What are two of the biggest challenges facing the global business community that have been triggered by the rise of populism?

Rise of populism across the globe has caused instability in the socioeconomic and political systems of the countries like UK, Brazil, etc. and regional bodies like European Union. The sentiments of the masses aroused by the political parties and their leaders for their own electoral gains, have caused great amount of polarization on many socioeconomic and political grounds. It induces to prioritise the local industry, labour force and enforces protectionist measures, which defy the very idea of globalization. The free flow of capital, labour, goods, services and knowledge across boundaries of nation states, have been beneficial in maintaining stability in the economic and political systems across the globe. But populistic forces are trying to undo that.

Global business community has coined as word as acronym called VUCA world which stands for Volatile, Uncertain, Complex and Ambiguous world in which they have to operate now. In contrast to the global integration, fragmentation is the current issue of major concern for global business leaders.

Following are the two biggest challenges facing the global business community that have been triggered by the rise of populism -

(i)??????????????Instability of the political systems due to changing regimes between the right and left wing parties, causing unpredictability of economic policy and ecosystem. The example of the wisdom of the great stalwart leaders of United States of America, to secure, preserve and maintain its democracy by managing their own hunger to be populistic and check such other forces and democratic institutions with adequate provisions to ensure check and balances with separation and powers and responsibilities, is not being seen in most of the nation states across the globe in the current era. The democratic set up of the governance mechanism in most of the countries across the globe do provide scope to the aspiring leaders to arouse the common people to find a common enemy, mostly in the big business houses, or some big corrupt political leaders/ bureaucrats, army or other such forces who are controlling the existing political establishment. Elections being won on the basis of majority of the votes of the people with one person one vote system, they find it easy to arouse the sentiments, of the majority of the population, which is deprived of the basic needs, viz. food, clothes, housing, education, health, network, infrastructure, connectivity, jobs, exclusions, deprivation, disparity, etc. Populist leaders do make unrealistic promises to such masses in their respective manifestoes and try every possible mean to come to power. Once they win the election, they don’t know how to fulfil the promises they have made to the people who elected them. It then becomes difficult to manage the finances of the government, to fulfil such tall promises. High direct and indirect taxes, surcharges, levies, duties, customs, excises, etc. on individual and corporations hamper the investor friendly climate of the economy. This increases the trust deficit between the businesses and government. It also induces scope for corruption promoting tax evasion. Such kinds of cyclical process repeat again and again causing the economy to perish and then putting the responsibility on the global integration measures, providing excuse for protectionism in the economy.?In such case, as the tenure of the such leftist or centre- leftist government matures, rightist or centre rightist gain enough ground in their captive vote bank to find ways to accuse the incumbent leftist government responsible for their perils. As the common people also have not been beneficial from the leftist policies, they also change their stand in next election. Therefore, as the government change in next election. The entire policy dynamics and investment ecosystem changes, however, dangers for further instability, do not build the required trust among the investor community to fund the projects in such country.?

(ii)?????????????Protectionist measures to appease certain sections of society, causing fragmentation across boundaries among economies of different countries’ economies and also between the labourers, industrialists, small and large businesses, farming community, youth and women so as to secure their own vote banks to survive in power.?UK’s Brexit step, policies of former President Donald Trump in US, China’s treatment with foreign investor and foreign companies at the time of outburst of COVID19, etc. are some of the examples of protectionist measures across the globe. Similarly, policies of the national/ provincial/ local governments of the countries which discriminate among the people who are living there or immigrated/ immigrating as a labour force or entrepreneur/ investor on the basis on caste, creed, race, religion, region, nationality do also poison the working environment in such economy. Distrust on the work place with in an organization or among supply chain partners or policy stakeholders, etc. do hamper the business climate in the country. Such kind of identity-based politics has gained momentum in recent years, across the globe. Aspiring leaders find it easy to consolidate people on the basis of their identities, by arousing their emotions. Companies, however tries to create awareness amongst their staff about maintaining diversity and inclusion on the workplace. But the degree of one’s own understanding to grasp and consider all humans as equal without any identity-based discrimination can’t be changed in one go. Social media is playing its role on both sides. Governments needs to build their social political ecosystem to be cohesive, inclusive and diversified, non-violence based, by showing some maturity on this front.

Businesses of the world have many challenges. As human society evolves, every day there will be new challenges. All of us need to work together in collaborative, cooperative and mutual existential way, so as to ensure sustainability of humankind and nature as a whole, in peaceful, productive and happy manner.?