Let’s enrol the private sector in a new three-way social contract
A significantly larger proportion of a global cross-section of society places higher trust in the private sector than other societal institutions, including the government, as per Edelman’s Trust Barometer Global Report of 2023. The private sector, seen to be more ethical and competent, is expected to engage more with societal challenges.
The 2024 report reinforced this sentiment, showing this trust as higher in the developed world than in the developing. It went further to reveal that while innovation is essential to tackle the major global challenges the world faces, businesses are trusted more than governments to take such innovations to the market in a safe, understandable and accessible manner.
A prime reason for the pre-eminence of business as a societal actor is its decision-making abilities and growing political and economic influence. According to a recent Harvard Business Review paper, nearly 75% of a global survey’s respondents indicated that the primary duty of companies is to work for the benefit of all stakeholders and not just shareholders—and businesses have to listen to the people.
These expectations are making the private sector a reluctant but active participant in several functions and responsibilities that governments historically shouldered. Businesses are embracing issues such as racial discrimination, gender equality and safety in the workplace, and there is growing evidence of it from corporate social responsibility (CSR) initiatives as well as their impact.
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