The Annual Meeting in Davos-Klosters remains the foremost creative force for engaging the world's top leaders in collaborative activities to shape the global, regional and industry agendas.
Each year, business, political and academic leaders convene for the World Economic Forum, where they work together to improve the state of the world and address the most pressing issues of our day.
From our partners' views and active participation on the floor at Davos to the formal reports led by Bain industry governors, Bain & Company's thought leadership is prominent throughout the Forum each year. At the 2016 meeting, Bain Chairman Orit Gadiesh will lead a discussion on the Transformation of Health with a panel of senior executives in the health arena.
Industry Governors: The Future of Healthy project is the premier global platform to enable critical dialogues among public and private stakeholders and to facilitate collaborative action to tackle the growing pandemic of non-communicable diseases (NCDs). The cumulative direct and indirect cost of NCDs over the next 15 years are around five times the costs caused by the global financial crisis in the 15 years following 2008. Addressing the complex and multi-causal origins of the man-made NCD pandemic requires a system-level approach in which stakeholders collaborate across sectors and industries.
Norbert Hueltenschmidt, a Bain partner in Zurich and the former leader of Bain's Global Healthcare practice, led Bain's involvement in the two-year "Future of Healthy" project. After demonstrating in "Maximizing Healthy Life Years" that health can have a positive return on investment, the 2016 report, "How to Realize Returns on Health", shows how to tackle the silent NCD pandemic, including why we should focus on Maximizing Healthy Life Years (MHLY) instead of just treating disease, why we need to act boldly now and how investments in health can have healthy returns in a multi-stakeholder environment by creating Ecosystems of Health.
In times of economic uncertainty and slow growth, it is more important than ever for economies to find alternative ways to gain a competitive advantage. NCDs are a key threat to a population's health and therefore its economic prosperity. At the same time, the unsustainable scale of the problem is demanding bold action — thereby creating new opportunities for companies to shape, design or disrupt, either internally or through partnerships. Investments in the primary prevention of NCDs, built on robust population health information and efforts to Maximize Healthy Life Years across individuals' life spans, will yield positive returns both on health as well as on investment.
The "How to Realize Returns on Health" report shows:
- How investments in health can have healthy returns
- How Ecosystems of Health align private and public stakeholders across sectors and industries
- How the individual must be put at the center to make these ecosystems happen
- How Ecosystems of Health create the foundation for market-driven solutions to tackle NCDs and to Maximize Healthy Life Years
- Important success factors for healthier lives
Enabling Trade project found that improving border administration processes and transport infrastructure could increase global GDP up to six times more than removing all remaining import tariffs. Taking domestic action to reduce the time and cost required to move goods allows consumers to benefit from reduced prices, while also making exported goods more competitive. In this context, the 2013 WTO Trade Facilitation Agreement reached in Bali was a big step toward reducing supply chain barriers and reinvigorating global trade. We observed that while accomplishing the goals of the Trade Facilitation Agreement will be generally helpful, it is possible to be completely compliant and yet not improve the competiveness of any industry within a given country. To truly achieve the benefits of trade facilitation, countries need to focus on the economics of the supply chains of specific industries.
This year, we analyzed Mexico's economy and went deep in assessing the benefits of reducing the supply chain barrier for one of its key industries, medical devices. By looking at the end-to-end value chain of the medical devices journey across the value chain, we were able to establish the key barrier to full potential trade and determine that, by reducing them, Mexico's medical devices industry would become up to nearly 10% more competitive in the global stage. This improvement could translate in an exporting volumes increase of up to 25% from today's levels.
Industry Governors: Future of Electricity
Bain's second annual report on the Future of Electricity turns from developed markets to the issues faced by fast-growing economies as they ramp up their power sectors to meet rising demand for electricity. As with the first report, Julian Critchlow, global head of Bain's Utilities & Alternate Energy Practice, leads the effort, joined this year by Amit Sinha, a Bain partner who works with the Utilities practice in India as well as Rodrigo Rubio and Juan Carlos Gay, who work with the practice in Mexico.
The 2016 report, "The Future of Electricity in Fast-Growing Economies: Attracting Investment to Provide Affordable, Accessible and Sustainable Power" describes how fast-growing markets will need to double their investments in electricity to meet energy policy objectives. At the same time, the nature of competition is shifting from importing fossil fuel resources to importing the capital necessary to invest in renewables and energy efficiency. Fast-growing economies are turning to international and domestic investors to fund the growth. However, most of these countries have a mixed record of attracting private investors, who are often wary of volatile or lackluster returns and opaque policies and regulations.
The report identifies eight best practices to help make the electricity sectors of fast-growing economies more attractive to investors, including:
- Developing integrated policies that ensure parallel development across the power value chain.
- Removing financial obstacles from all parts of the value chain to ensure the viability of operations in power sector
- Creating effective public-private partnerships to attract private sector capital