Global Trends Reshaping Business Strategy, Markets: Report

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Last updated at: (Beijing Time) Thursday, April 04, 2002

Global Trends Reshaping Business Strategy, Markets: Report

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Businesses that wish to survive and thrive in a global economy must respond to major social and environmental trends that are reshaping markets, says a report released Wednesday by the United Nations Environment Program (UNEP), World Business Council for Sustainable Development (WBCSD) and the World Resources Institute (WRI).

Backed with facts and figures, the new report outlines 19 powerful trends that are reshaping global markets and changing the roles and strategies of corporations.

Entitled "Tomorrow's Markets: Global Trends and Their Implications for Business," the report is the first publication that links global economic, environmental, and social indicators to market development in order to help businesses better respond to future challenges.

The report reflects the rising interest in using market solutions to address some of the world's most pressing problems.

"This report emphasizes global trends that will help business leaders better understand the inter-relationships between environment and development issues, and, in turn, respond more effectively to the enormous challenges before us," said Klaus Toepfer, UNEP executive director. "We need a sound healthy environment for development. It makes business sense."

Since the world economy depends on natural resources that is being severely degraded, reducing consumption and waste creates new opportunities for businesses to grow through the innovation of less wasteful process and with life-enhancing goods and services.

The report says that future markets will favor businesses that partner with government and civil society groups to serve basic needs, enhance human skills, increase economic capacity, and help remedy inequities.

"This report will provide companies with information to identify the fundamental signals that influence their success and drive their innovation," said Bjoern Stigson, WBCSD president. He added that developing economies will present companies with new market opportunities to help meet health, education, and nutrition needs.

The report stresses that wherever they operate, businesses must meet both increasingly rigorous governmental regulations as well as societal expectations of socially responsible behavior.

"The challenge of the future is to choose a course that satisfies the market requirements for growth, maintains the natural balance that sustains our economies, and meets the needs and rights of global communities awakening to new dreams of health, prosperity, and peace," said Jonathan Lash, WRI president.

The topics covered include population, wealth, nutrition, health, education, consumption, energy, emissions, efficiency, ecosystems, agriculture, freshwater, urbanization, mobility, communications, labor, democracy, accountability, and privatization. The global trend for each topic is presented in a concise, lively format that can be easily adapted for business use.

Among the trends highlighted in the report are:

-- The money spent on household consumption worldwide increased 68 percent between 1980 and 1998. In many developing countries, food purchases account for as much as 70 percent of family income.

-- World energy production rose 42 percent between 1980 and 2000 and will grow 150-230 percent by 2050. Renewable resources like solar and wind account for only 11.5 percent of current consumption.

-- Over the past century, world water withdrawals increased almost as fast as population growth. Currently, 70 percent of freshwater withdrawals is for agriculture.

-- The current addition of 60 million urban citizens a year is the equivalent of adding another Paris, Beijing, or Cairo every other month.

-- Today, over 400 million people use the Internet, compared with less than 20 million 5 years ago. By 2005, there will be about a billion users. However, more than half the world's peoples have never used a telephone.

-- In developed countries, the working age population will shrink from 740 million to 690 million between 2000 and 2025. In developing countries, it will increase from 3 to 4 billion people.

-- There are 119 democratic states out of a total of 192 countries in 2000, as compared to 22 democratic states out of 154 countries in 1950. In 1948, only 41 nongovernmental organizations had consultative status in the U.N.; now there are 2,091.

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