This weekend’s Fortune/TIME Global Forum left me convinced that global business is at a tipping point. The shareholder-first model that guided many companies in the post-World-War II era is dying, and a new model is struggling to emerge. The change has a number of causes, but chief among them:
- The stagnating growth and inequality in developing countries that has left more than two-thirds of those populations with flat or declining incomes for the last decade (see McKinsey Global Institute report Poorer Than Their Parents.)
- The fear of spreading populism that has the potential to tear down the current economic system (with Italian Prime Minister Renzi–arguably–as the latest victim).
- The aspirations of a new generation of leaders and workers who sincerely want to build a better world.
The group that gathered in Rome was a self-selected lot, and might be viewed as preaching among the choir. Even so, it’s a chorus whose members wield considerable influence. It included CEOs from companies employing some 4.7 million people, including McKinsey, Siemens, IBM, Barclays, Shell, Flex, Lenovo, Allstate, Monsanto,United Technologies, Sprint, Telecom Italia, Campbell Soup, Virgin Group, Walgreens Boots, WPP, Novartis, Dow Chemical, Hyatt, Deloitte, Boston Consulting Group, Baxter, Teneo, Insigniam, Mastercard and more. In their deliberations, they agreed to 20 specific actions to address global economic and social problems, ranging from building a corps of community health workers in poor regions of the world, to creating digital identities for the 2 billion people who lack access to financial services, to educating and training displaced, unemployed and underemployed workers.
The actions proposed were not charity, but rather a different way to think about their businesses. Attendees urged their business colleagues to embrace under-served markets, expand basic health services, and improve worker training as part of their core business activities. Their underlying assumption was that such efforts will only be sustained if they are also profitable.
The group’s report was shared Saturday with Pope Francis, who has been an advocate of broader prosperity and a sometime critic of business. In an unexpected move, the Pontiff took time to shake the hands and look into the eyes of each of the CEOs. The Pope is one of the few leaders who has retained an aura of moral authority in this age of outrage. The lesson for CEOs: they need to boost their own moral authority to thrive in the years ahead.