‘Desperate Times Need Desperate Measures Or Then Let’s Accept Our Fate’

Rakesh Wahi
Published 2 months ago
Rakesh Wahi

It was wonderful to see the revival of the Forbes Global CEO conference that was held post Covid in Singapore in October this year. It was great to reconnect with global leaders as well as meet Forbes’ extended family from different parts of the world. The highlight of the event was the declaration from the organizers that the net worth in the hall of 400 delegates was $500 billion; it wasn’t surprising to hear that number considering that 30% of the wealth came from the richest man in the room – and third richest in the world as of November –  Gautam Adani, whose speech was a leaf from ‘Invest India’. The mood was buoyant in Asia and despite all the troubles around the world, there was much optimism about the future of Asian economies including the rich GCC countries that remain optimistic because of stable oil prices. This was a sharp contrast from my stay in Europe in July and August where the metaphorical and absolute temperatures are getting to be a point of concern about the future.

I was also fortunate to go back to Namibia (after 10 years), at the request of Dr David Namwandi (the country’s former minister of education), to deliver a talk to a mixed audience of ministers, diplomats, businesspeople, and alumni at The International University of Management. Namibia remains a small country by all standards and is still highly reliant on a rich and powerful neighbor as evident from the fact that almost 90% of all retail brands are South African brands. However, Namibia is an economy on the move and determined on chartering its own future in the years to come. Not only has the country recently discovered oil but has also pioneered the green energy revolution through the green hydrogen project – Hyphen, which is a multi-billion-dollar investment that will take the country towards energy security and clean energy. I was particularly impressed with the quality of executives I met at the Namibian Investment Promotion and Development Board who have a clear mandate from the government to catalyze investments.

This push is becoming more evident from almost all Southern African Development Community (SADC) countries that see the opportunity being created by the vacuum from a weak South Africa; that is still tottering in an abyss of short- to medium-term economic gloom. I am a believer that South Africa will regain its position on the African and global stage in the medium-term, but the political uncertainties and institutional failures will see a gloomy outlook for the next decade. This is no different from Nigeria which is the other straggling economy in sub-Saharan Africa (SSA), with huge potential but poor political leadership. The economy that has the greatest opportunity over the next five years is Kenya. The country has new leadership and perhaps a good chance to bring about changes to take advantage of the global interest in SSA. Our problems in Africa are however nothing compared to what humanity faces today.

As we end 2022, we seem to be meandering in a state of oblivion where the blind continues to lead the blind and there is no sight of the ‘one-eyed king’ who can provide leadership or direction in a compass-less global society that is appearing to be more morally bankrupt than ever before. It’s not as though we do not know the problems, or we do not have the solutions. School children are standing and screaming solutions before a deaf audience of leaders who continue to provide lip service to imminent issues; they are silent as self-interest remains the guiding principle of our actions. Words come cheap and we can make all the commitments at global platforms, but the sad reality is that nothing will change.

My views on the failure of the United Nations (UN) as an apex body to regulate the safety and security of mankind remain unabated. The organization needs a complete overhaul if the world order needs to be rebalanced and powerful and developed nations held accountable for their actions. However, that remains a wishful dream like many others. However, toothless as the office of the UN Secretary General (UNSG) is, you cannot ignore the appeal of António Guterres before an audience of global leaders at COP 27 in Egypt (except for all who matter and who were conspicuous by their absence including leaders from China and India).

For those who missed reading the UNSG’s speech, I am quoting from it: “This UN Climate Conference is a reminder that the answer is in our hands. And the clock is ticking. We are in the fight of our lives. And we are losing. Greenhouse gas emissions keep growing. Global temperatures keep rising. And our planet is fast approaching tipping points that will make climate chaos irreversible. We are on a highway to climate hell with our foot still on the accelerator. The war in Ukraine, other conflicts, have caused so much bloodshed and violence and have had dramatic impacts all over the world. But we cannot accept that our attention is not focused on climate change. We must of course work together to support peace efforts and end the tremendous suffering. But climate change is on a different timeline, and a different scale. It is the defining issue of our age. It is the central challenge of our century. It is unacceptable, outrageous and self-defeating to put it on the back burner. Indeed, many of today’s conflicts are linked with growing climate chaos. The war in Ukraine has exposed the profound risks of our fossil fuel addiction. Today’s crises cannot be an excuse for backsliding or greenwashing. If anything, they are a reason for greater urgency, stronger action, and effective accountability.” And it continues….

These are the helpless words coming from one of the most influential men on earth. Let’s examine some of the realities on the ground.

It’s not surprising to see that all nations are behind the curve on their ‘carbon zero’ strategy. It’s a well-known fact that the developing world will not have the resources to make the changes and the commitments made by the developing countries have not been kept and as and when the allocations are made, they will come with caveats that will most certainly bind them to donor nations for all times to come. These caveats are not clear right now but going by history there will be no free lunches during this transfer of technology. Given that the developed world is struggling with an energy crisis right now, most of them are unlikely to be able to allocate significant funds towards developing countries particularly in Africa.

There is major reluctance on the part of policy-makers to make drastic changes in policy to get large and profitable corporates to participate in this transition. If the world is indeed at risk of perishing and if the words of the UNSG are to be treated seriously, there needs to be drastic action. Let’s explore the banking sector briefly. In 2018, the banks across the globe collectively made a profit after tax of $1.36 trillion. This number is significantly higher for 2021 and 2022. It doesn’t take a scientist to understand that one year’s profits from all the banks or even 50% of profits for a period of three to five years will provide adequate resources to start a meaningful process of change. Similarly, the tobacco industry, the gaming industry, casinos and all luxury goods companies, just to name a few, should mandatorily be required to forgo profits for the next few years. Ultimately, the banks have made their money from high-interest costs and fees; there is no reason why they should not see good sense in contributing back for a change. As far-fetched as these ideas may sound, this is one of the few ways to act; desperate times need desperate measures or then let’s accept our fate.

There are also some other realities that we must face. Very few are taking the magical three letters of ESG (Environmental, Social and Governance) seriously. In a recent conversation with a group of private equity players that have many multilateral financial institutions as their limited partners, the senior executives made very controversial statements like: ‘if we are faced with a choice between ESG and profits, we will choose profits every time’. ESG is therefore a buzzword in our world of reporting; everyone is going through the motions of ticking the boxes, but the true intention remains money over everything else. We have all the management guru’s and consulting companies and the big four preaching ESG and the importance of purpose; the reality is that the gap between intention and reality is continuing to increase.

I cannot but reflect on the words of former US President Barack Obama: “We are the first generation to feel the effect of climate change and the last generation who can do something about it.” Let’s not procrastinate and make it a true intent to start galvanizing resources towards fixing our problems before it’s too late.