals and institutions—needs an overhaul.
Well before the urgent challenges of the COVID-19 pandemic and the long overdue focus on racial justice, diversity, equity, and inclusion changed history, it was clear that our social contracts were not fit for purpose.
For much of the second half of the 20th century, the roles and responsibilities of business, government, civil society, and people remained relatively constant and provided vital protections to support healthy and productive lives. But today, people are relying on strained protection systems that fail to keep up with our 21st-century realities. And there is increasing attention on the need to align the purpose of business with essential societal needs, such as the transition to a net-zero economy; a digital economy that sustains jobs, livelihoods, and economic fairness; and the advancement of diversity, equity, and inclusion.
The structural flaws in the social contract were already evident before 2020, and recent events have both revealed and accelerated those shortcomings in vivid ways that demand action. We now see more clearly the importance of the social safety net, functioning public health systems, and global collaboration. We see more clearly that the world remains too focused on short-term thinking, leaving us extraordinarily susceptible to shocks that create wide social and economic destruction, with the greatest impacts on the most marginalized groups. Recent events in the United States, are powerful reminders of how systemic and institutional racism continue to plague not only the U.S. but also the entire world, and they also reinforce the urgency of ensuring a social contract based on more inclusive models and practices. The rise of technologies to combat the health impacts of the coronavirus reminds us that privacy must be a core part of the development and applications of these promising tools.
We are at a hinge point in history where transformation is both possible and necessary. As we enter the decisive decade of the 2020s and aim to deliver on the Sustainable Development Goals and the Paris Agreement, it is imperative that business use its voice to act, enable, and influence, collaborating with governments, workers and their representatives, and civil society organizations to modernize the social contract. This paper outlines a framework for doing so.
A New Social Contract is Good for Business
Business has significant incentives to participate in the development of a new social contract.
- Shape the new role of business in society
- Create innovative business models, products and services
- Support and access a skilled workforce
- Respond to stakeholder expectations
- Thrive in a stable operating environment