To answer that question, a niggling matter needs to be resolved first: the impression created by many individuals, organisations and agencies is that “prosperity” is already becoming more “inclusive”; is that, in fact, so?
That question has two most likely alternative answers, dependent on whether the respondent likes to the look at the top of society or at the bottom of society.
“Yes, prosperity is becoming more inclusive”
Those who like to make that response like to look at the bottom of society, and point out that our global system has reduced absolute poverty by half since the year 2000. But if a human being who couldn’t have even one square meal a day earlier now has that one meal, is it right to describe that as “inclusive prosperity”? Today, three billion people survive on less than US$2 per day (that includes any housing, transport, clothing and food); and $2 is less than the price of one cup of coffee in any coffee shop in London, Tokyo or New York. As much as eighty per cent of the world lives on less than $10 a day. They would all laugh at the notion that they share in “inclusive prosperity” when they compare their lives to ours.
You may not consider yourself “rich” but, to be in the top 1% of the world, you need to have an yearly income of only $32,400 or its equivalent. Alternatively, if you want to look at the matter in terms of wealth rather than income, you need to have a net worth of only $770,000 (including everything from the equity in your home, to your automobile(s) and other possessions, your retirement accounts, bonds, stocks, bank accounts, and cash).
A related issue is that we in the 1% are widely misled by the idea that lack of knowledge, information and technology are the main barriers to inclusiveness. We are therefore taken in by examples of worthwhile and indeed impressive corporate initiatives – which are however hyped as if corporate or technological initiatives are going to make prosperity globally inclusive.
Even a moment’s analysis will reveal that is not the case. Consider the following, which are touted as examples of the sorts of things that are going to make for inclusiveness, when they clearly aren’t:
- Biotech efforts to increase food production in order “to cheaply feed hungry populations”, as if cost or overall availability of food are the problem, when it is clear that the most food-deprived countries of the world are in that situation because these countries are led by people who are addicted to power, and more greedy for selfish gain than they are for the good of the people of their country
- Impulsive or systematic Corporate Social Responsibility initiatives, such as FedEx’s utilisation of its logistical expertise and capabilities to deliver, to the victims of Hurricane Sandy, four million pounds of relief aid from agencies such as American Red Cross, Direct Relief, and The Salvation Army;
- Adidas Group’s partnership with Grameen Bank to manufacture low-cost shoes for the poor in Bangladesh;
- Financial technology initiatives such as M-Pesa, a mobile phone-based money transfer, financing and microfinancing service, launched in 2007 by Vodafone for Safaricom and Vodacom, the largest mobile network operators in Kenya and Tanzania.
From the perspective of inclusiveness, the key issue with all technology is not what it may or may not be able to do, but rather who owns it and for what purpose.
“No; prosperity is actually becoming less inclusive!”,
That is the answer given by people who are probably focusing on wealth concentration at the top of society: only 8 people now command as many resources as 50% of the world’s population; last year the number of people who commanded that proportion of the world’s resources was 62. In 2014, that number was 80. In 2010, it was 388. The trend goes back to the 1980s, highlighted by successive annual reports by Oxfam, Christian Aid and other NGOS. The reason for that trend is the rise in the popularity, among the elite, of philosophies such as those of Any Rand which resulted in Thatcherism, Reaganism and the disastrous actions of Greenspan.
Is the main obstacle resources, knowledge OR will?
The principal challenges are:
- In the “developing world”, cultures of apathy towards, and cultures of collusion with, exclusionary social practices in most countries (e.g. casteism, as in India; tribalism, as in Africa; cliques, as in North Korea)
- In the “developed world”, the adoption, since the 1970s of philosophies which idolise greed and selfishness, such as those of Ayn Rand, resulting in statutory rules and regulations not being implemented or even eroded – think of the decline of anti-monopoly implementation, especially in the the US; or the non-implementation of existing financial rules from the 1980s, leading directly to our current crisis which started in 2007. The non-implementation of those laws ended up in the change of those laws for the worse, at least in the view of many scholars – e.g. the substitution of the 1930s Glass Steagall Act by the 1999 Gramm-Leach-Bliley Act.
Genuine steps to make prosperity inclusive
There are “only” two things we need to do if we are to genuinely make prosperity inclusive:
- Challenge the roots of the national cultures which produce apathy, fatalism, casteism, tribalism and cliquism, resulting in the greatest mass of people around the world being excluded from prosperity
- Challenge philosophies which idolise selfishness and individualism, and reverse the practical consequences of such philosophies[i]. Ideological steps towards inclusive prosperity would include prioritizing and embedding philosophies such as Relational Thinking. And on the practical front, there are many steps that could be taken – such as:
- Close offshore tax havens and loopholes in tax codes so that the wealthy can’t exploit those to hide their wealth
- Break up the concentration of wealth by a Wealth Tax, if you are on the Left – or, if you are on the Right, by a market-based alternative, such as requiring the wealthiest families to invest a proportion of their wealth/ income in the Least Developed Countries and/ or in the smallest companies.
- Reduce pay ratios so that the highest earners stay within some reasonable limit (say, 20-to-1 compared to median earners)
- Incentivise pharmaceutical companies to broaden the focus of their R&D, so as to prioritise the health challenges of the poor.
- Invest more in education, public services, social protections – and, in view of the continuing impact of technology on jobs, proceed systematically towards a Universal Basic Income.
The second blog describes how organizations might model inclusive prosperity
About the author:
Prabhu Guptara is an independent Board Member, Keynote Speaker & Conference Chair; he is Executive Director, Relational Analytics Ltd., Cambridge, UK; Honorary Chairman, Career Innovation Company, Oxford, UK; Distinguished Professor of Global Business, Management & Public Policy, William Carey University, India; and Member of the Board, Institute of Management, University of St Gallen, Switzerland.