Delivering the Global Reset
In ODI’s 60th anniversary year we set out to challenge decision-makers and thought leaders to think differently about global challenges.
The Covid-19 pandemic raised the stakes, accelerating the need for systemic change and radical yet realistic measures to recalibrate social values and provide more sustainable and equitable pathways for the future.
In our 60th year, we convened a series of virtual conversations to interrogate global challenges and chart the practical steps required to create more resilient, equal societies and reimagine a world beyond the pandemic.
We invited global, community and youth leaders, activists, businesses, academics and experts to explore and share ideas to build a better world. Through the #GlobalReset dialogues we asked:
- How can global economic cooperation be reinvigorated to deliver a fairer and more sustainable future for all? How can this transformation address the climate emergency?
- What should political and societal leaders do to redefine the social contract and ensure more progressive and just policies post-pandemic?
- How do global and local institutions need to adapt to meet these challenges? What kind of coalitions and ways of working could emerge?
ODI argued at the outset of the pandemic that we cannot go back to normal, because normal was the problem.
Address the climate emergency
While the pandemic dominated global headlines last year, many countries also experienced deadly climate shocks. 2020 tied with 2016 as the hottest year on record. Locust plagues across East Africa left 42 million people facing severe food insecurity. Australia, Brazil and the US suffered unprecedented wildfires. After heavy monsoon rains, a third of Bangladesh was underwater. The frequency and intensity of such disasters will increase as average global temperatures continue to rise.
Yet 2020 was also a year of new climate actions. Major economies including China, Japan and South Korea joined the European Union with pledges to reach net-zero emissions by mid-century; the US followed in early 2021. The challenge now is delivering a rapid green recovery that sets the world on track to halve emissions by 2030 (compared to 2010 levels). For sustained success, the green recovery must be founded in a new social contract that meets the needs and addresses the concerns of the most vulnerable.
Support a green economic recovery
To date, 42% of the G20’s energy-related stimulus spending has flowed to fossil fuels. Over the next decade, countries plan to produce 120% more fossil fuels than would be consistent with limiting global warming to 1.5°C. There is therefore an urgent need to shift investment and lending towards low-carbon options.
Decision-makers all over the world are reflecting on the tools at their disposal. Low coal, oil and gas prices offer an opportunity to tackle the fiscal and climate crisis by reducing fossil fuel subsidies and introducing a carbon price. Central banks and institutional investors are starting to measure and report climate-related financial risks. Still more innovative approaches, such as border carbon adjustments and debt-for-climate swaps, are on the table.
Low-carbon investments can be job-rich. Retrofitting buildings, constructing mass transit and installing decentralised renewables can all boost employment, as well as reducing greenhouse gases. With COP26 looming and a new director at the helm of the World Trade Organisation (WTO), there is a window of opportunity to align climate and trade policy to accelerate the green recovery.
Prioritise a just low-carbon transition
Building a sustainable world economy must be based on embracing and unlocking the benefits of the green transition for all, rather than denying low-income countries the opportunities that are commonplace in, for example, OECD countries.
Reaching net-zero emissions also demands profound economic and social changes that carry risks for workers, communities, investors and countries. The benefits of climate action will therefore only be fully realised if the low-carbon transition is carefully managed to leave no-one behind.
Decision-makers need to adopt inclusive, forward-looking approaches to address the climate emergency, paying particular attention to the rights and needs of vulnerable groups on a global scale: women, children, people with disabilities, residents of informal settlements, indigenous communities and others who have been left behind in the high-carbon economic models of the present.
'The global pandemic is essentially a message from nature. It’s a loud and clear message.' Inger Andersen, Executive Director, United Nations Environment Programme
Reinvigorate global economic cooperation
The Covid-19 pandemic exposed the gross inequalities of the current economic and social order, fuelling demands for a fairer economic and political system. The crisis required a global effort on all fronts – but instead international solidarity fell short and protectionism and narrow national interest has dominated the response.
Now is the time to challenge power structures and dynamics that sustain inequality, and to create a fairer, more inclusive global economic system. Collaboration is key to developing a stronger and more equitable economy and redefining the social contract.
'We need companies, we need the private sector. And we need them because we need jobs, we need new opportunities.’ Maria del Mar Jaramillo Salcedo, Founder, Fundación Soy Oportunidad
Rewiring the economic framework
Our economic framework needs to move beyond a focus on efficient markets and cyclical‐countercyclical policies. Macroeconomic policies need to encompass employment and climate objectives rather than just focusing on how vulnerability to external shocks are minimised.
Governments should prioritise industrial policies for job creation, and invest in skills development, trade-related infrastructure and digitalisation – including to bring the digitally excluded online. Fiscal and monetary policies should be deployed to increase the provision of global and national public goods. Trade and industrial policies also need to be seen as complementary to traditional macroeconomic policy instruments such as fiscal or monetary policy. WTO commitments and Regional Trade Agreements could be used to transform economies, for example through digitalisation and e-commerce. Government regulation of the financial system should focus on shared prosperity, not just short-term profitability.
"We need to think about a future not merely built on output volumes, but on the quality of economic activity and social cohesion."
Kristalina Georgieva, Managing Director, International Monetary Fund
Investing for sustainable development
The twin crises of Covid-19 and climate change have underscored the need to direct investment in ways that drive more sustainable, resilient economic transformation. Public finance has a crucial role to play in raising and steering private investment. Domestically, eradicating environmentally harmful subsidies can lay the foundations for greener investments while providing robust social protection can encourage entrepreneurship and innovation. But the collapse of tax revenues and trade during the pandemic has also underscored the importance of international public finance to protect the most marginalised groups and ensure a green recovery. The fiscal burden must be shared equitably through both emergency financing and expanded investment.
Focusing on private finance, 2020 has been distinguished by new commitments to disclose climate-related risks, divest from carbon-intensive assets and adopt more rigorous ESG metrics. Many financial regulators and development finance institutions are pushing commercial banks, insurance companies, pension funds and other financial institutions to align their portfolios with the SDGs and the Paris Agreement. These steps are welcome, if overdue. Yet in parallel, Covid-19 has exposed and exacerbated inequalities. Poverty and unemployment rates are rising as the wealth of the richest balloons. Going forward, investments must be grounded in a new social contract to close the gap between rich and poor, and ensure decent living standards for all.
Watch our inequality conference
Our virtual three-part conference in partnership with IrishAid explored three central themes: the evidence on whether and how the Covid-19 crisis is affecting inequalities, the role fiscal policy – taxation and social protection – can play in tackling inequality, and the challenges and opportunities for a new social contract emerging as part of the global reset.
Investing in health care for all, in education for all, investing in resilience and climate action is something that cannot be constituted an expense or a burden.’ Vladislav Kaim, Youth Advisor on Climate Change to the UN Secretary General
Redefine the social contract
Political and societal leaders should take action to make progressive and just policies central to recovery post-pandemic. We must establish an economic system anchored in rights and dignity for all, founded on values of equality, solidarity, justice and human rights writ large.
Shifting conceptions of value and norms
'Value’ should not simply include resources that can be counted, but also encompass wellbeing, personal data and contribution to society, including through the care economy. Recognition of and support for the contribution of migrant workers in particular to economies and societies should be foundational.
Existing legal and political accountability mechanisms are often weak, and embedded in discrimination that hold back social and economic progress and undermine collective solidarity. We must move beyond policies that are simply sensitive to discrimination, and push for transformative and sustainable change that explicitly seeks to rebuild the social fabric while addressing injustice grounded in stereotypes and norms based on race and / or gender amongst other things, across all sectors and spaces.
Planning for the long-term
Over 150 countries have extended or developed social protection schemes during the pandemic, but many are interim and do not provide a long-term safety net. Economic and social protection measures have lagged behind those to contain the spread of the virus as policy-makers face major liquidity and fiscal constraints. A global fund for social protection for LDCs could plug the financing gap and insure them against risk. The expansion of universal child benefits and universal health coverage reduces vulnerabilities and promotes social cohesion and public support for social protection.
Economic and social protection measures have lagged behind those to contain the spread of the virus as policy-makers face major liquidity and fiscal constraints. Over 150 countries have extended or developed social protection schemes during the pandemic, but many are interim and do not provide a long-term safety net. A global fund for social protection for LDCs could plug the financing gap and insure them against risk. Expanding universal child benefits and universal health coverage would help reduce vulnerabilities and promote social cohesion and public support for social protection.
"We need to develop a new peace strategy for times of crisis. We can turn this challenge into an opportunity to restore confidence in a world free of war."
Tawakkol Karmen, Nobel Peace Prize Laureate
Promote digital governance and rights
Building political consensus to tackle global and domestic inequality will be challenging in an increasingly polarised world where rising inequality and weak digital governance have created ideal conditions for populism to thrive. This has further undermined the broad-based legitimacy democracies once enjoyed, one that was already seriously challenged by their inability to deliver ‘democratic dividends’ in terms of redistribution of wealth and a more inclusive social contract.
Some states have used the pandemic and the calls for the expansion of rights that have proliferated across the globe (as epitomised by the Black Lives Matter movement, but also pro-democracy protests in Myanmar, and the End Sars Movement in Nigeria) as a pretext for curtailing human rights, and access to digital freedoms. Keeping citizens ignorant or misinformed is one of the many ways regimes infringe on people’s rights and intimidate and suppress them.
"All the negative trends are telling us that we need allies in achieving peace and I believe that technology can be one of these allies." Branka Panic, AI for Peace
Navigating the digital landscape
The links between digital rights and human rights (including socio-economic rights) are complex and need to be better understood. Beyond governments, the role of the big technology companies needs to be brought under the spotlight. Digital spaces have exposed human rights defenders to intimidation and criminalisation, yet human rights legal frameworks potentially provide the needed foundation for guiding the production of online content and behaviours, while upholding individual and collective freedoms.
Radicalisation and violent radical movements across the political spectrum have proliferated globally, with platforms being used to recruit, diffuse hate speech and finance and promote violence. Yet oversight, governance frameworks and scrutiny by accountable institutions, lag considerably behind.
The world needs stronger systems of digital governance adapted to context. International Human Rights Law and the UN Guiding Principles that call on governments to protect human rights and on companies to respect and remedy where they are in breach, may already provide an important basis to guide practice in the digital space. Mechanisms to ensure transparency, accountability and compliance are what is lacking. In addition to more oversight or restrictions of access to platforms, diversifying and multiplying access to alternative sources of information online and offline is key to diminishing the weight of dangerous content.
"Information is power. And once our access to reliable information is restricted, our power is restricted." Sahar Zand, reporter and documentary maker
Global, national and community leaders need to collectively and actively engage in holding companies to account for their roles in fostering radicalisation and other digital public harms. While digital access and expression should be prioritised, states must protect citizens from malign forces online, for example through embedding education on digital and critical literacy from early years. The ability of states to protect their citizens is contingent on levels of public trust, and the ways in which states police their own behaviour. The rush to digital should not obscure the essential nature of analogue relationships: the need for public trust in institutions and fostering leadership legitimacy offline as well as online.
Embrace new coalitions and ways of working
The pandemic offers an opportunity to advance a long-overdue overhaul of global cooperation structures. Instances of multilateral innovation have invariably emerged from systemic crises. Global cooperation needs reshaping from the ground up, bringing together like-minded actors, as well as the not-so-usual suspects. Broad coalitions coalescing around a common goal can form the basis for a ‘new’ multilateralism. These coalitions have the potential to bridge global and local, digital and analogue, state and non-state, and include activists and political actors.
"If we want a truly inclusive recovery, then we need to empower leaders – particularly, women leaders. And not just in the old halls of power that the world is used to watching. But also in the places that the world rarely looks."
Melinda Gates, American philanthropist
Linking global and local leadership
New models of leadership will need to draw on experience and thinking from diverse groups. For example, national leaders can identify opportunities for people’s participation in inclusive processes, and strengthen local democracy by supporting civil society organisations to mobilise citizens and sustain the pressure for change. Local leaders, such as city mayors, are agents of change with better access to, and understanding of, their communities than global elites, and should be central to policy development.
Local engagement and leadership will be particularly important in crisis situations. We know that humanitarian action is stronger when it is locally rooted and led, but funding, decision-making and capacity is still concentrated in large international aid agencies. Governments need to move money and power to local authorities and local humanitarian organisations, who should lead humanitarian response – with international aid agencies providing support.
Upholding human rights and the laws of war
Seventy-five years after the UN was established, the promise of the Universal Declaration of Human Rights remains largely unfulfilled for most people in the world. A new multilateralism must be based on the principle that all states have a duty to protect human rights within their borders and beyond, and that the laws of war – which provide basic protections for civilians in conflict – are respected. While human rights and a rules-based order may be fundamental to building peaceful, just and inclusive societies – the battles over defining, upholding, and expanding the reach of human rights is always a political one. We must redouble efforts to uphold human rights and international humanitarian law, and agreements that ensure access to justice for all. We must also redouble efforts to understand the political battles that lie at the heart of struggles over the expansion of human rights. This is particularly vital at a time when human rights discourses are re-shaping global political imaginations in a changing geo-political landscape. Understanding how global and local politics influence respect for rights, will enable us to more clearly identify the levers, the formal and informal incentives for advancing them.
"We won’t succeed until we are talking to people under the Mango tree. Local leaders like Mayors have a critical role to play in reinvigorating global cooperation efforts."
Yvonne Aki-Sawyer, Mayor of Freetown, Sierra Leone
A new multilateralism must be based on the principle that all states have a duty to respect and protect human rights within their borders and beyond. This will mean redoubling efforts to uphold human rights and international humanitarian law, and agreements that ensure access to justice for all. We must increase pressure on those who hold power to uphold and be accountable for human rights, as well as the legal, political, formal and informal incentives for doing so.
Watch our gender conference
In partnership with Global Affairs Canada, we brought together experts, practitioners and youth activists to discuss how to achieve the social norm change needed to advance gender equality and women’s rights.
"We should actually be quite angry about how little in many ways has changed." Rt Hon Helen Clark
"We’ve got to share our humanity, otherwise people won’t trust us at all." David Nabarro CBE, Special Envoy on Covid-19 for the World Health Organization
In our 60th year we created a space for people to reimagine a brighter future beyond the pandemic. Some tangible recommendations emerged: we know we can take meaningful steps toward addressing the climate emergency through a reduction in fossil fuel subsidies, the introduction of a carbon price, and the creation of infrastructure to boost employment while reducing greenhouse gases.
We also know that equity and social justice need to be at the heart of any post-COVID aspiration to build back better if the struggles for social and racial justice, epitomised by the global explosion of the Black Lives Matter movement, even at the height of the COVID pandemic are not to be beaten back by populist disavowal of the democratic project.
These ideas would require a more radical shift in collective mindsets – a move toward shared prosperity, not just short-term profitability, in the regulation of the financial system; or the need for transformative and sustainable change in tackling structural racism and gender norms across all sectors and spaces.
As leaders, social movements, organisations and citizens committed to greater inclusion, expanding rights and tackling racial injustices grapple with these choices, ODI will continue to hold the space open to advance this critical conversation – and provide the evidence and critical ideas needed to deliver transformational change based on justice and equity as the foundations for resilient, just and equitable prosperity on a global scale.