We are all wondering: what’s next? This paper poses and answers 10 questions.
This post is available as a PDF to download and cite on ResearchGate and SSRN.
These are predictions for the COVID-19 era and beyond based on my research.[1]
Question One: will the novel coronavirus / COVID19 accelerate automation?
Answer: yes. Automation has already evolved beyond manufacturing to other business processes. This trend is likely to accelerate as a result of the pandemic. Some of the under-appreciated potential of blockchain — or distributed ledger technology — relates to maintaining credible records, certification, and self-executing smart contracts. We are now acutely aware of how quality certification in a supply chain can be a vital matter of life-or-death. We worry about the viability of supply chains that rely on people who can get sick. So it seems a reasonable to expect to see more blockchain-enabled automation in supply chains, with several implications explored in my recent article in Blockchain, Business Supply Chains, Sustainability, and Law: The Future of Governance, Legal Frameworks, and Lawyers?[2]
However, the pandemic has also highlighted the pitfalls of automation described in the article. Among them, there will be a greater need to (1) proactively ponder contingencies and consequences (as I advocated with Joan MacLeod Heminway in Blockchains, Corporate Governance, and the Lawyer’s Role[3] and with Gerlinde Berger-Walliser and Paul Shrivastava in Using Proactive Legal Strategies for Corporate Environmental Sustainability,[4] and (2) preserve a role for human discretion when the unforeseeable happens.
Question Two: will some of us keep working from home?
Answer: to some extent, for some of us, yes, this trend is likely to continue. Also, some administrative structures are likely to erode. Again, this trend was foreseeable prior to March of 2020: the same advances mentioned above can be used to automate the sets of rules-and-agreements that define our work relationships. Some administrative oversight and support roles will likely be automated away, especially as we realize the efficiencies of working remotely. On the other hand, once again, the current crisis highlights the need to proactively ponder what ethical standards we want to hardcode (whether intentionally, or de facto, through omission), as described in Tao of DAO: Hardcoding Business Ethics on Blockchain.[5]
Question Three: will demand for greater transparency in government continue?
Answer: depends on the government, but generally yes. In the USA, there have been demands for greater transparency, even from governments that are widely seen to have responded the COVID-19 outbreak comparatively effectively, such as California. In a recent article, City Sustainability Reporting: An Emerging and Desirable Legal Necessity,[6]I reviewed the evolution of the materiality standard and steps taken by the SEC, and suggested that reporting on a wider array of societal, environmental, and governance data is becoming a necessity for those local governments that have issued about $4 trillion in securities. So, regardless of the pandemic, I see this trend continuing.
Question Four: will we demand more transparency from businesses as well?
Answer: yes. We already see investors suing companies for misleading statements or lack of disclosure of risks related to the pandemic. I have been researching and writing about transparency since 2005, including how it relates to reputation,[7] to financial performance,[8] to share price and returns to investors,[9] to real estate law,[10] and to employee happiness,[11] plus differences in how we discuss such practices across cultures,[12] and the extent to which reporting on societal, environmental, and governance practices is an evolving legal expectation.[13]
I expect more research into the relationship between various firm characteristics, measures of performance, and transparency[14] — including in the context of China.[15]
Question Five: will private sector managers continue to promote new norms?
Answer: yes, and some have been embracing this, with positive effects for both shareholders and other stakeholders. Together with Mel Edwards and Ed Freeman (the father of stakeholder theory), we pointed out the trend and benefits of shaking stateholders out of complacency in our article, Shake Your Stakeholder: Firm Initiated Interactions to Create Shared Sustainable Value.[16]
Question Six: are trends in technology and transparency changing the role of lawyers?
Answer: yes. We described the need to for lawyers to adopt a more proactive mindset in articles with Joan MacLeod Heminway — Blockchains, Corporate Governance, and the Lawyer’s Role[17] — and with Gerlinde Berger-Walliser and Paul Shrivastava in Using Proactive Legal Strategies for Corporate Environmental Sustainability.[18]Undoubtedly, greater gathering, use of, and intended (or unintended, or even coerced) disclosure of data creates legal risk of which attorneys should be aware.[19]
Question Seven: do our laws and legal system need updating?
Answer: yes, and this realization has already broadened and accelerated. Fundamental assumptions of what is a government-guaranteed right vs. a privilege, or in the realm of “things that should be earned” have been challenged, in terms of our health and incomes. Technological change and platform capitalism (or “the gig economy”) already resulted in disputes about these issues. We are overdue for re-imagining some fundamental mental models — legal definitions, categories, relations, and implications — that are already quaint and obsolete — as argued in Industry 4.0 Era Technology (AI, Big Data, Blockchain, DAO): Why The Law Needs New Memes.[20]On a related note, there are also opportunities to remove perverse incentives in obsolete legal structures, as I explained with Mystica Alexander and William Wiggins.[21] On the other hand, some traditions[22] and little used statutes[23] should arguably be reinvigorated and used.
Question Eight: does education need to change? Specifically, do business and other professional schools need to evolve?
Answer: yes. We need more holistic and experiential approaches. Specific innovations in these directions are described in a chapter in the book, Handbook of Sustainability in Management Education[24] and in A Path to Developing More Insightful Business School Graduates: A Systems-Based, Experiential Approach to Integrating Law, Strategy, and Sustainability in Academy of Management Learning & Education.[25]
Question Nine: what about fundamental questions of meaning and happiness, and what we use as key performance indicators (of us, our organizations, and economies)?
Answer: this trend has also been accelerated, but whether questioning leads to the adoption of new mindsets and key performance metrics is less clear. Anyone watching stock market indices soar on the same day that millions of job losses and tens of thousands of deaths are announced has probably wondered whether about what we measure, how we track numbers, and whether that will change. It was none other than the inventor of GDP that argued against its use as measure of economic success, as pointed out with Sandra Waddock in our article, Midas, Cassandra & the Buddha: Curing Delusional Growth Myopia by Focusing on Thriving in the Journal of Corporate Citizenship,[26] as well as in the article below. As we reevaluate what brings joy and meaning in the current moment, and question mainstream measures of economic success, we can anticipate more curiosity about the relationship between happiness, consumption, and environmentally damaging activities of the early 21st Century. We should expect more research along the lines of what D. Steven White and I published, including A Happiness Kuznets Curve? Using Model-Based Cluster Analysis to Group Countries Based on Happiness, Development, Income, and Carbon Emissions,[27] and similar studies.[28]
Question Ten: any ideas where to look for inspiration? For a small business owner?
Answer: the most creative and inspiring entrepreneurship stories often occur in contexts of hardship or even where private business ownership is prohibited. The following case studies have all won awards and include references for further reading:
– first, how contaminated land can be turned into a business and community redevelopment opportunity: Sid Wainer & Son: A Growing Realization (2011 ALSB distinguished proceedings award winner).[29] For more on brownfielding, see There’s Gold in Them Thar Brownfields: the Legal Framework of Brownfield Redevelopment and Some Tips for Getting Started.[30]
– second, how taking a risk on a new business (and being open to radically new pivots) in an economically struggling former milltown can result in a set of thriving businesses: The Rail Trail Flatbread Co. (2017 USASBE case study award winner).
– third, the secrets-to-success of a former tailor making less than $1-per-day in the provinces of Cuba who started, owns, and runs a hospitality business in Havana that was recently rated as the #7 specialty accommodation in Cuba: Rodolfo’s Casa Caribe in Cuba: Business, Ethical & Legal Challenges of Investing in a Start-Up in Havana (2016 ALSB international case study award winner).[31]
– for more stories of entrepreneurship in contexts that seem extremely adverse, please see my website, www.Extreme-Entrepreneurship.com, where I am collecting such stories for an upcoming book.
[1] Please send feedback to asulkowski@babson.edu. Thanks to Jason Cipriano, Global Head of Supplier Relationship Management (SRM/VM) & Vice President, Sourcing & Procurement, for his valuable input, including the qualification that some of these anticipated trends have (to date) not occurred quite as fast as some had expected.
[2] Sulkowski, A. J. (2019). Blockchain, Business Supply Chains, Sustainability, and Law: The Future of Governance, Legal Frameworks, and Lawyers? Delaware Journal of Corporate Law, 43 (2), 303–345.
[3] Heminway, J. M., Sulkowski, A. J. (2019). Blockchains, Corporate Governance, and the Lawyer’s Role. Wayne Law Review, 65 (17), 17–55.
[4] Berger-Walliser, G., Sulkowski, A. J., & Shrivastava, P. (2017). Using Proactive Legal Strategies for Corporate Environmental Sustainability. Michigan Journal of Environmental & Administrative Law, 6 (1), 1- 35.
[5] Sulkowski, A. J. (2020). The Tao of DAO: Hardcoding Business Ethics on Blockchain. Business & Finance Law Review, 3 (2), 146–169.
[6] Sulkowski, A. J. (2016). City Sustainability Reporting: An Emerging and Desirable Legal Necessity. Pace Environmental Law Review, 33 (2), 278–299.
[7] Hughey, C. & Sulkowski, A.J. (2012). More Disclosure = Better CSR Reputation? An Examination of CSR Reputation Leaders and Laggards in the Global Oil & Gas Industry. Journal of the Academy of Business and Economics, 12 (2), 24–34.
[8] Wu, J., Liu, L. & Sulkowski, A.J. (2011). Environmental Disclosure, Firm Performance, and Firm Characteristics: An Analysis of S&P 100 Firms. Journal of the Academy of Business and Economics, 10 (4), 73–84.
[9] Sulkowski, A.J., Barboza, J. P., Vaillancourt, J. & Studnicka, A. (2011). What Aspects of CSR Really Matter: An Exploratory Study Using Workplace Mortality Data. International Academy of Business and Economics Proceedings.
[10] Sulkowski, A. J. (2010). The Growing Trend of Voluntary Corporate Responsibility Disclosure and Its Implications for Real Estate Attorneys. Real Estate Law Journal, 38 (4), 471–481.
[11] Walsh, C. & Sulkowski, A.J. (2010). A Greener Company Makes for Happier Employees More So Than Does a More Valuable One: A Regression Analysis of Employee Satisfaction, Perceived Environmental Performance and Firm Financial Value. Interdisciplinary Environmental Review, 11 (4), 274–282; see also Sulkowski, A.J. & Walsh, C. (2011). Employee Satisfaction and Environmental Reputation. Ökologisches Wirtschaften, 2/2011, 12–13.
[12] Sulkowski, A. J., Parashar, S.P. & Wei, L. (2008). Corporate Responsibility Reporting in China, India, Japan, and the West: One Mantra Does Not Fit All. New England Law Review, 42 (4), 787–808.
[13] Sulkowski, A. J. & Waddock, S. (2013). Beyond Sustainability Reporting: Integrated Reporting Is Practiced, Required & More Would Be Better. University of St. Thomas Law Review, 10 (4) 1060–1123.
[14] Sulkowski, A. J. & White, D. S. (2009). Financial Performance, Pollution Measures and the Propensity to Use Corporate Responsibility Reporting: Implications for Business and Legal Scholarship. Colorado Journal of International Environmental Law and Policy, 21 (3), 491–514.
[15] Wu, J., Liu, L. & Sulkowski, A.J. (2011). Environmental Disclosure, Firm Performance, and Firm Characteristics: An Analysis of S&P 100 Firms. Journal of the Academy of Business and Economics, 10 (4), 73–84.
[16] Sulkowski, A. J., Edwards, M., & Freeman, R. E. (2018). Shake Your Stakeholder: Firm Initiated Interactions to Create Shared Sustainable Value. Organization & Environment, 31 (3), 223–241.
[17] Heminway, J. M., Sulkowski, A. J. (2019). Blockchains, Corporate Governance, and the Lawyer’s Role. Wayne Law Review, 65 (17), 17–55.
[18] Berger-Walliser, G., Sulkowski, A. J., & Shrivastava, P. (2017). Using Proactive Legal Strategies for Corporate Environmental Sustainability. Michigan Journal of Environmental & Administrative Law, 6 (1), 1- 35.
[19] Sulkowski, A. J. (2007). Cyber-Extortion: Duties and Liabilities Related to the Elephant in the Server Room. Journal of Law, Technology and Policy, (1), 21–63.
[20] Sulkowski, A. J. (2019). Industry 4.0 Era Technology (AI, Big Data, Blockchain, DAO): Why The Law Needs New Memes, Kansas Journal of Law & Public Policy, 29 (1).
[21] Alexander, M., Sulkowski, A. J., & Wiggins, W. (2016). Sustainability & Tax Policy: Fixing a Patchwork of Policies with a Coherent Federal Framework. Virginia Environmental Law Review, 35 (1), 1–58.
[22] Sulkowski, A. J. & Greenfield, K. (2006). A Bridle, a Prod, and a Big Stick: An Evaluation of Class Actions, Shareholder Proposals, and the Ultra Vires Doctrine as Methods for Controlling Corporate Behavior. St. John’s Law Review, 79 (4), 929–954.
[23] Sulkowski, A. J. (2009). Ultra Vires Statutes: Alive, Kicking, and a Means of Circumventing the Scalia Standing Gauntlet in Environmental Litigation. Journal of Environmental Law and Litigation, 24 (1), 75–118.
[24] Sulkowski, A. J. (2017). University Experiential Learning Partnerships as Living Laboratories for Sustainability. Peer-reviewed chapter in book: SUSTAINABILITY IN MANAGEMENT EDUCATION: IN SEARCH OF A MULTIDISCIPLINARY, INNOVATIVE AND INTEGRATED APPROACH THROUGH UNIVERSITY LEADERSHIP, SCHOLARSHIP AND PARTNERSHIPS (Edward A. Arevalo and Shelley F. Mitchell, eds.), Edward Elgar.
[25] Bagley, C. E., Sulkowski, A. J., Nelson, J. S., Waddock, S., & Shrivastava, P. (published online November 7, 2019). A Path to Developing More Insightful Business School Graduates: A Systems-Based, Experiential Approach to Integrating Law, Strategy, and Sustainability, Academy of Management Learning & Education (in press).
[26] Sulkowski, A. J. & Waddock, S. (2016). Midas, Cassandra & the Buddha: Curing Delusional Growth Myopia by Focusing on Thriving. Journal of Corporate Citizenship, 61, 15–43.
[27] Sulkowski, A. J. & White, D. S. (2016). A Happiness Kuznets Curve? Using Model-Based Cluster Analysis to Group Countries Based on Happiness, Development, Income, and Carbon Emissions. Environment, Development and Sustainability, 18 (4), 1095–1111.
[28] White, D. S. & Sulkowski, A. J. (2010). Relative Ecological Footprints Based on Resource Usage Efficiency Per Capita: Macro-level Segmentation of 121 Countries. International Journal of Sustainable Economy, 2 (2), 224–240; Sulkowski, A. J. & White, D. S. (2009). Consumption of Energy, CO2 Emissions and Materials Usage Efficiency per Capita: A Cluster Analysis of Europe and Eurasia. Global Management Journal, 1 (1), 55–65.
[29] Sulkowski, A. J. & Vardaro, N. (2011). Sid Wainer & Son: A Growing Realization. Academy of Legal Studies in Business.
[30] Sulkowski, A. J. (2010). There’s Gold in Them Thar Brownfields: The Legal Framework of Brownfielding and Some Tips on for Getting Started. Real Estate Law Journal, 39 (1) 100–112.
[31] Sulkowski, A. J. (2017). Rodolfo’s Casa Caribe in Cuba: Business, Ethical & Legal Challenges of Investing in a Start-Up in Havana. Journal of Legal Studies Education, 34 (1), 127–162.
