ESGT - Megatrends Report 2022-2023

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2 | ESGT MEGATRENDS MANUAL

A Special Report by
THE ESGT
MEGATRENDS
MANUAL
An Annual Roadmap for Navigating Risk
and Opportunity in Tectonic Times
2022-2023 EDITION
By Andrea Bonime-Blanc
EDITOR
ANA C. ROLD
ART DIRECTOR
MARC GARFIELD
PUBLISHER
DIPLOMATIC COURIER | MEDAURAS GLOBAL
WASHINGTON, DC
IN PARTNERSHIP WITH
GEC RISK ADVISORY
NEW YORK CITY
DIPLOMATIC COURIER | 3
ABOUT
THE AUTHOR
Andrea Bonime-Blanc, JD/PhD, is Founder and CEO of GEC Risk Advisory,
a global strategic governance, risk, ESG, ethics, and cyber advisor to busi-
ness, NGOs, and government. A former senior global executive at Bertels-
mann, Verint and PSEG, she serves on several boards and advisory boards
(including Crisp, WireX Systems, the Cyber Future Foundation & NACD New
Jersey Chapter), is Independent Ethics Advisor to the Financial Oversight
and Management Board for Puerto Rico, Independent Integrity Advisor to
the Platform for Social Impact. She is a life member of the Council on For-
eign Relations and the recipient of a NACD Directorship 100 Recognition in
2022. Andrea is a sought-after global keynote speaker, a professor of Cy-
ber Leadership and Resilience at NYU, and has authored many articles and
several books, most recently Gloom to Boom: How Leaders Transform Risk
into Resilience and Value (Routledge 2020) and the annual e-book The ESGT
Megatrends Manual 2022-2023 (Diplomatic Courier 2022). She was born and
raised in Germany and Spain, speaks several languages, lives in New York City,
and tweets as @GlobalEthicist.
GEC RISK ADVISORY

GEC Risk Advisory is a strategic advisory firm delivering governance, risk,
ethics, ESG, cyber and crisis advisory services to business, nonprofits and
governments around the world. For more information, please visit: www.
GECRisk.com.
DIPLOMATIC COURIER
Diplomatic Courier is a global media affairs network spanning 182 countries
and five continents, connecting global publics to leaders in international affairs,
diplomacy, social good, technology, business, and more. Our think tank, the
World in 2050, convenes multi-stakeholders in the private and public sectors
through a series of global summits and forums, educational material, research
papers and reports, and digital and print media.
ACKNOWLEDGMENT
The author and the publisher wish to thank Meridian International Center and
the Meridian Corporate Council for their partnership in launching this publica-
tion as part of Meridian’s new Responsible Business Diplomacy Initiative. The
Initiative builds on the foundation of the Meridian Corporate Council’s work to
drive global economic security, prosperity, and innovation by aligning private
and public sector leaders on ESG priorities and the standards required to build
a more sustainable, prosperous world for all.

TABLE OF CONTENTS
1. Welcome Back!
06 The Year Systemic Situational Awareness Became

an Imperative
09 What’s New? The Five Megatrends of 2022-2023
12 Revisiting Key Concepts and Definitions
2. The Five ESGT Megatrends for 2022-2023
16 Megatrend #1
Geopolitical Tectonic Shifts Catalyzing
31 Megatrend #2
Climate and War Propelling Complex Risk
47 Megatrend #3
Tech Disruption Becoming Multidimensional
63 Megatrend #4
Stakeholder Capitalism and ESG Intertwining
79 Megatrend #5
Leadership and Institutional Trust Recalibrating
3. The 2022-2023 Leadership ESGT Blueprint
92 A Leadership Battle Plan to Deal With

92-93 A Leadership Battle Plan to Deal With

93 A Leadership Battle Plan to Deal with Tech

Disruption Becoming Multidimensional
94 A Leadership Battle Plan to Deal With

Stakeholder Capitalism and ESG Intertwining
1. WELCOME BACK!
The Year Systemic Situational Awareness
Became an Imperative
It’s time for the world to recognize that we are living in an era
of continuous risk and crisis and that denying it, avoiding it, or
considering it a passing thing is no longer tenable. The truth is
that the 21st Century has been a century—so far—of periodic, di-
verse, and material environmental, social, governance and tech-
nological (ESGT) shocks to the global system. A look at the (in-
complete) list in Table 1 should suffice to make this point.
Table 1
Most Significant Global ESGT Shocks/Trends of the 21st Century
Event/Trend Year ESGT Type
Climate Change rises and rages 2000-to date E
Cyber becomes a new dimension for action, 2000-to date T
warfare, and crime
Al Qaeda terrorists attack the 2001 G, S
United States
Afghanistan war begins 2001 G, S
Iraq war begins 2003 G, S
Sustainability, ESG start to gather steam 2003-to date E, S, G
Democracies begin to decline worldwide 2005-to date G
The global Great Recession 2008-11 G, S
Arab Spring fizzles and Syrian civil war 2011 G, S
begins
Putin invades Ukraine (Crimea and Donbas) 2014 G, S, T
and the global disinformation wars intensify
Donald Trump is elected U.S. President (with 2016 G, S, T
alleged Russian interference)
UK “Brexit” Referendum (with alleged 2016 G, S, T
Russian interference)
COVID-19 Pandemic hits the world 2019 S
Russia invades Ukraine 2022 G, S, T

A look at Figure 1 from the World Economic Forum’s Global Risks Re-
port 2022 (WEF GRR 2022), which was published before the Russian
invasion of Ukraine, should give pause to the optimists. No less than
89.3% of respondents (2000+ risk professionals) paint a gloomy out-
look for the next three years, while 10.7% indicate that there will be an
“accelerated global recovery.”
Alarmingly, because this survey was taken in late 2021, before the
Russian invasion of Ukraine, it does not factor in that shock to the
global system. If the same people were surveyed in mid-2022, we’d
probably have almost all responding negatively. On the other hand,
the tectonic shifts we are experiencing because of this violent attack
on Ukraine may yield opportunities and even silver linings for the fu-
ture of democracy, the environment, and global energy security.
Figure 1
World Economic Forum Global Risks Report 2022
Outlook Survey
Source: World Economic Forum Global Risks Report 2022 (WEF GRR 2022)
Why is this year’s Megatrends Manual’s subtitle “The Year Systemic

Situational Awareness Became an Imperative”? If there ever was a
time when each of us—whether we are students, managers, officials,
educators, businesspeople, or board members—needed to readjust
our gaze on the horizon, it’s now. After two years of a global pandemic,
dire climate developments and warnings, the first regional brutal war
in Europe in decades and the threat of more of the same for the fore-
seeable future—pandemics, climate catastrophes and war—we must
get out of our comfort zones and understand these new dynamics
so that we can help steer our respective organizations, communities
and nations in the right and most beneficial direction.
Figure 2 helps to make my point—we are used to looking at world

maps with the Americas on the far left or in the middle, but we are
not used to looking at the world from the North or South Poles.
With climate change, seismic geopolitical dynamics, shifting supply
chains, massive migratory changes and more, it is time to adjust our
lenses—glasses, microscopes, and telescopes—to gain a more power-
ful situational awareness to navigate the new, challenging shoals we
are and will be in for decades to come. The answer to the realization
that we are living in a time requiring greater situational awareness is
that being prepared, resilient, agile, and constructive about dealing
with it is the only way to succeed.
Figure 2 - North Pole Map Showing Agriculture

Climate Change 2001-2099
Source: The Economist.
Each year, the ESGT Megatrends Manual examines a handful of ESGT

Megatrends to dissect and illustrate, using some of the best, most useful
data from premier global resources ranging from the World Econom-
ic Forum and major university research centers to the Allianz Risk Ba-
rometer, the Council on Foreign Relations, and other leading practical
thought leadership sources. And we provide cases of both risk and op-
portunity, of downside and upside, that help illustrate the Megatrends.

This publication comes out mid-year for two reasons: 1) ESGT Meg-
atrends are multi-year phenomena and as such don’t begin and end
with any particular annual cycle; and 2) by not piling on other superb
annual publications published at the end or beginning of each calen-
dar year we are actually able to fully take advantage of their wonder-
ful insights, data, and cases in this publication.
The ESGT Megatrends Manual is intended to be a practical handbook

for any type of leader of any type of organization or sector to use as a
big picture guide to understand ESGT context and critical situational
awareness and to help develop actionable ideas for strategy, inno-
vation, resilience, and sustainability. Each megatrend discussion cul-
minates in a “Leadership to Do’s” section providing actionable take-
aways to consider. The E-book ends with a summary overview of all
five megatrends leadership to do’s laid out as an ESGT Megatrends
Blueprint for the coming year.
What’s New? The Five Megatrends

of 2022-2023
Last year’s first edition started with:
We live in tectonic times. We live in systemic times. We live at a

time of deep interconnectedness. We live in times of fast, trans-
formative, and even furious change. We live at a time of glob-
al systemic risk and opportunity. ESGT—environment, society,
governance, and technology—issues, risks, and opportunities are
more deeply (and more rapidly) interconnected and intertwined
than ever before in human history if even only because technol-
ogy has become so intensely fast, disruptive, and life-changing—
for both good and bad.
The above comments apply to this coming year—with a vengeance.
Tables 2 and 3 provide, respectively the new ESGT Megatrends for

2022-2023 and the one’s for last year 2021-2022.
Table 2
The 5 ESGT Megatrends of 2022-2023
MEGATREND #1 – Geopolitical Tectonic Shifts Catalyzing
MEGATREND #2 – Climate and War Propelling Complex Risk
MEGATREND #3 – Tech Disruption Becoming Multidimensional
MEGATREND #4 - Stakeholder Capitalism and ESG Intertwining
MEGATREND #5 - Leadership and Institutional Trust Recalibrating
Table 3
The 5 ESGT Megatrends of 2021-2022
MEGATREND #1 – Tech Disruption at the Speed of Light
MEGATREND #2 – Leadership and Institutional Trust Plummeting
MEGATREND #3 – Complex Interconnected Risk Intensifying
MEGATREND #4 – Global Geopolitical Tectonics Shifting
MEGATREND #5 - Stakeholder Capitalism Rising
The keen eye will note some differences between the first edition and
this one. While the overall themes of the megatrends for both years
have not changed, their priority, rank, and important nuances have.
To save you from figuring it out, below are three more tables:
• Table 4 compares the two years’ reprioritization of the megatrends
• Table 5 shows how each megatrend evolved from a nomencla-

ture standpoint; and
• Table 6 shows the two sets of megatrends side by side with ar-
rows to show their evolution from both a priority and nomencla-
ture standpoint.
The reprioritization and recalibration of each megatrend underscore

the evolution of these multiyear megatrends which, although contin-
uing to exist from year to year, are morphing because of the dynamics
of the global marketplace and conditions, represented by new facts,
data, cases, and developments.

Table 4
2021-2022 Megatrends Compared to 2022-2023
Megatrends – Reprioritization
(Reflecting changes in the priority of each megatrend)
2021-2022 2022-2023
1. Tech Disruption at the Speed of Light 1. Geopolitical Tectonic Shifts Catalyzing
2. Leadership and Institutional Trust 2. Climate and War Propelling Complex
Plummeting Risk
3. Complex Interconnected Risk 3. Tech Disruption Becoming
Intensifying Multidimensional
4. Global Geopolitical Tectonics Shifting 4. Stakeholder Capitalism and ESG
Intertwining
5. Stakeholder Capitalism Rising 5. Leadership and Institutional Trust
Recalibrating
Table 5
2021-2022 Megatrends Compared to 2022-2023 Megatrends –
Redefinition
(Reflecting changing circumstances and nuances for each megatrend)
2021-2022 2022-2023
Tech Disruption at the Speed of Light (1) Tech Disruption Becoming Multidimen-
sional (3)
Leadership and Institutional Trust Plum- Leadership and Institutional Trust Recal-
meting (2) ibrating (5)
Complex Interconnected Risk Intensify- Climate and War Propelling Complex
ing (3) Risk (2)
Global Geopolitical Tectonics Shifting (4) Geopolitical Tectonic Shifts Catalyzing (1)
Stakeholder Capitalism Rising (5) Stakeholder Capitalism and ESG Inter-
twining (4)
Table 6 - ESGT Megatrends Compared 2021/22 to 2022/23

Revisiting Key Concepts and Definitions
If you’re familiar with our first edition from 2021-2022 you will know
the who, what, when, why, and how of the annual Megatrends Man-
ual, but if you are not, below are a few basics:
How Is the Approach to Each

Megatrend Organized?
• Definition and brief explanation of how it fits into the ESGT dis-
cussion—is it primarily an environmental, social, governance, or
technological issue, risk, or opportunity?
• The danger and the risk of the megatrend is explored through
illustrative data, cases, and analysis
• The promise and the opportunity of the megatrend is explored
through illustrative data, cases, and analysis
• Each megatrend discussion concludes with practical, actionable
leadership “to do’s” relating to that megatrend
What Is, and Why “ESGT”?

My readers are probably familiar with the now ubiquitous concept of
ESG (environmental, social, governance) which in the past few years
has become a mainstay of the business and financial world and, in-
creasingly, the regulatory as well as the object of politically polarized
and even bellicose stakeholder discussions.
To level set, here’s a simple definition of ESG from an ESG investment

firm that is typical of what people mean by ESG:
“ESG means using Environmental, Social and Governance fac-
tors to evaluate companies and countries on how far advanced
they are with sustainability. Once enough data has been ac-
quired on these three metrics, they can be integrated into the
investment process when deciding what equities or bonds to
buy.” Source: Robeco 2022.
I have argued elsewhere that ESG (or what I like to call ESGT—see be-
low) is about much more than what the investor community says it is.
Speaking from the standpoint of an entity and its key stakeholders—
whether business, NGO, or even governmental—ESG is about organi-
zational resilience, strategic long-term sustainability, and serving the
interests and expectations of key stakeholders.

I developed the concept of ESG + technology or ESGT in my 2020 book
Gloom to Boom: How Leaders Transform Risk into Resilience and Val-
ue where I made the case that if businesses and other types of organ-
izations are concerned about, and organizing themselves around, the
intangible risks and opportunities that we are calling ESG, they would
make a big mistake to not think of the many and rapidly surging tech-
nological issues, risks, and opportunities we deal with as people, entities,
and nations every day. See Table 7. Quoting myself from a piece I wrote
for the World Economic Forum in late 2020 called “It’s time we added a
letter to ESG. Here’s Why”:
“So, why add ‘technology’—another layer of issues, risks, and

opportunities that are not directly, or just barely, addressed—
to the still-evolving ESG discussion? It’s simple: technology is-
sues—the good, the bad, and the ugly—suffuse everything we
do, every minute and hour of every day.”
Table 7
A Sampling of ESGT Issues, Risks, and Opportunities
What Are “Megatrends”?

The notion of “ESGT Megatrends” also came to me as I was writing
Gloom to Boom. Its first chapter is called “The Ten Megatrends of our
Turbulent Times” designed to provide readers with situational context
and awareness to navigate the remainder of the book, which takes the
reader on a journey navigating through what I called the Scylla and
Charybdis of ESGT, to reach the twin objectives of organizational resil-
ience and sustainable value creation for all relevant stakeholders.
Megatrends are trends that are taking place over multiple years—not
one year, not a quarter, not a month. These are large scale, multifacet-
ed phenomena that are taking place over larger increments of time,
perhaps morphing in new and unpredictable ways, but whose trajec-
tory and impacts are being felt every day, week, month, quarter, and
year. The megatrends transcend physical and virtual barriers and are
developments that touch on major aspects of life on earth—people,
planet, profits, and purpose. Megatrends help provide situational per-
spective and the tools and methodologies for leaders to adapt and
conquer such changes or, in some cases, protect from or combat the
worst manifestations of such changes.
*****
Before we get started, I’d like to share a beautiful, powerful, and resilient
poem from Albert Camus, “The Invincible Summer.” It resonates deeply
for me, and I believe it is profoundly applicable to our tumultuous times.
“In the midst of the hate, I found that there was, within me, an invinci-
ble love.
In the midst of the tears, I found that there was, within me, an invincible
smile.
In the midst of the chaos, I found that there was, within me, an invinci-
ble calm.
I found out that, despite everything, in the midst of winter,

there was, within me, an invincible summer.
And that makes me happy.
For it says that no matter how hard the world pushes against me, with-
in me,
there’s something stronger—something better, pushing right back.”
-Albert Camus. The Invincible Summer. 1953.
I dedicate this year’s edition of The ESGT Megatrends Manual to the

invincible people of Ukraine. Summer is coming.

2. THE FIVE ESGT
MEGATRENDS
OF 2022-2023
MEGATREND #1—GEOPOLITICAL
TECTONIC SHIFTS CATALYZING
Source: A. Bonime-Blanc, Gloom to Boom. Routledge 2020.

Megatrend Definition and Meaning
in the Context of ESGT
IN 2021-2022 FROM… …TO IN 2022-2023

Global Geopolitical Tectonics Shifting Geopolitical Tectonic Shifts Catalyzing
(#4) (#1)
“Freedom must be armed.” -Volodymyr Zelenskyy, April 2022.
This quote from new global democracy hero, Volodymyr Zelenskyy,

President of Ukraine, synthesizes the core meaning of “Geopoliti-
cal Tectonic Shifts Catalyzing.” It is the first megatrend of this year
(evolving from last year’s #4 Megatrend, “Global Geopolitical Tecton-
ics Shifting”) and has moved in importance to the top spot because
already developing international and domestic pressures catalyzed
in early 2022 with the brutal Russian invasion of Ukraine, unleashing
profound reverberations worldwide.
Putin’s aggressive and unprovoked attack on Ukraine of February 24,

2022 presents a rare, historical tectonic moment that will be remem-
bered for years and decades to come as a geopolitical turning point
and a catalyst for other changes. It has singularly caused a moment
of clarity with major implications for global governance, domestic
political governance, societal well-being, and international business.
This megatrend belongs squarely in the category of “Governance”

because it involves governance at several levels—the international
(both governmental and non-governmental) the national (govern-
mental), and corporate governance.
The Danger and the Risk of Geopolitical
Tectonic Shifts Catalyzing
Figure 3
High, Medium, and Low Priority Preventive Conflict Priorities
Source: Council on Foreign Relations. Preventive Priorities Survey 2022.
International Reverberations
They say a picture speaks louder than words and this is true for me
especially when it comes to visualizing data, maps, tendencies, and
other developments. This Council on Foreign Relations (CFR) Annual
Preventive Priorities Survey 2022 world map, based on survey data
collected in late 2021, seems to have it right on where the high, medi-
um, and lower priority global geopolitical governance risks are (even
though the full-fledged Ukraine war begun by Putin on February 24,
2022, had not yet happened at the time of the survey). While the sur-
vey is U.S. centric in that it highlights what is a high, medium, or low
priority for the U.S., it seems to be quite accurate in terms of what is
unfolding globally in 2022.
The lines of a new cold, lukewarm, or even hot global war have been
drawn and it is now clear that those lines are well defined—between
autocracies and democracies, between nations run by strongmen and
nations purporting to be democracies. Domestically, this clarifying
moment may also have major consequences for certain democracies

that have been on the decline, as Figures 4, 5 and 6 demonstrate in
terms of:
• The growing democracy gap—16 years of democratic decline

tracked by Freedom House in Figure 4.
• Fewer people living in “free democracies” over the past 16 years

and fewer countries improving their democratic bona fides over
the same period, with eight out of 10 people worldwide living in
a “Partly Free” or “Not Free” country and only two out of 10 in a
“Free” country according to Freedom House (Figure 5).
• Visualized in map form between closed and electoral autocracies

(in red and orange) and electoral and liberal democracies (in dark
and light blue) in the Our World in Data map shown in Figure 6.
Figure 4
Growing Democracy Gap: 16 Years of Democratic Decline
Source: Freedom House Freedom in the World 2022.
Figure 5
Living in a Less Free World
Source: Freedom House Freedom in the World 2022.
Figure 6
Map of Types of Prevalent Political Regime in 2021
Source: OurWorldInData.org/Democracy 2022.

There are additional reverberations from the Russian attack on Ukraine
from a geopolitical standpoint—some argue that while the new lines
being drawn may appear to be between democracies and autocracies
(to include China in its friendship and “commitment’ to Russia), there
are large democracies (or hybrid systems)—India, Indonesia, and Bra-
zil—that have not taken a side on the war and indeed may not.
Additionally, there are major Asia-Pacific and global governance de-

velopments including:
• The AUKUS agreement in September 2021 pursuant to which the

trilateral U.S., UK, and Australia formed the Indo-Pacific AUKUS
security alliance.
• The Quadrilateral Security Dialogue (QUAD) alliance between

Australia, India, Japan, and the U.S. revived by the Biden Admin-
istration around a “shared vision for a free and open Indo-Pacific”
in March 2021.
• The unprecedented third term for Xi Jinping and the serious do-
mestic developments in China in recent times, including con-
tinuing COVID-19 reverberations (like whole city lockdowns), la-
bor and supply chain disruptions impacting their economy, etc.
• The non-aligned world, or most of the Global South, remains large-

ly on the sidelines of this emerging European regional conflict/war.
Implications for Domestic Politics

As Freedom House has pointed out in its most recent evaluation of
democracies worldwide, Freedom in the World 2022:
“Over the past 16 years, internal forces have damaged the pillars of
freedom in existing democracies:
• Attacking media freedom. Independent media have suffered

from attacks on journalists and blocks on access to information.
• Undermining the rule of law. Politicians and governments have

weakened judicial independence and sought impunity for cor-
ruption.
• Perverting elections. Baseless fraud claims, opaque financing,

and manipulation of electoral rules have undercut public faith in
democratic balloting.
• Discrimination and mistreatment of migrants. Marginalized
communities face discrimination in a variety of areas from politi-
cal participation to asylum rights.
However, with the Russian attack on Ukraine, several interesting do-

mestic political developments have transpired, some of which may
not have happened without the invasion.
• Germany’s new government’s complete 360 on Nordstream 2,

various other energy relationships with Russia, and most surpris-
ingly pledging 2% of its budget to defense and re-militarizing to
assist surrounding countries as well as defend itself from possible
Russian aggression.
• Some shifting and realignment of conservative to right wing pol-

iticians in various democracies to either run away from Putin or
align with him.
• The reelection of President Macron in France against Marine Le

Pen, an ally of Putin.
• The resounding return of liberals in Slovenia, against a Putin ally.

Although Hungary reelected Victor Orban (who is closely aligned
with Putin) there is rising EU discomfort with his continuing deg-
radation of democratic and rule of law principles that might get
Hungary marginalized in the EU.
• The acceleration of Ukraine’s application to join the EU.
The connection between democracy and less corruption and autoc-

racy and more corruption and the idea that Putin’s kleptocracy has
infiltrated market democracies to such an extent that we have been
seriously and materially corrupted and now need to cleanse ourselves
to rescue our democracies is alarming. We explore that further when
we discuss leadership trust in the final megatrend.
Implications for International Business

“When I hear businesses say ‘Babies deserve to have baby food,’ I say
‘Babies in Ukraine deserve to live.’” -Natalie Jaresko, Former Minister
of Finance, Ukraine, during an Athena Alliance Salon on April 13, 2022.
Source, YouTube.
The Ukraine invasion, brutalization and genocide of its people, and

destruction of its cities has given rise to the largest, organized inter-
national anti-country boycott and sanctions since the South Africa
anti-apartheid boycotts of the early 1990s. This has led to the polit-
icization of business—Russia v. Ukraine has put business squarely in
the middle of the democracies v. autocracies debate as well as into a
supply chain restructuring discussion.
Major campaigns have been mounted by pro-Ukraine, anti-Putin

forces to name and shame companies that didn’t quickly, decisively,
and publicly leave Russia—if they were present physically through
people and/or assets—or leave figuratively if they were using Russian
products and services via the supply chain.
Either way, the public opprobrium and debate has been swift, in-
tense, and durable. Witness one of the most notable attempts at
naming and shaming international business doing business in Rus-
sia after the invasion put together by Yale University School of Man-
agement Professor Jeffrey Sonnenfeld via his continually updated
website illustrated in Figure 7.
Figure 7
International Companies Still Doing Business In Russia
Source: Yale University School of Management. 2022. (Accessed on 4.23.22)

Amongst the most critical underlying themes in this geopolitical
global crisis of democracy v. autocracy and domestic crisis of democ-
racy in existing democracies is the scourge of kleptocratic corrup-
tion. One of the reasons why democracies have suffered so much in
terms of the decline of freedoms over the past 16 years (as metic-
ulously documented by Freedom House and The Economist Intelli-
gence Unit) is a dual set of intertwining developments:
1) Complacency about rule of law and democratic rights not needing

care and nurturing in our own democracies, and
2) The slow but highly effective penetration of democracies by klepto-

cratic, corrupt actors—some of them state actors like Putin’s oligarchs
and others purely corrupt local or international business people, politi-
cians, or criminals, who have infected the health of democracies.
However, Putin’s aggression against Ukraine, which elicited broad

coordinated sanctions against Putin’s oligarchs, has revealed the
deep-seated intertwining of the economic interests of the oligarchs
in numerous countries around the world aided and abetted by lo-
cal businesses, professional services firms, and politicians that have
become ensnared in the many headed hydra of these corrupt klep-
tocratic networks. Finally, enveloped in this massive mess is the dis-
information war that has been raging and increasing over the past
decade (more on that under Megatrend #3 Tech Disruption Becomes
Multidimensional).
This has serious implications for all businesses no matter where they
are located or what footprint or profile they hold. As the Yale Uni-
versity Russian business tracker demonstrates, no one is safe from
the potential reputational and financial consequences of being or
appearing to be associated with the dark, corrupt side of the Putin
regime. It behooves businesses to pay close attention, understand
what their stakeholders expect from them on Russia and related is-
sues, and devise an action plan that is consistent with their deemed
mission, vision, values, and purpose.
The results of Just Capital’s surveys of U.S. public company stakehold-

ers (they measure five: workers, communities, shareholders, environ-
ment, and customers) provide some important insights into what
stakeholders expect from business on these and related ESG issues,
risks, and opportunities. Significantly, 70% of stakeholders expect large
companies to have a great deal or some responsibility to protect the
democratic process, and 81% of stakeholders say it is important that
large companies publicly report data about their impact on society
regarding political donations and lobbying. See Figures 8 and 9.
Figure 8
2022 Survey On Large Company Social Responsibilities
Source: Just Capital 2022.
Figure 9
2022 Survey On Large Company Responsibility for
Reporting Social Impact Data
The Promise and the Opportunity of

Depending on where one sits both geographically and in terms of
whether they favor democracy, they may view the first few months
of 2022 with either a hopeful eye (if democracy is their thing) or a
more suspicious eye (if what they like is more autocracy). Either way,
there is little doubt that the first few months of 2022—catalyzed by
the Russian invasion of Ukraine—shook global geopolitical tectonic
plates into greater definition and clarity.
Table 8 provides an overview of just some of the major events taking

place in early 2022 that help illustrate how much the “geopolitical
tectonic plates” were shaken in such short a time. But let there be no
doubt about it: these seismic shifts were building up for some time.
Table 8
Early 2022: Months that Shook Global Geopolitical Tectonic Plates
• NATO is more unified today than in most of its multi-decade
history and expects to expand to new members (Finland and
Sweden).
• NATO will have a new Strategic Concept document in June
2022, which will outline their strategic posture for the coming
decade—something that without the Ukrainian invasion may
have been very different.
• The EU is more unified today than ever in its history.
• NATO Cyber cooperation while relatively cohesive in the past,
is now turbocharged and more coordinated than ever
• The United Nations roundly condemns the Russian invasion
with a majority of nations voting against Russia, with a pivotal
speech from the Kenyan Ambassador.
• The alliance of nations imposing dramatic sanctions on Russia
goes beyond the EU and NATO to include South Korea, Japan,
and Australia.
• Formerly neutral European countries—Finland, Sweden, and
Switzerland—have broken their neutrality and have expressed
an interest in joining NATO and/or the EU.
• Formerly right-of-center EU/NATO members (Poland comes to
mind) have realigned with democracies in no uncertain terms,
though their long-term status remains unclear (as the recent
reelection of Victor Orban as President of Hungary, for yet an-
other term shows).
• China, suffering from a resurgence of COVID-19 cases and
other economic woes, potentially suffers the consequences
of aligning too closely with Putin and antagonizing the global
marketplace.
• India, traditionally an ally of Russia, remains in contact but be-
gins to show signs of maybe disengaging a little.
It would appear from the many statements we are hearing from lead-
ing democracies (the U.S., European countries, and several Asia-Pa-
cific countries) and western democratic country alliances (NATO,
EU) that the lines between the autocratic world and the democratic
world are being etched as perhaps the new global divide. Moreover,
this divide is reflected in the fight between the far right, anti-demo-
cratic forces and the right, center and center left within democracies,
as well as in the corporate world where political polarization is creep-
ing into risk governance, decision-making, strategy, private/public re-
lationships, and talent management.

Unlike last year, when we were positing the possibility of a democ-
racy v. autocracy division of the world, now we can actually say that
not only is this the case but that the events of February 24, 2022, with
Putin’s invasion of Ukraine have done more to rehabilitate the appeal
and value of democracy than anything else in the last few decades.
Indeed, the Ukrainian esprit de corp and intensely emotional defense of

democracy and freedom has become infectious in other democracies
leading some scholars and observers of these regimes to note that this
could be a turning point for democracies, which as Figure 4 above from
Freedom House have been in serious decline over the past 16 years.
Thought leaders on this topic, like Michael Abramowitz, Executive Di-

rector of Freedom House, are speculating that the dramatic geopo-
litical events of this year may already be providing a boost to democ-
racies as the populace and leaders of democracies that have been in
decline (and perhaps illiberal societies yearning for more democracy)
see the benefits of more freedom rather than less:
The Washington Post, April 2022 Ishaan Tharoor
The implications of these changes to business are complex and mul-

tifaceted but if your business is largely in democracies and your rev-
enues are politically neutral or come from mostly democratic, liberal,
or progressive customers and markets, how you handled the Russian
boycott will have greater, or lesser reputational and financial deleteri-
ous consequences on you. Figures 8 and 9 above provide some feed-
back from Just Capital surveys of stakeholders of the largest publicly
traded companies in the United States that point in a very strong
direction that key stakeholders expect business to be responsible for
a wide variety of social and political issues.
Indeed, when it comes to political disclosure—such as those associ-

ated with political contributions, the polarization or political divide
between republicans and democrats in the U.S.—is not that great
as per Figure 11, and thus as companies navigate these complex
waters it would behoove them to stick to their professed purpose
and cater to their key stakeholders’ expectations and wishes.
Figure 10
2022 Survey Showing Bipartisan Support
for Corporate Disclosure
Source: Just Capital.

A Leadership Battle Plan to Deal With
AN ESGT LEADERSHIP BLUEPRINT FOR 2022-2023

Megatrend #1 KEY LEADERSHIP ACTIONABLE TACTICS
1. Leadership teams (management and boards) must have
Geopolitical Tecton- access to real time international geopolitical, national, and
ic Shifts Catalyzing local political data and advice relating to their strategic
footprint, geography, supply chain, and planning.
2. A designated member of management should oversee

geopolitical and political developments with the assistance
of solid intelligence and advisors reporting to c-suite and
board periodically and coordinating in real time with risk
management.
3. Add geopolitical risk and opportunity considerations to

the yearly budgeting and strategy planning exercises.
4. Understand how international and national politics affect

your business/entity through the eyes of your stakeholders.
Understand the reputation risk and opportunity embedded
in such views and add them to corporate/entity internal
and external messaging and communications.
5. Make sure all political content messaging is 100% aligned

with your organization’s purported mission, vision, values,
and purpose.
MEGATREND #2—CLIMATE AND WAR
PROPELLING COMPLEX RISK

IN 2021-2022 FROM… …TO IN 2022-2023

Complex Interconnected Risk Climate and War Propelling Complex
Intensifying (#3) Risk (#2)
Just when we thought that the pandemic and/or climate change
were the drivers of the “complex interconnected risk” we talked about
last year, this year what was Megatrend #3 becomes Megatrend #2—
Climate and War Propelling Complex Risk—as a major war enters the
world of interconnected complex risk. That war engenders a series
of societal (humanitarian, mental health, food security) and techno-
logical (cyber and disinformation warfare) foreseen and unforeseen
consequences that have propelled complex interconnected risk to
new heights this year.
The basic premises of what we talked about last year remain in

place—the world is becoming increasingly complex, increasingly
risky, and increasingly interdependent. This year, with the worsening
of climate trends, the continuation of the pandemic (though some-
what abetted but with the expectation that new pandemics will be
with us again), and the outbreak of the largest, most complex land
war in Europe since WWII, the reverberations of complex intercon-
nected risk will continue to manifest themselves. Below we examine
three such reverberations leaders should keep their eyes on.
1. Climate trends continues to deteriorate worsened by the twin ef-

fects of pandemics and war.
2. War interconnects with massive foreseen and unforeseen societal

and humanitarian crises, including mass migration, global food cri-
ses, and supply chain disruption.
3. A strange new silver lining emerges from the current cluster bomb
of interconnected risk: the recent deep dependency on Russian and
other autocratic regimes for oil and gas turbocharges reasons for
developing renewable energy sources, possibly returning to nuclear
and accelerating the overall energy transition.
While this megatrend is primarily about climate change as the most

pervasive and long-term set of risks and opportunities confronting
life on earth today, it is closely followed by the governance crises and
challenges thrown up by the Russian war on Ukraine, and the con-
comitant deep and damaging societal reverberations therefrom, al-
ready prepped and exacerbated by two years of COVID-19.

The Danger and the Risk of Climate
and War Propelling Complex Risk
Complex Interconnected Risk Propelled
What we have seen over the past year are increasingly more alarm-
ing climate developments and climate analyses that point in one
direction and one direction only: a dramatically heating world, the
multi-risk effects, causation and correlation that such heating has on
other big categories of risk (economic, social, technological, geopo-
litical, and governance) and how inaction, meek and uncoordinated
global action, bad-action and the effects of other global calamities
like pandemics and wars, will continue to impede and even oblite-
rate existentially needed global progress.
For those unfamiliar with the WEF GRR annual reports, they provide
surveys and data around five major categories of global strategic risk
defined as: “The possibility of the occurrence of an event or condition
that, if it occurs, could cause significant impact for several countries
or industries.”
The five categories of risk examined in the WEF GRR Annual Reports
are the following (showing examples of each):
1. Economic.
• Asset bubble bursts in large economies.
• Collapse of a systemically important industry.
2. Environmental.
• Biodiversity loss and ecosystem collapse.
• Extreme weather events.
3. Geopolitical.
• Collapse of multilateral institutions.
• Geopolitical contestation of strategic resources.
4. Societal.
• Collapse or lack of social security systems.
• Employment and livelihood crises.
5. Technological.
• Adverse outcomes of technological advances.
• Breakdown of critical information infrastructure.
The World Economic Forum’s GRR 2022 graphic below (Figure 11)—
showing the interconnectedness of primarily environmental and so-
cietal issues—once again speaks louder than words. Indeed, the top
10 global risks forecast for the next 10 years (see Figure 12 assembled
prior to the beginning of the Ukraine war), also underscores how im-
portant it is for decisionmakers regardless of role, location, or sector,
to understand how environmental and societal issues are deeply and
inseparably intertwined, made ever so by the new geopolitical and
geo-economic consequences of the war in Europe.
Figure 11
World Economic Forum - Global Risks Effects 2022
Source: World Economic Forum Global Risks Report 2022.

Figure 12
Most Severe Global Risks For The Next 10 Years
Source: World Economic Forum Global Risks Report 2022 (WEF GRR 2022)
The War
Indeed, the WEF GRR 2022 report was prescient enough to state the
following (again, prior to the Ukraine war happening):
“Geo-economic confrontations” will emerge as a critical threat to the

world in the medium and long term and as one of the most potentially
severe risks over the next decade. While pressing domestic challenges
require immediate attention, the pandemic and its economic conse-
quences have proven once again that global risks do not respect po-
litical frontiers. Humanity faces the shared and compounding threat
of economic fragmentation and planetary degradation, which will re-
quire coordinated global response.”
-Source: World Economic Forum. Global Risks Report 2022.
Given that the Russian invasion of Ukraine had not yet begun when
the WEF GRR 2022 was published in January 2022, we only see one
geopolitical risk highlighted as serious risk #10 for the coming decade
“geo-economic confrontation” defined above. But it bears looking at
the additional Geopolitical Risks WEF generally identifies in the 2022
report as these may become much more relevant to the short- and
medium-term future because of the Ukraine war. See Figure 13.
Figure 13
World Economic Forum - 2022 Geopolitical Risk Categories
Source: World Economic Forum. Global Risks Report 2022.
The Climate Conundrum
Source: Diplomatic Courier
Figures 14 and 15—one from the WEF GRR 2022 showing very dire
scenarios for global temperatures by 2100 and the other from NOAA,
the U.S. Agency that evaluates and reports on climate issues and
provides annual catastrophic climate financial impact studies and
charts, show dramatically the climate truth and climate consequenc-
es of climate inaction.
Climate Truth…
Figure 14
Global Temperature Scenarios By 2100
Climate Consequences…
Figure 15
2021 U.S. Billion Dollar Weather and Climate Disasters
Source: NOAA 2022.

There are a couple of major interconnected or cluster risks relating
to climate, geopolitics in the societal realm: the risk of forced, invol-
untary migrations—happening because of poverty, violence, climate
change, political conditions, and war. Figures 16 and 17 show such se-
rious risk clusters: 1) that the volume of refugees and asylum seekers
over the past 20 years has been steadily increasing, especially in the
last half decade; and 2) how poorer countries are at vastly greater risk
of physical climate shocks and thereby income inequality.
Figure 16
Refugees, Asylum Seekers & Displaced Persons 2000-2020
Source: World Economic Forum Global Risks Report 2022
Figure 17
S&P Global Ratings -
Climate Change
and Greater Risk In
Poorer Countries
Source: Bloomberg April 26, 2022.

The Business Lens on Interconnected Risk
Bringing the “complex interconnected risk” lens a little closer to day-
to-day business, the annual Allianz Risk Barometer (ARB) provides
a bird’s eye view of the top business risks for 2022. See Figure 18. In
contrast to last year when the Allianz Risk Barometer 2021 signaled
the “Covid Trio”—cyber, business interruption, and the pandemic—this
year cyber returns to the top of the list closely joined by the other two
and a fourth risk—natural catastrophes.
Perhaps business (and other organizations) needs to think of the “In-

terconnected Quad”—of cyber, pandemic, climate, and business inter-
ruption—as threats that are likely to stay at the top of business risks,
affecting, correlating and/or having potential causational relation-
ships with each other, exacerbating risk for those who do not build
sustainable resilience measures.
Figure 18
Allianz Risk Barometer — 2022 Most Important Business Risks
Source: Allianz Risk Barometer 2022
Indeed, Figures 19 and 20 provide further evidence and data about
how business will be preoccupied and tackling head-on both cyber
insecurity and supply chain disruption for the foreseeable future.
Once again, climate, pandemics, and the war will be complicating in-
terconnected factors further propelling the level, extent, and reach of
such risks especially for entities that do not prepare properly for these
pervasive risks. Those who do will be their more successful resilient
peers and competitors.
Figure 19
Supply Chain Bottlenecks 2007-2021
Figure 20
Global CEO Survey
Shows Cyber-Attacks
as Greatest Threat
to Growth
Source: PwC CEO 2021 Survey.

The Promise and the Opportunity of
Even though the news and recent global developments have been
undoubtedly on the high risk, gloomy side of things, there are always
opportunities embedded in risk and potentially silver linings as well.
On the climate front, despite the ongoing inability to even make
a small dent on emissions worldwide, and the fact that emissions
have gotten worse in the past year, despite COP26 and the ongoing
climate engagement worldwide, it is possible to distinguish several
positive developments with potential long-term upside.
For example, there may be a boost to the green energy transition oc-
casioned by the shift from reliance on Russian oil and gas undertaken
for geopolitical and domestic political reason. The fact is that we have
made some substantial progress for several decades in various areas—
witness the anecdotal evidence embedded in Figure 21 about the im-
provement over the past four decades of air pollution in Los Angeles.
Figure 21
Los Angeles Air Quality Index Improvements 1980-2021
Source: The Economist 4.24.22 and the U.S. EPA.
Though frustrating, there is continual engagement on the topic of

climate change through multiple important venues, the most visible
of which is COP (with Glasgow being the host of COP26 and Egypt
to host COP27 November of 2022). Below are some of the key takea-
ways from COP26, Glasgow, November 2021:
• India pledged to reach net zero emissions by 2070, with a renew-

able energy target of 50% by 2030.
• 46 countries pledged to transition from coal to clean energy
by 2040.
• 104 countries pledged a 30% reduction in methane emissions

by 2030.
• 141 countries, accounting for 91% of global forests, pledged to

end deforestation by 2030.
Though many are worried about the worst or second to worst case
scenarios for global greenhouse gas emissions (the current pathway
takes us to 2.7 to 3.1 and the pledged pathway to 2.1 to 2.4 degrees
Celsius increase by 2100), others are optimistic that we can do better
than that. The consensus is that we need to push for less than a 1.5-de-
gree Celsius increase if we are to avoid some of the more catastroph-
ic climate consequences. See Figure 22 showing the four estimated
temperature trajectories.
Figure 22
Pathways of Global Greenhouse Gas Emissions 2000-2100
Source: The New York Times 2022.

There is good news in all this on the business front as well. Just Cap-
ital has named the following U.S. public companies “America’s Top
Ten Companies for Environmental Performance in 2022” based on an
in-depth analysis of their environmental policies, disclosures, com-
mitments, and strategy. See Table 9.
Table 9
Just Capital’s “America’s Top 10 Companies
for Environmental Performance in 2022
1. VMware
2. Microsoft
3. Intuit
4. Apple
5. Moody’s
6. Mastercard
7. PayPal
8. Etsy
9. HP Inc.
10. PVH Corp.
Source: Just Capital.
Finally, other developments are militating in favor of a more con-

scientious approach to climate change management in many differ-
ent quarters—from the financial sector, insurance sector, investment
world, consumers of products and services, talent search, and reten-
tion. This more conscientious approach may be too little too late but
it has a chance of gathering momentum, especially as the downsides
of climate denial and outright negligence continue to swirl around us.
Another silver lining to the terrible destruction and warfare taking place
in the heart of Europe today is that not only will it help potentially with
the green climate transition, it is already helping with creating more cy-
ber-resilience and private-public collaboration and operationalization of
cyber-resilience than we have ever seen before. This is also bringing into
much greater relief the importance of resilience generally.
How to build resilient organizations was a core part of my book

Gloom to Boom where Chapter 7 “Metamorphosis: Achieving Organ-
izational Resilience” offers an exploration of four types of organiza-
tion depending on how well developed their eight elements of or-
ganizational resilience are.
Figure 23 shows a bird’s eye summary overview of each of these forms

of organizational resilience lifecycle—and it pays to be on the high re-
silience side of this spectrum: The Robust Resilience Lifecycle or even
better the Virtuous Resilience Lifecycle.
Figure 23
Four Models Of “Organizational Resilience”
Source: A. Bonime-Blanc. Gloom to Boom. Routledge 2020.
To end on a positive note, there are some great studies showing how
companies that invest in innovation and resilience during times of cri-
sis outperform those who do not. This is about value protection, sus-
tainability, resilience, and value creation after all. See Figure 24.
Figure 24
Innovative Companies Are More Resilient


1. Does the organization have an Enterprise Risk Manage-
Climate and War ment framework? Make sure climate, geopolitical and
Propelling societal risks are part of the considerations.
Complex Risk
2. What’s the state of your risk governance and oversight?
• Is the board of directors risk-savvy and experienced?

• Is there a risk oversight committee?
3. Does the company have a savvy Chief Risk Officer and

team? Do the team members have the resources and tools
necessary for foresight and futureproofing?
4. Is there a crisis management plan and team, including a

board liaison or member? Is scenario planning integrated
into such plans and periodically conducted?
5. Is there organizational resilience management and over-

sight, business continuity, and data protection? What’s the
state of your organizational resilience?
MEGATREND #3—TECH DISRUPTION
BECOMING MULTIDIMENSIONAL

IN 2021-2022 FROM… …TO IN 2022-2023

Tech Disruption at the Speed of Light Tech Disruption Becoming Multidimen-
(#1) sional (#3)
Tech Disruption Becoming Multidimensional means disruption con-
tinues apace just like last year but it’s becoming increasingly clear
that much of this disruption is taking place in multiple dimensions.
We used to just have the “real” world and the “internet.” Over the
years, other related dimensions have popped up and evolved into
bigger and more extensive areas of reality or unreality—virtual games,
social media, internet, dark/deep web, space, and cyber. Now we also
have the metaverse, crypto, blockchain, NFTs, the deep dark world
of disinformation, surveillance capitalism, quantum computing, the
nanosphere, Web 3.0, etc.
This megatrend belongs squarely in the category of “Technology” be-

cause it’s first and foremost about technology and innovation. But it
is also heavily about governance as all of the issues, risks, and oppor-
tunities associated with the development of multi-dimensional tech
require governance in one form or another and, more importantly,
governance, risk, and ethics innovation to understand and adapt to
these new dimensions to keep people and planet safe from the in-
tended and unintended negative consequences.
The Danger and the Risk of Tech

The Metaverse and its Denizens

“What happens in the Metaverse* doesn’t stay in the Metaverse*”
*(replace with: Cyber, Blockchain, Crypto, Quantum, Space, etc.)
At a tech conference I spoke at recently, I made the above quip to de-

scribe my reaction to the much-touted emergence of the Metaverse,
especially as announced by Mark Zuckerberg as he renamed Face-
book “Meta” in this video).

So, what is the Metaverse? Here’s a good definition from Investopedia:
“The metaverse is a digital reality that combines aspects of social media,

online gaming, augmented reality (AR), virtual reality (VR), and crypto-
currencies to allow users to interact virtually. Augmented reality overlays
visual elements, sound, and other sensory input onto real-world settings
to enhance the user experience. In contrast, virtual reality is entirely vir-
tual and enhances fictional realities.”
What prompted my contortion of the old Vegas saying is that wher-

ever humans roam—whether it is in the physical world, the virtual
world, or outer space, the possibility and even certainty of unexpect-
ed, unbridled bad or damaging behaviors is likely to follow closely.
While I am a believer in the essential goodness of humanity and that

most humans are essentially well intentioned, we sadly live in a world
where the few ill-intentioned, ill-incentivized, power hungry, and cor-
rupt will seize the reins of the day. It is because of that minority of
power-seeking bad actors that most of humanity must be protected
from the intended and unintended negative consequences of the
wildly optimistic, innovative, inventive yet often power-hungry, pushy
and/or megalomaniacal few through good governance, effective risk
management, and actionable ethics.
The Metaverse will be yet another “location” for churlish, nasty, re-
pugnant, or even criminal behaviors as the following troubling head-
lines denote:
• “Metaverse App Allows Kids into Virtual Strip Clubs” BBC, Febru-
ary 23, 2022.
• “Woman Says She Was ‘Gang-Raped’ in Facebook’s Metaverse”

Vice News, February 1, 2022.
• “How will Facebook Keeps its Metaverse Safe for Users?” Financial
Times, November 12, 2021.
• “Come the Metaverse, Can Privacy Exist?” Wall Street Journal,

January 4, 2022.
• “The Metaverse is Everything you Hate about the Internet

Strapped to Your Face” Grid, February 4, 2022.
And my personal favorites:
• “Why the Hell Are People Getting Married in the Metaverse? The
Bride Wore Blockchain” Daily Beast, April 23, 2022.
• “Virtual High? Rapper Snoop Dogg Wants to Grow Weed in the

Metaverse” Bitcoinist, April 22, 2022.
A Technopolar World?
Adding to the phenomenon of a possible Metaverse (or other “verse”)
is the increasing power and control—beyond borders and despite
them—of Big Tech and even more so of the Big Tech elite. A late 2021
article by Ian Bremmer for Foreign Affairs titled “The Technopolar
Moment: How Digital Powers Will Reshape the Global Order” con-
nects the dots between the super-powerful tech elite, geopolitics,
and the increasingly borderless future of the world. In essence, he
points out that:
• Technological companies are increasingly geopolitical actors in

and of themselves.
• Technological companies are shaping the global environment in
which governments operate.
• Governments and technology companies are poised to compete
for influence.
• Big Tech is transforming human relationships.
• People are increasingly living out their lives in digital space, which
governments cannot fully control.
And therein lies the rub: we are living through the boldest transfor-
mation of humans in history because tech is altering our behaviors,
and the physical barriers that existed for centuries and millennia are
disappearing (with a few exceptions). We really don’t know how this
unfolds. That is exactly why creating the proper governors, risk pa-
rameters, and ethical boundaries in real time as these tech changes
unfold isn’t just desirable. It is necessary. And so is the rising, dire
need for trustworthy, non-corrupt leaders as I discuss under Meg-
atrend #5 “Leadership and Institutional Trust Recalibrating.”
That brings us to Figure 25, which shows the current state of interna-
tional risk mitigation efforts as compiled by the WEF GRR 2022. While
the general tenor of the Figure is alarming in that many critical risks
of all kinds are not properly addressed from a risk mitigation stand-
point, it is several critical technology risks that are the least well-han-
dled, indeed the top three least mitigated risks, to wit:
• #1 least mitigated: Artificial intelligence.
• #2 least mitigated: Space exploitation.
• #3 least mitigated: Cross-border cyberattacks and
misinformation.
Figure 25
Current State of International Risk Mitigation Efforts
What is the significance of this to humanity? We need to pool our re-
sources together across borders, sectors, and industries in a public/pri-
vate/nonprofit way to build the governance, risk and ethics safeguards
necessary to protect humanity. If we don’t, it’s only a matter of time
before these risks become material, global, and potentially existential.
Digital Distortions
Another dimension of the tech multidimensional disruption contin-
ues to be one quite familiar to all of us: cyber but with an important
twist. The third one listed in the WEF most unmitigated list is “Cross
Border Cyberattacks and Misinformation” brings me to another
deeply important “verse” in our limited exploration of the multidi-
mensional “verses”: the cyber-verse or the place where cyber-attacks
and the world of disinformation, misinformation, and weaponization
cohabitate and meet.
But first, let’s set the record straight on something that suffuses our
daily lives: the global pervasiveness of fake information, disinforma-
tion, mal-information, and misinformation. According to the Edel-
man Trust Barometer 2022, fake news concerns were at an all-time
high. In 27 countries, the answer to the question “I worry about false
information or fake news being used as a weapon” went up 4% points
from 2021, with Saudi Arabia clocking by far the largest percentage
gain (+18%) and several African and Asian countries also striking no-
table increases from 2021—Kenya with 10%+ and China and Indonesia
at 9%+. See Figure 26.
Figure 26
Fake News Concerns at All Time Highs 2022
Source: Edelman Trust Barometer 2022.

Figure 27 shows a Venn diagram that explains categories of informa-
tion disorder where there is 1) false information “Misinformation” and
there is 2) intentionally harmful information “Malinformation” and
where the two overlap we call it “Disinformation.”
Figure 27
Categories of Information Disorder
Source: Crisp Presentation 2022.
It is critical to put this development into context. The volume, ve-

locity, and sometimes ferocity of the unleashing of information and
disinformation suffusing social media today is not only breathtaking
but unbridled. Let’s start with the fact that there are almost 4.5 billion
individuals on earth who have social media accounts. And let’s con-
tinue by looking at the breathtaking volume and speed of informa-
tion spread on social media every 60 seconds of every single day and
the problem becomes exponential. See Figure 28.
Figure 28
What Happens In Data Every 60 Seconds Around the World

At Crisp, an actor risk intelligence firm, the focus is on understanding
and finding the actors that engage in the phenomenon of “Digital
Chatter” in the deep and dark webs before they weaponize misinfor-
mation and disinformation on the surface web and social media. To
quote an article I co-wrote with Vikram Sharma, President of Crisp:
“Digital chatter comprises all the conversations happening among users online,
whether on the surface or the deep web. It includes open, indexed, and closed,
and dark social media channels. It also includes forums and messaging apps.
Several recent examples include the deliberate use of social media influencers to
attack COVID-19 vaccine providers, the online planning of an insurrection at the
U.S. Capitol, and the coordinated efforts by a subreddit to short squeeze stocks.
Companies are taking notice: A recent Crisp survey of more than 100 corporate
leaders, most CEOs from companies with revenue over $1 billion, found that—
similar to what happened with cybersecurity 10 years ago—61% report their
boards and leadership teams are already pursuing new skills, capabilities, or re-
sources to keep up with risks that originate from or become amplified online by
digital chatter.”
Surveillance Capitalism:
A Many Headed Hydrae
Another area of multidimensional tech disruption is what has been
coined to be “surveillance capitalism.” I like to think of it as a many
headed hydrae—when you cut off its heads, additional ones sprout
up. In this era of exponentially transforming technology this is a big
problem for everyone.
Simply put, “Surveillance Capitalism” is a recent technologically ena-

bled form of capitalistic economic power where the capitalists (tech
firms) harvest private data (largely unbeknownst to its donors (us).
In exchange, we (the donors) get “free” social media or platform ex-
periences like Facebook, Instagram, Twitter, and TikTok. In turn, tech
firms monetize our “free” data via advertising and other data selling
techniques into millions and billions in revenue.
Think about it as a compendium of everything the great author Sho-

shana Zuboff crammed into the following fulsome definition in The
Age of Surveillance Capitalism: The Fight for a Human Future at the
New Frontier of Power:
“Sur-veil-lance Cap-i-tal-ism, n.
1. A new economic order that claims human experience as free raw material for
hidden commercial practices of extraction, prediction, and sales; 2. A parasitic
economic logic in which the production of goods and services is subordinated
to a new global architecture of behavioral modification; 3. A rogue mutation of
capitalism marked by concentrations of wealth, knowledge and power unprec-
edented in human history; 4. The foundational framework of a surveillance
economy; 5. As significant a threat to human nature in the twenty-first century
as industrial capitalism was to the natural world in the nineteenth and twenti-
eth; 6. The origin of new instrumentarian power that asserts dominance over
society and presents startling challenges to market democracy; 7. A movement
that aims to impose a new collective order based on total certainty; 8. An expro-
priation of critical human rights that is best understood as a coup from above:
an overthrow of the people’s sovereignty.”
A recently exposed example of deleterious surveillance capitalism oc-

curred involves NSO, an Israeli-based, privately held technology com-
pany founded in 2010 until recently primarily known for its proprietary
spyware Pegasus, which is capable of “remote zero-click surveillance
of smartphones” and was supposedly sold only to and used by govern-
ments and law enforcement (and, by implication, not the “bad guys”
according to NSO). It is a technology that is surreptitiously embedded
into people’s phones without their knowledge, and which tracks their
every move, content, and communications.
What could go wrong? Just about everything. An obvious problem

is that not all governments or law enforcement agencies are created
equal in terms of observing proper rule of law or human rights pro-
tections. While one can posit that authoritarian regimes and the usu-
al underworld suspects (criminals, hackers, and spies) will not com-
ply, sadly, democratic governments, their agencies, and politicians
cannot be trusted either, nor can private interests for that matter.
Witness the recent revelations of the use of Pegasus by ruling party
Polish government officials against out-of-office democratic political
party contenders in (mostly) democratic Poland.
Thus, is born another nuance in the story of Surveillance Capitalism.

The implications for all manner of business, NGOs, educational, and
research organizations everywhere couldn’t be clearer: when and
if a competitor, hostile government, criminal, or underworld entity
wants to get protected information and data from one or more of
your people, all they need to do is to pay NSO (or one of their compet-
itors) for this kind of surveillance.
Meta issued an alarming “Threat Report on the Surveillance for Hire

Industry” in which, among other things, they conclude that a “glob-
al surveillance-for-hire industry” has emerged that targets individu-
als for the collection of data, intelligence and the manipulation and
compromise of their devices and accounts. The Report calls these en-
tities “cyber mercenaries” and (like NSO in its public statements) claim

to only target “criminals and terrorists.” However, this months-long
study showed that the net of people caught in this mostly nefarious
practice includes human rights activists, political opponents in both
democratic and authoritarian regimes, as well as journalists and oth-
er private citizens.
The Promise and the Opportunity of Tech

What Are We To Do?
While the above headlines focus on the Metaverse and other mul-
ti-dimensional tech developments are alarming, they point in one
direction that some governments—most notably the EU—have be-
gun to tackle from a privacy protection, data collection, and protec-
tion standpoint but it is truly an uphill battle. How leaders and or-
ganizations handle these multidimensional tech developments and
their challenges from a governance, risk management, and ethics
perspective will have major effects on their success or failure—at the
end of the day, stakeholder trust is in the balance.
There are a few things leaders of every type of entity—whether in

business, NGO, education, research, media—can do, to wit:
1. Deploy appropriately sophisticated and effective cyber-security pro-

tections at all key entry points guarding crown jewels (including data).
2. Establish disciplined governance, quality and ethical filters and

protocols to prevent/disable the implanting of dangerous software
and/or misuse of data.
3. Scrub—and have the talent to understand how to scrub and evalu-

ate—supply chain software coming in and going out.
4. Prevent the illegal (and even legal but problematic) use of spyware
in the workplace (in and out of the office including work from home)
to track employee movements, productivity, communications, and
other activities.
5. Understand that external surveillance tech may very well be de-

ployed against its own employees, executives, and board members
by nefarious competitors, officials, criminals, or other bad actors, and
be prepared from a crisis management standpoint to deal with it.
6. Have a transparent policy framework, related training and com-
munications for all affected stakeholders explaining what the
entity does to protect them, providing reporting helplines and
protocols to protect against data and tech misuse and abuse.
7. Gauge the challenge of maintaining high ethical, legal, and

transparency standards in the various countries you are pres-
ent in—you will be challenged and thwarted in authoritarian
countries (and maybe even in some democratic or hybrid ones).
8. Understand the essential nature of private/public collaboration

while being cognizant of the dangers thereof especially in less than
democratic countries.
A final and critical component for dealing with the multiplying chal-
lenges of surveillance capitalism and related tech issues is that all
entities need to have tech savvy executives and boards who under-
stand the need for a permanent, cross-functional, transversal team of
internal and external experts looking at these interconnected issues
as they affect the entity, the sector, and the stakeholders in real time
and continuously.
At a time when we are in dire need of good news, here are three excellent
examples of deploying cutting-edge technologies to achieve ESGT good:
Table 10
What’s Next? 22 Emerging Technologies to Watch In 2022
Solar geoengineering Heat pumps Hydrogen-powered
planes
Direct air capture Vertical farming Container ships with sails
VR workouts Vaccines for HIV and 3D-printed bone implants
malaria
Flying electric taxis Space tourism Delivery drones
Quieter supersonic air- 3D-printed houses Sleep tech
craft
Personalized nutrition Wearable health trackers The metaverse
Quantum computing Virtual influencers Brain interfaces
Artificial meat and fish
Source: The Economist. The World Ahead. November 21, 2021.

1) Table 10 based on an Economist “The World Ahead 2022” feature
shows 22 technologies that are currently under development and are
designed to do mostly ESGT good, especially in areas of climate-tech
and health-tech, often through the multidimensional tech world in-
cluding Space, Quantum, the metaverse, etc.
2) Figure 29 from the Edelman Trust Barometer provides some hope-

ful feedback on one of the most intractable problems of our times:
how to combat misinformation and disinformation. Their conclusion:
Information quality is the most powerful contributor to institutional
trust building. We are possibly seeing the beginning of a tide against
disinformation taking place once again through the Ukraine war
where both the U.S. and the Ukrainian governments have shown
great savvy in combatting Russian misinformation and where civil
society entities have too.
Figure 29
Information Quality Is an Institutional Trust Builder
3) Finally, there are many private and public efforts, at the govern-
ment level, company level, association level, research level, and pri-
vate/public levels to create governance, risk, and ethics parameters
for the variety of technologies under development. Figure 30 shows
one such from an unexpected place: The Business Roundtable, which
is represented by the CEOs of 100+ largest U.S. companies.
Figure 30
Source: The Business Roundtable 2022.

A Leadership Battle Plan to Deal with Tech

1. Figure out what tech dimensions are relevant to your
Tech Disruption footprint and pursue the necessary governance, risk man-
Becoming agement and ethical boundaries around it.
Multidimensional
2. Undertake a technology stakeholder analysis relevant to
your business footprint to understand what your stake-
holders’ tech expectations are.
3. Ensure cyber-hygiene. What is the state of cyber-security

risk management at your organization? Is it effective?
4. Ensure that your organization is vigilant about informa-

tion and data integrity in your products and services.
5. Integrate digital chatter vigilance into your internal/ex-

ternal communications strategy as well as enterprise risk
management.
MEGATREND #4—STAKEHOLDER
CAPITALISM AND ESG INTERTWINING

IN 2021-2022 FROM… …TO IN 2022-2023

Stakeholder Capitalism Rising (#5) Stakeholder Capitalism and ESG
Intertwining (#4)
“Stakeholder Capitalism and ESG Intertwining” zeroes in on a general
trend and some nuances. The general trend is that terms like stake-
holder capitalism and ESG continue to be thrown around and debat-
ed increasingly because of the deeply transformational moment tra-
ditional shareholder centric capitalism is undergoing. This ongoing
socio-economic transformation, in turn, is a reflection of, and reac-
tion to, the convergence of several deep global, even existential, risks
(mostly environmental and social) that also afford broad opportunity
(clean-tech, health, social justice). The nuances come from both mis-
understandings and disagreements about what each of these terms
really means, as well as how these concepts intertwine, converge, or
conflate.
The bottom line, however, is that there is pervasive change in how

socioeconomics are unfolding and how the shareholder-centric
capitalism of the past half century is giving way to a broader-based
concept of capitalism that includes a broader set of stakeholder con-
siderations, expectations, and interests—whether in the business,
social, or government sectors—where employees, customers, regula-
tors, suppliers, and others are playing a more important role.
This megatrend is broadly categorized under the “Society” category of

ESGT because it is above all about how society deals with socio-eco-
nomic risk and opportunity. One can view it as a glass half empty—a
set of risks and dangers—or as a glass half full—a series of opportuni-
ties for impact, growth, and value creation. I choose the latter.
The Danger and the Risk of Stakeholder

Capitalism and ESG Intertwining
As a refresher, Figure 31 shows several forms of capitalism extant to-
day, which were discussed in greater detail in the 2021-2022 edition
of the ESGT Megatrends Manual.

Figure 31
Types of Capitalism
What we mean by “intertwining” is that each of the “Stakeholder Cap-

italism” and “ESG” concepts is misunderstood in and of itself and both
concepts are becoming interrelated and often conflated. So, on the
one hand, each concept can mean different things to different people.
On the other hand, both concepts are inextricably interconnected be-
cause of their general thrust as part of the transformational socioec-
onomic moment we are living through—a moment that seems to be
moving us from a Milton Friedman-dominated notion of “Sharehold-
er Capitalism” to a broader concept of capitalism that we are loosely
calling “Stakeholder Capitalism.” In addition, ESG is roaring into the
scene of late as well—impelled mostly by the investor, asset manage-
ment, and nonprofit sectors even though it has a much longer history
around sustainable, ethical, and environmentally friendly investing.
See Figure 32 for a sense of the sweep of the historical antecedents.
Figure 32
A Sweeping Historical View of the Evolution of ESG
So, what are the risks and pitfalls of this convergence, interconnected-
ness, and conflation? There are several nuances to this transformational
moment that can be considered problematic, though addressing and
resolving these issues and risks can create vast opportunity as we dis-
cuss in the next section. But first, let’s examine some of the problems.
Too Many ESG Issues and Stakeholders,

Too Little Time
One of the complaints one hears from more traditional, sharehold-
er-centric, financially focused businesses is that focusing on too many
stakeholders dilutes the focus on the fiduciary duty of maximizing re-
turns and profits to the owners. The counter to that is that we are liv-
ing in a world that is different from decades ago where environmental
and social issues (as well as technological ones) have become strategic,
global, inevitable, and potentially existential and ignoring those issues
and their primary stakeholders undercuts value preservation, protec-
tion, and enhancement. These issues and these stakeholders aren’t go-
ing away so better to tap into their perspectives than not. Many share-
holders and their advisors and representatives are acknowledging the
importance of these ESG issues (that in turn relate to multiple stake-
holders) as illustrated in Figures 33, 34, and 35.
Figure 33
Shareholder Resolution
Proposals In the U.S.
by Topic and Outcome
2013-2022
Source: The Economist April 2022

Figure 34
U.S. Shareholder Resolutions on Environmental
and Social Proposals 2013-2022
Source: The Economist April 2022
Figure 35
Corporate Governance Exceeded Half of All
Shareholder Activist Campaigns in 2020
Source: S&P Global 2021
The ESG Tower of Babel

One of the concerning areas is the absolute avalanche or tsunami
of information—useful and non-useful information. The adage “gar-
bage in/garbage out” can very well apply to this data tsunami gener-
ated by myriad sources—both established and new, reliable, and not.
Part of the problem is the lack of nomenclature clarity and the fact
that we are in a wild west period for ESG that will eventually yield
common words, categories, data sources, etc. But in the meantime—
during this period of competition to see who survives—we are bound
to continue to struggle with data, concepts, nomenclature, and the
ability to compare apples to apples.
Finally, until the various frameworks for reporting in ESG metrics and
results begin to speak to each other and the accounting firms under-
stand how to measure ESG matters for accounting and assurance pur-
poses, we will continue to have this challenge of the ESG Tower of Babel.
Figure 36 makes this point louder than words.
Figure 36
The ESG Ecosystem In 2021
ESG Regulatory Creep

The EU has been ahead of the rest of the world when it comes to pro-
viding guidance on what they expect from larger companies within
their jurisdiction on ESG disclosure. The regulatory stance in the Unit-
ed States has been a lot more confusing, especially under the previ-
ous administration where a lot of push-back on environmental and

ESG issues took place (now being reversed by the Biden Administra-
tion). For example, Chairman Gary Gensler of the U.S. Securities and
Exchange Commission has introduced a vast and deep sweep of pro-
posed regulatory changes affecting many ESGT issues from environ-
ment to cyber, which includes most notably a major 550-page propos-
al on climate disclosure which is likely to be finalized and implemented
later in 2022. Table 11 provides an overview of the key points in the U.S.
SEC’s climate proposal published in the Spring of 2022.
TABLE 11
U.S. Securities and Exchange Commission Fact Sheet:
Enhancement and Standardization of Climate Related
Disclosure 2022
• Climate-related risks and their actual or likely material impacts on business,
strategy, and outlook.
• Details about governance practices on climate-related risks and relevant risk

management processes.
• Scope 1 and Scope 2 greenhouse gas emissions, which would require attesta-
tion reports for accelerated filers.
• Scope 3 emissions reports if either of two conditions are present: 1) if Scope 3

emissions are material to the company or 2) if the company has set emissions
target or goal that includes Scope 3 emissions.
• Certain climate related financial statement metrics and related disclosures in a

note to audited financial statements.
• Information about climate-related targets and goals, and transition plan, if any.
Source: U.S. Securities and Exchange Commission Fact Sheet:

Enhancement and Standardization of Climate Related Disclosure 2022
Greenwashing/ESG Washing?
Given the concept and nomenclature confusion and the absence of
clear and effective regulation mentioned above, one of the biggest
challenges of these times is figuring out which companies are green-
washing or what I like to call ESG-washing (if they are obfuscating or
lying on more than environmental results) and which funds or invest-
ment vehicles are doing the same in terms of not having a rigorous
and high integrity approach to choosing companies for their funds.
Thus, something that is a rising reality is the expansion of litigation,
shareholder derivative lawsuits, and shareholder proxy strategies.
Indeed, greenwashing disputes, litigation, and other regulatory ac-

tion is probably about to explode. If we take a look at this story from
Fast Company, it’s only a matter of time as the technological tools to
unearth greenwashing are also working in overdrive:
Source: Fast Company July 20, 2021.
Business Walks a Political Tightrope

In all this, business—management and the board—is left in the unen-
viable position to chart its own stakeholder capitalism/ESG strategy.
On top of everything listed above and in previous megatrends (climate
crisis, Ukraine War, and supply chain challenges), businesses, espe-
cially in the United States but in other advanced democracies as well,
are subject to the vicissitudes of political polarization, socio-econom-
ic tensions, pandemic fallout, and other stresses to their sociopolitical
systems that are creeping more deeply every day into the workplace.
Indeed internal (employees) and external (customers) stakeholders
are demanding that companies take a political stance. What to do?
The Ukraine war is helping to push this along in two major ways by
1) creating solid lines over which a “good ESG” company won’t cross
(doing business in or with Russia) and 2) exposing the global energy
co-dependencies and fault lines that have made EU democracies de-
pendent on or beholden to kleptocratic oil states like Russia.

Table 12 shows an array of ESGT issues, risks and opportunities that
companies located in or doing business with Russia and Ukraine
must consider.
Table 12
Sampling of Potential ESG/ESGT Issues, Risks, Opportunities
of Companies Located or Doing Business in Russia and Ukraine
Environment Society Governance Technology
• Destruction • Health, safety, • Reputation • Internet ac-
of habitats, wellbeing of risk manage- cess/usage
cities, plants, employees, ment • Social media
infrastruc- contractors, • Resilience • Digital chatter
ture, facilities, partners, their building • Cyber-security
offices families • CEO public • Data privacy
• Pollution from • Human rights comments/ • Data back up
destruction • Political support for • Damage or
– water, air, speech democracy destruction of
earth • Labor rights • Sanctions un- technology
• Destruction • Migration derstanding & • Hardware
of agriculture, issues compliance maintenance
food supplies • Discrimination • Review of • Device main-
• Vicinity of • Harassment investments, tenance
nuclear plants, • Bullying partnerships & • IoT
potential • Social media joint ventures • Drones
ecological use • Review of
disaster supply chain
• Biodiversity contracts
loss • Review of
sales contracts
Source: GEC Risk Advisory 2022
The Promise and the Opportunity of Stake-

holder Capitalism and ESG Intertwining
Workers Are the Most Important Stake-
holders—Focusing on Them Adds Value
After shareholders, the most important stakeholder for business is
workers. Especially as we emerge from the worst of the pandemic,
employees sit in the catbird seat—call it the Great Resignation, or
the Great Reset, or the Future of Work. Whatever you call it, workers
have—at least temporarily—some power, and they are armed with
ESG and other issues that will drive them into your more reputable
competitor’s arms if you don’t achieve good ratings amongst peers
or literally rate well as in a Glassdoor company profile, for example.
The surveys referenced in Figures 37 and 38 make these points clear.
Figure 37
Source: Oxford Globescan 2021.
Just Capital’s top 8 issues of the 19 they measure are dominated by

“worker” stakeholder issues (numbers 1, 4, 6 and 7 below):
Figure 38
Top Stakeholder Issues For 2021

Indeed, workers—especially the younger generations—are no longer as
loyal to their employers as they used to be and are tying much of their
mobility to whether their employers take sustainability, ESG issues,
and corporate responsibility seriously. See Figure 39.
Figure 39
Employee Job Change
and Sustainability
Source: IBM Institute for Business Value 2022.
The bottom line is that each company needs to figure out who their
key, most critically important stakeholders are and, in the process,
prioritize their issues and expectations. Figure 40 shows the top is-
sues for each of the five stakeholder groups that Just Capital analyzes
and Figure 41 shows the power of the customer stakeholder cohort.
Figure 42 shows a number of concrete, bottom line ESG benefits and
advantages that Just Capital found from its in depth analysis of lead-
ing companies.
Figure 40
Stakeholder Priority Issues
2021 by Stakeholder

Figure 41
Consumers and Sustainable Products
Source: IBM Institute for Business Value 2022.
Figure 42
The Just Capital Just 100 Companies
Bottom Line Advantages

ESG Nomenclature and Metrics
Convergence
Even though we are still in the wild west phase of ESG frameworks,
reporting and metrics, there is hope on the horizon for a convergence
of quantitative and qualitative standards, principles both in the dis-
closure process as well as in the accounting/assurance methodology
that will eventually be used. Figure 43 speaks to this important trend.
Figure 43
Convergence of Sustainability Reporting Frameworks
Businesses that “Get It” Get More Value,

Sustainability, and Resilience
Studies show that businesses that get that we’re undergoing a major
socioeconomic transformation from what was shareholder centric to
something more broadly inclusive of stakeholders and their issues,
risks, and opportunities, are not only protecting the downside but
turbocharging the upside of value protection and preservation (see
Figure 44) and value creation (Figure 45).
Figure 44
Companies with Strong ESG Performance are More Resilient
Source: Edelman.
Figure 45
ESG Focus Provides Positive Returns
Source: McKinsey 2020.
And, finally, very hopeful results came from in a recent study that
sought to understand whether implementing a multi-stakeholder
strategy leads to better returns. The explanation of the study and its
top-level results are contained in Figure 46.

Figure 46
Stakeholder “Talk” Equates with Stakeholder “Walk”
Source: Report: Walking the Talk: Valuing a Multi-Stakeholder Strategy.

FCLT and Wharton. 2022.
A Leadership Battle Plan to Deal With Stake-


1. Where does the entity fit in the spectrum of Milton
Stakeholder Capitalism Friedman shareholder capitalism to stakeholder capi-
and ESG Intertwining talism?
2. Do you have an interdisciplinary team of ESG/ESGT

experts working together at various levels of the organi-
zation to create order from the ESG chaos?
3. Do you understand who your most important stake-

holders are and their expectations?
4. What is the state of your ESG or ESGT strategy, risk

management and governance? Engage in a self-evalua-
tion (SASB) regardless of whether you are private, public,
nonprofit, governmental to find out.
5. Develop a long-term strategy with practical milestones,

metrics, resources and budgeting and stick to it.
MEGATREND #5—LEADERSHIP AND
INSTITUTIONAL TRUST RECALIBRATING

IN 2021-2022 FROM… …TO IN 2022-2023

Leadership and Institutional Trust Leadership and Institutional Trust
Plummeting (#2) Recalibrating (#5)
This year’s megatrend “Leadership and Institutional Trust Recalibrat-

ing” (ranked #5) feeds off of last year’s similar megatrend “Leadership
and Institutional Trust Plummeting” (ranked #2), with some interest-
ing differences.
The trendline in leadership and institutional trust continues to be rel-
atively negative and even alarming but there are several green shoots
of what might be considered a recalibration, or at least a temporary
equilibrium taking place in both the business and political leadership
and institutional spheres. Key themes in this discussion include the
role of corruption, competency, and ethics in calibrating the ESGT
leadership of people and institutions (business, government, media,
and nonprofits).
This megatrend is squarely about governance as it is all about how

leaders lead and how well institutions are structured to provide the
necessary “governors” or governance for good strategy, effective risk
management and healthy ethics and culture—or not.
The Danger and the Risk of Leadership

and Institutional Trust Recalibrating
Trust
While leadership and institutional trust has been steadily declining
over the past decade according to the Edelman Trust Barometer, over
the past two years we have seen something interesting: a recalibra-
tion of trust in the business community—whether deserved or not.
See Figure 47.
Figure 47
Edelman Trust Barometer 2022: Business Most Trusted

It’s not clear if this has something to do with business taking on more re-
sponsibility for the global commons, seeing greater potential for profits
through purpose or because others—like governments—have dropped
the baton on social, socioeconomic, and political responsibility.
A glimpse at political trust in the United States as illustrated in Table

13 shows that trust in the United States clearly continues on a decline,
despite (or maybe because of) the change in administration in the
U.S. from President Trump to President Biden. The tenor of political
and ideological polarization in the U.S. has not been this extreme in
generations.
Table 13
Pew Research Center – Key Findings About Americans
Declining Trust in Government and Each Other
April 2022
1. Americans think the public’s trust has been declining in both the federal
government and in their fellow citizens.
2. Nearly two-thirds (64%) say that low trust in the federal government makes it
harder to solve many of the country’s problems.
3. Most think the decline in trust can be turned around.
4. Nonwhites, poorer and less-educated individuals, and younger adults have lower
levels of personal trust than other Americans.
5. Levels of personal trust tend to be linked with people’s broader views on
institutions and civic life.
6. Majorities believe the federal government and news media withhold
important and useful information.
7. Democrats and Republicans think differently about trust, but both groups wish
there would be more of it.
8. On a scale of national issues, trust-related issues are not near the top of the “very
big” problems Americans see. But people often link distrust to the major problems
that worry them.
Source: Pew Research Center. 2022.
Trust, Ethicality, and Competency

Whatever the reasons, business leaders are leading more effectively
than any other category of leader, according to the Edelman Trust
Barometers from 2020 through 2022, at least in terms of competency
and ethics. See Figures 48 and 49.
In Figure 48 showing the difference between 2020 to 2021, Edelman

compares the overall results of competency and ethicality (on an x/y
axis) for the four institutions they examine—business, NGOs, media,
and government—reflecting the results of the global stakeholder sur-
veys they conduct each year.
Looking at the difference between 2020 and 2021 one can observe
the following:
• Business moves from being considered slightly unethical to

slightly ethical while remaining somewhat competent.
• NGOs, while considered generally ethical, are considered slightly

incompetent.
• Media and government are considered both less competent and

less ethical with government being in the worst shape.
Figure 48
Business is Both Competent and Ethical
However, if we move to the comparison between 2021 and 2022 there

are some interesting improvements where:
• Business moves up substantially on ethicality.
• NGOs move substantially forward into the ethical/competent

quadrant, scoring especially high on ethicality.
• Media generally remains in a similar negative (unethical, incom-

petent) quadrant.
• Government is in the worst shape, continuing a steady decline in

both competency and ethicality.

Figure 49
Business & NGOs Most Stabilizing Institutions
Trust, Transparency, and Democracy

Much of the leadership and institutional trust discussion must be
framed in the context of the debate on transparency, corruption, de-
mocracy, and autocracy. The Transparency International Annual Cor-
ruption Perception Index (TI CPI) for 2021 provides some big picture
takeaways. Each year it scores around 180 countries and territories by
“their perceived levels of public sector corruption, according to ex-
perts and businesspeople.” It uses a scale of 0 to 100 where 100 is “very
clean” and 0 is “highly corrupt.” In 2021, 2/3 of the 180 countries scored
below 50 and the average score was a 43. Both measures were quite
disappointing. See Figure 50.
As usual, there are a few dominant Nordic countries that make up the
top 10 of least corrupt countries. These same countries often show up
on lists of the happiest countries, the most democratic countries, and
the most egalitarian countries. Sadly, as we look at the bottom ten or
most corrupt countries on the TI CPI for 2022, they are mostly coun-
tries that are suffering through serious and lengthy civil unrest or war.
See Figure 51.
Figure 50
2021 Corruption Perceptions Index Report
Source: Transparency International. Corruptions Perception Index Report 2022.
Figure 51
2021 Corruption Perceptions Index Report:
Top 10 and Bottom 10 Countries
Source: Transparency International Corruption Perception Index 2022
Interestingly, the “perception” of corruption doesn’t always coincide

with the reality of corruption or the reality of a systemic, pervasive
form of what I refer to as “systemic legalized corruption” evident in
advanced market democracies where the economic and political
system are organized in such a way that the corrupt aspects of it be-
come buried in everyday life.
For example, while the United States ranks 27th in TI’s 2021 CPI (falling
from 23 in 2019 and 25 in 2020) and the United Kingdom has ranked
in the 11th and 12th position in each of these years, how do we explain
why both countries are a magnet for criminal money laundering,
shell companies, and opaque investments by the world’s criminals
like the Russian oligarchs that are in the current eye of the Russia/
Ukraine storm?
Both the U.S. and the UK are amongst the most established democ-
racies and market systems in the world, have highly developed legal,
accounting, lobbying, tax, and corporate opacity that allow interna-
tional criminals and others to hide behind dummy entities.
The Russia/Ukraine conflict has helped to put in stark relief this para-
dox. What this conflict has also cast great clarity on is how open dem-
ocratic systems have been complacent about corruption, allowing
themselves to become more corrupt than before, through the allure
of wealth, riches, and power and in the process weaker from a rule
of law and democratic rights standpoint. Throw misinformation and
disinformation warfare into the mix and we have some root causes
for the decline of democracy worldwide (discussed under Megatrend
#1 - Geopolitical Tectonic Shifts Catalyzing).
The Ukraine/Russia conflict has made another thing extraordinari-

ly clear: the difference between democracy and autocracy and the
difference between a responsible/enlightened leader and an irre-
sponsible/corrupt and criminal leader. Using the typology of ESGT
leadership I developed years ago and explained in great detail in my
book Gloom to Boom, here is what I would say about current political
leadership in the context of the new global conflict and on wheth-
er a leader is walking the ESGT talk (the Enlightened or Responsible
Leader); merely paying lip service to ESGT (the Superficial Leader); or
completely oblivious to, or negligent or criminal toward, ESGT issues
(the Irresponsible Leader). Table 14 provides a summary overview of
such leaders with examples and explanations.
Table 14
A Geopolitical Typology of ESGT Leadership
Based on “Gloom To Boom” Book Typology
Type of Leader Example(S) Why
Enlightened Geopolitical/ President Zelenskyy, • Sets an inspiring
Political Leaders Ukraine leadership tone
Prime Minister Ardern, • Focused on trans-
New Zealand forming ESGT risk
President Tsai Ing-Wen, into value
Taiwan • Innovates, thinks
outside the box
• Shows deep responsi-
bility to stakeholders
• Devotes personal
time, effort to lead
change, lead teams,
motivate nation
Responsible Geopolitical/ President Biden, US • Sets a positive leader-
Political Leaders Prime Minister Marin, ship tone
Finland • Understands key
Prime Minister ESGT issues, risks,
Andersson, Sweden and opportunities
Secretary General • Can be innovative
Stoltenberg, NATO • Shows responsibility
to stakeholders
• Devotes personal
time, effort to lead
change
Superficial Geopolitical/ Prime Minister Johnson, • Does not set an inclu-
Political Leaders UK sive leadership tone
Prime Minister Orban, • Cares only about
Hungary ESGT issues that
Prime Minister Modi, India further own power,
influence, longevity,
or reach
• Cares only about
stakeholders that
support him/her
Irresponsible Geopolitical/ President Xi, China • Sets an exclusive,
Political Leaders President Putin, Russia partisan, autocratic
Crown Prince Mohammad leadership tone
Bin Salman, Saudi Arabia • ESGT issues are most-
ly not on the radar
• May engage in klep-
tocratic corruption to
advance own power
and wealth
• Abuses human rights,
conducts domestic or
international violence
to maintain power

The Promise and the Opportunity of Lead-
ership and Institutional Trust Recalibrating
Perhaps one of the lessons learned from the ranking of most “Just Com-
panies” according to their stakeholders is that leadership and institu-
tional trust is possible, but it requires deliberate, conscientious action,
tone from the top, not just in words but in deeds. That is the thinking
behind my typology of ESGT leadership shown in Figure 52 below and
discussed in depth in Chapter two of my book, Gloom to Boom.
In this typology, I gauge a leader’s commitment (or lack thereof) to

the ESGT issues, risks and opportunities that are most relevant to
that leader’s institution—whether it’s a business or some other entity.
The range of leadership styles goes from the worst—the Irresponsible
Leader who ignores or is hostile to such issues, risks, and opportuni-
ties; to the mediocre and manipulative—the Superficial Leader who
uses ESGT issues, risks, and opportunities as a marketing or green-
washing ploy; to the Responsible and Enlightened Leaders, whose
only difference is that in the case of the enlightened they not only
walk the talk and provide substantive support in budget and resourc-
es on all things ESGT, but they also integrate ESGT into product and
service development, innovation, and the overall culture of the insti-
tution. Figures 52 and 53 show examples of leaders that fit these cat-
egories in politics and business.
Figure 52
ESGT Leadership Typology Applied to
Government Leaders in 2022
Figure 53
ESGT Leadership Typology Applied to Business Leaders in 2022
More than anything else this year, the extraordinary leadership ex-
ample that President Volodomyr Zelenskyy of Ukraine has shown in
dire times is serving both as a wake-up call and shining example of
what responsible, trustworthy, ethical leadership looks like, especial-
ly in contrast to the other extreme represented by the sociopathic,
non-leadership of President Putin of Russia. And this applies not only
to political leaders but also to any kind of leader (management or
board) in business, nonprofits, universities, etc.
At the crux of good leadership and effective institutions is trust by

stakeholders in leaders and institutions. Also, at the crux of this mat-
ter is the idea of transparency—the opposite of corruption. Leaders
and institutions that are considered untrustworthy are often such
because of some form of actual or perceived corruption as well.
But what is trust? Trust is at the core of a successful and enduring

culture. Trust is created, modeled, and earned every day by the lead-
ership team, especially the CEO/Executive Director/President. Trust
is the glue that keeps the organization and its internal and exter-
nal stakeholders focused, motivated, and productive. Enduring trust
only happens when an organization’s leadership lives and breathes
trust daily by encouraging a robust speak-up, listen-up, and follow-up
culture that empowers stakeholders—especially staff—to speak up
without fear of retaliation, and where leadership listens and imple-
ments responsive continuous improvement.
Transparency International has a few recommendations for the trian-

gulation of the multifaceted problem that is corruption. In their 2021

TI CPI they highlight the four illustrated in Figure 54.
Figure 54
Transparency International 2021 Report Anti-Corruption
Recommendations
But the issue of leadership and institutional trust recalibrating and

the possible silver lining of business becoming a more trusted insti-
tution globally seems to have some validity. In his exceptional 2021
book “Corruptible,” Brian Klaas puts his finger on the pulse of why
we have poor leadership, and by implication institutions, and it gets
back to something I have been analyzing, living through, and writing
about throughout my career as well: why do we seem to have more
sociopathic, hubristic, and corrupt people on average in positions of
power than in the general population?
To oversimplify what Klaas says: it boils down to one of two things:
• The corrupt tend to seek power and the non-corrupt are not as
interested in entering the fray.
• The non-corrupt become corrupted as the gain power.
Either way, this is a problem. Klaas concludes his very well researched
book offering 10 lessons. They are listed in Table 15.
Table 15
The Ten Lessons of
Brian Klaas’ Corruptible: Who Gets Power and How it Changes Us
(Scribner 2021)
1. Actively recruit incorruptible people and screen out corruptible ones
2. Use sortition and shadow governance for oversight
3. Rotate to reduce abuse
4. Audit decision-making processes not just results
5. Create frequent, potent reminders of responsibility
6. Don’t let those in power see people as abstractions
7. Watched people are nice people
8. Focus oversight on the controllers not the controlled
9. Exploit randomness to maximize deterrence while minimizing invasions of privacy
10. Stop waiting for principled saviors, make them instead
Source: Brian Klaas. Corruptible: Who Gets Power and How it Changes Us. Scribner 2021.
I will close with an offering of my own from Gloom to Boom. What I
call the Resilient Leadership Manifesto—something most of us need
these turbulent days. See Figure 55.
Figure 55
The Resilient Leadership Manifesto

A Leadership Battle Plan to Deal
with Leadership and Institutional
Trust Recalibrating
AN ESGT LEADERSHIP BLUEPRINT FOR 2022-2023

1. How is your leadership at various levels (from the
Leadership and very top to junior management) selected? Are there
Institutional Trust behavioral and other psychological tests and profiles,
Recalibrating especially for the most powerful positions?
2. Tie leadership traits that go beyond the core finan-

cial, operational and leadership characteristics you
have typically used to reward staff and leadership to
include qualities associated with non-toxic cultures.
3. Understand the culture of your organization by do-

ing an independent culture assessment and surveys to
determine the gaps.
4. Integrate findings from the culture assessment into

governance, strategy, and compensation structures.
5. Whatever you do, do not reward toxic leaders—

indeed, get rid of them as soon as possible.
3. THE 2022-2023
LEADERSHIP ESGT
BLUEPRINT

1. Leadership teams (management and boards) must have
Geopolitical access to real time international geopolitical, national, and
Tectonic Shifts local political data and advice relating to their strategic
Catalyzing footprint, geography, supply chain, and planning.
2. A designated member of management should oversee

geopolitical and political developments with the assistance
of solid intelligence and advisors reporting to c-suite and
board periodically and coordinating in real time with risk
management.
3. Add geopolitical risk and opportunity considerations to

the yearly budgeting and strategy planning exercises.
4. Understand how international and national politics affect

your business/entity through the eyes of your stakeholders.
Understand the reputation risk and opportunity embedded
in such views and add them to corporate/entity internal
and external messaging and communications.
5. Make sure all political content messaging is 100% aligned

with your organization’s purported mission, vision, values,
and purpose.


1. Does the organization have an Enterprise Risk Manage-
Climate and War ment framework? Make sure climate, geopolitical and
Propelling societal risks are part of the considerations.
Complex Risk

Continued
2. What’s the state of your risk governance and over-
Climate and War sight?
Propelling
Complex Risk • Is the board of directors risk-savvy and experi-
enced?
• Is there a risk oversight committee?
3. Does the company have a savvy Chief Risk Officer

and team? Do the team members have the resources
and tools necessary for foresight and futureproofing?
4. Is there a crisis management plan and team, includ-

ing a board liaison or member? Is scenario planning
integrated into such plans and periodically conducted?
5. Is there organizational resilience management and

oversight, business continuity, and data protection?
What’s the state of your organizational resilience?
A Leadership Battle Plan to Deal with Tech


1. Figure out what tech dimensions are relevant to your
Tech Disruption footprint and pursue the necessary governance, risk man-
Becoming agement and ethical boundaries around it.
Multidimensional
2. Undertake a technology stakeholder analysis relevant to
your business footprint to understand what your stake-
holders’ tech expectations are.
3. Ensure cyber-hygiene. What is the state of cyber-security

risk management at your organization? Is it effective?
4. Ensure that your organization is vigilant about informa-

tion and data integrity in your products and services.
5. Integrate digital chatter vigilance into your internal/ex-

ternal communications strategy as well as enterprise risk
management.
A Leadership Battle Plan to Deal With Stake-

1. Where does the entity fit in the spectrum of Milton
Stakeholder Capitalism Friedman shareholder capitalism to stakeholder
and ESG Intertwining capitalism?
2. Do you have an interdisciplinary team of ESG/ESGT

experts working together at various levels of the or-
ganization to create order from the ESG chaos?
3. Do you understand who your most important

stakeholders are and their expectations?
4. What is the state of your ESG or ESGT strategy, risk

management and governance? Engage in a self-eval-
uation (SASB) regardless of whether you are private,
public, nonprofit, governmental to find out.
5. Develop a long-term strategy with practical mile-

stones, metrics, resources and budgeting and stick to it.
A Leadership Battle Plan to Deal with

Leadership and Institutional Trust
Recalibrating
1. How is your leadership at various levels (from the
Leadership and very top to junior management) selected? Are there
Institutional Trust behavioral and other psychological tests and profiles,
Recalibrating especially for the most powerful positions?
2. Tie leadership traits that go beyond the core finan-

cial, operational and leadership characteristics you
have typically used to reward staff and leadership to
include qualities associated with non-toxic cultures.
3. Understand the culture of your organization by do-

ing an independent culture assessment and surveys to
determine the gaps.
4. Integrate findings from the culture assessment into

governance, strategy, and compensation structures.
5. Whatever you do, do not reward toxic leaders—

indeed, get rid of them as soon as possible.

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Copyright © by Diplomatic Courier/Medauras Global Publishing and GEC Risk Advisory 2022.

COVER DESIGN. Cover and jacket design by Marc Garfield.

2 | ESGT MEGATRENDS MANUAL

GEC RISK ADVISORY

4 | ESGT MEGATRENDS MANUAL

06 The Year Systemic Situational Awareness Became

09 What’s New? The Five Megatrends of 2022-2023

12 Revisiting Key Concepts and Definitions

2. The Five ESGT Megatrends for 2022-2023

3. The 2022-2023 Leadership ESGT Blueprint

92 A Leadership Battle Plan to Deal With

92-93 A Leadership Battle Plan to Deal With

93 A Leadership Battle Plan to Deal with Tech

94 A Leadership Battle Plan to Deal With

Russia invades Ukraine 2022 G, S, T

6 | ESGT MEGATRENDS MANUAL

Why is this year’s Megatrends Manual’s subtitle “The Year Systemic

Figure 2 helps to make my point—we are used to looking at world

Figure 2 - North Pole Map Showing Agriculture

Source: The Economist.

Each year, the ESGT Megatrends Manual examines a handful of ESGT

8 | ESGT MEGATRENDS MANUAL

The ESGT Megatrends Manual is intended to be a practical handbook

What’s New? The Five Megatrends

We live in tectonic times. We live in systemic times. We live at a

The above comments apply to this coming year—with a vengeance.

Tables 2 and 3 provide, respectively the new ESGT Megatrends for

• Table 4 compares the two years’ reprioritization of the megatrends

• Table 5 shows how each megatrend evolved from a nomencla-

The reprioritization and recalibration of each megatrend underscore

10 | ESGT MEGATRENDS MANUAL

Table 6 - ESGT Megatrends Compared 2021/22 to 2022/23

How Is the Approach to Each

What Is, and Why “ESGT”?

To level set, here’s a simple definition of ESG from an ESG investment

12 | ESGT MEGATRENDS MANUAL

“So, why add ‘technology’—another layer of issues, risks, and

What Are “Megatrends”?

I found out that, despite everything, in the midst of winter,

And that makes me happy.

there’s something stronger—something better, pushing right back.”

-Albert Camus. The Invincible Summer. 1953.

I dedicate this year’s edition of The ESGT Megatrends Manual to the

14 | ESGT MEGATRENDS MANUAL

Source: A. Bonime-Blanc, Gloom to Boom. Routledge 2020.

16 | ESGT MEGATRENDS MANUAL

IN 2021-2022 FROM… …TO IN 2022-2023

“Freedom must be armed.” -Volodymyr Zelenskyy, April 2022.

This quote from new global democracy hero, Volodymyr Zelenskyy,

Putin’s aggressive and unprovoked attack on Ukraine of February 24,

This megatrend belongs squarely in the category of “Governance”

Source: Council on Foreign Relations. Preventive Priorities Survey 2022.

18 | ESGT MEGATRENDS MANUAL

• The growing democracy gap—16 years of democratic decline

• Fewer people living in “free democracies” over the past 16 years

• Visualized in map form between closed and electoral autocracies

Source: Freedom House Freedom in the World 2022.

Source: Freedom House Freedom in the World 2022.

Source: OurWorldInData.org/Democracy 2022.