Davos - Business leaders at the World Economic Forum Annual Meeting agreed that there was an urgent need to restore the compact between business and society.Jim Hagemann Snabe, member of the Board of Trustees of the World Economic Forum said there was a crisis of confidence in leadership and that companies needed to be responsive and responsible to all their stakeholders.
"We have an opportunity to reinvent how we do business, to refocus our efforts towards ensuring long-term sustainability," he said.
The central theme of the Annual Meeting of the 47th WEF is "Responsive and Responsible Leadership".
To restore trust, business was in need of a consistent North Star, said Frans van Houten, President and CEO of Royal Philips in the Netherlands, and a co-Chair of the 2017 Annual Meeting.
"Global companies need to rally around a multi-stakeholder approach to doing business," he added.
He said that, at Royal Philips, an internal values system was focused on shared responsibilities to investors, employees, suppliers and broader society.
The company actively pursued a life-cycle concept for its products and had committed to achieve carbon neutrality in its global operations by 2020.
Jobs at risk
According to WEF, the Fourth Industrial Revolution was putting lower and medium-skilled jobs at risk. More than 60 percent of jobs and 30 percent of activities could be automated today, said Dominic Barton, Global Managing Partner of McKinsey & Company in the US.
"We can't rely on government to reskill people in the face of rapid technological change and automation; business will have to drive this," he added. In this regard, McKinsey & Co had announced the Generation Initiative, a philanthropic commitment of $75 million across five countries to develop an approach to getting unemployed and unskilled youth into jobs.
Lubna S. Olayan, CEO and Deputy Chairperson of Olayan Financing Company in Saudi Arabia, stressed the dangers of short-termism.
"Social responsibility and philanthropy must be at the core; it's the only way to be sustainable," she said.
Olayan was one of the first private-sector companies to employ women in Saudi Arabia 15 years ago. This decision, although difficult in the short-term, had delivered enormous long-term benefits.
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Hiroaki Nakanishi, Executive Chairman of Hitachi in Japan, said collaboration was key. Challenges such as climate change, inequality and social cohesion were global in nature and needed a joint effort between business and government.
"Sustainability is the overarching goal for us; we want to be a solution-based business," he added.
WEF said that the Compact for Responsive and Responsible Leadership, sponsored by WEF's International Business Council, was being proposed for signature to all participants of the Annual Meeting 2017.
These leaders included chief executive officers, chairs and members of corporate boards, as well as leading investors and asset managers.
The goal, according to WEF, was to create a corporate governance framework with a focus on the long-term sustainability of corporations and the long-term goals of society.