ST. GALLEN WINGS OF EXCELLENCE AWARD 2017

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1 ST. GALLEN WINGS OF EXCELLENCE AWARD 2017 The ISC proudly presents the semi-finalists of the St. Gallen Wings of Excellence Award These students have convinced the jury with their disruptive ideas. The six very best make it into the final to present and discuss their concepts and possible solutions on the big stage at the 47 th St. Gallen Symposium (3 5 May 2017). The finalists will be announced on 27 April Page Page Remo Brechbühl (CH) Universität St. Gallen...2 Aditya Chintalapati (IN) University of Michigan...3 Theodore Clifford (CA) York University...4 Mehta Devansh (IN) Columbia University...5 Martin Foo (AU) Monash University...6 Keith Harry Gesche (DE) London Business School...7 Benjamin Hofmann (DE) Universität St. Gallen...8 Rishi Jaggernauth (US) New York University...9 Moritz-Christian Meyer (DE) Stockholm School of Economics...10 Tamsin Nicholson (UK) University of Glasgow...12 Laura Niersbach (DE) Columbia University...13 Sigin Ojulu (SS) University of Southern California...14 Markus Ott (DE) Universität St. Gallen...15 Chenhong Peng (CN) The University of Hong Kong...16 Nicola Plummer (CA) University of Toronto...17 Ronak Ravindran (IN) Institute of Company Secretaries of India...18 Nat Ware (UK) University of Oxford...19 Lina Zdruli (AL) Georgetown University...20 Declan Murray (UK) University of Edinburgh

2 Remo Brechbühl (CH) University of St. Gallen Disrupting corruption in state-controlled companies A brief outline how blockchain technology enables an inclusive economic development in emerging countries Brazil and other emerging countries have been growing rapidly during the last decade because of their integration into the global economy, institutional and economic stabilization as well as China s demand for commodities. However, additionally to macroeconomic factors, corruption in state-controlled companies like in the case of the Petrobras scandal in Brazil is one of the main reasons which impede broad-based economic growth in resource-rich and developing countries. Their governments are often not able to control their administration and to enforce good governance principles in their companies. This allows that politicians and top managers enrich themselves by the funds of these companies at the cost of the population. Therefore, a technology is needed which provides transparency, defines, as well as ensures responsibilities in state-controlled enterprises, and which works independently from any error-prone central control authority like governments. Blockchain technology s characteristics as decentralised and distributed ledger of transactions backed by sophisticated cryptography meet these requirements and can disrupt the global problem of corruption in state-controlled companies. Blockchain technology based applications including digital currencies like bitcoin along with public ledgers and smart contracts empower to monitor as well as control the transactions of state-controlled companies algorithmically and by the ledger s participants. Thus, the use of blockchain technology s applications are fundamental for disrupting corruption in state-controlled companies and to lead these countries back to the path to inclusive and sustainable economic development. 2

3 Aditya Chintalapati (IN) University of Michigan Governments of the world need to be in the business of creating second chances A recent report from McKinsey s Global Institute estimated that there were 40 million unemployed people in advanced economies, and tens of millions that were underemployed or had dropped out of the workforce because they were discouraged. Another report by the World Economic Forum indicates that 65% of children entering primary school in 2016 would take up jobs that do not yet exist. The consulting firm CBRE surveyed business experts who predicted that 50% of occupations would not exist by Evidence from technology changes driven by advances in Data Science and Artificial Intelligence points to the fact that low skilled, process driven work will almost entirely be eliminated in the coming years. There needs to be a radical shift in how the governments of the world provide for people, create new jobs, and ensure that they provide opportunity for the displaced. My idea to tackle this problem is that governments of the world should directly hire people for jobs and focus on training them while they are working. Governments need to move from an economic policy of creating an environment to attract jobs to creating the job itself, either directly or through negotiations with private firms. The focus of this essay will be limited to advanced economies but the themes can be extrapolated to emerging markets in the future. 3

4 Theodore Clifford (CA) York University Foreign aid Uncomfortable choices The 8 Millennium development goals should be reduced to two: feed the hungry and combat infectious diseases. Even if every dollar of foreign aid was directed to these two goals, there would still be a $150 billion shortfall in donations. Thus, we must make uncomfortable allocation decisions. We must adopt strategic principles to guide this allocation. A prioritisation system devoid of the tarnishment brought by donating nations using aid to further their geopolitical ambitions must prevail. Prioritisations should reflect the classification of recipient countries. In rank order of priority, temporary need and intermittent need areas outrank continuous need areas. Countries where governments do not meet with their obligations to reduce their need should be deprioritised. Countries where officials or brigands have corrupted aid donations must be reduced in priority or sanctioned by suspension of all aid. All starving children are morally equal. It is difficult to make decisions that would leave any of them hungry. Donating countries are not prepared to provide sufficient resources to solve their morally acknowledged obligation. A duality exists between hunger and conflict. Failure to take significant steps toward solving the hunger problem is folly. 4

5 Mehta Devansh (IN) Columbia University Non-profit mines: A way to combat poverty and break the resource curse The resource curse has ravaged and afflicted countries all over the world, particularly those in the African continent. Experience has shown that current policy interventions for distributing wealth largely consisting of stipulations that foreign companies give stakes to local partners has failed, either getting bogged down by corruption or resulting in the creation of local moguls. A new approach is required for ensuring that countries equitably distribute the wealth of natural resources. This author recommends that, before awarding exploratory licenses to companies, governments stipulate that a significant portion of newly discovered reserves be given to a large philanthropic foundation for the establishment of nonprofit mines. Profits made in the course of mining would be mandatorily reinvested into local communities and surrounding areas, which would soon become hubs of development and opportunity. Operationalising non-profit mines would require a one-time donation from different stakeholders that would yield benefits years into the future. 5

6 Martin Foo (AU) Monash University Start-up nations Disrupting modern governance Trust in the institutions of government and faith in democracy are on the decline. At the same time, society has become more risk-averse, with innovation suppressed by the accumulation of obsolete regulations and the influence of vested interests. What if it were possible to readily form entirely new quasi-states, and thereby to experiment with different models of governance? I propose a mechanism for modern governments to create start-up nations : small, autonomous regions that would function as testbeds for political experimentation. Different start-up nations could trial different combinations of laws, rights, and liberties. Lessons learned from existing dependent territories including the Cook Islands, Hong Kong, and Puerto Rico provide useful insight into how such a start-up nation might acquire legal status. Because they would not be constrained by the inertia and aversion to risk that have beset today s democratic states, start-up nations would be sanctuaries for innovators and could be the disruption that blossoms into a thousand other disruptions. 6

7 Keith Harry Gesche (DE) London Business School The Graduate Programme Politics Creating future leaders in politics In the current times that are defined by increasing political volatility due to the rise of right-wing powers and the dissatisfaction of voters with current governments in power, the need for young political leaders is more relevant than ever before. However, political parties struggle to incentivise high-potentials to pursue political careers, as the general opinion suggests that these are neither financially attractive nor do they offer promising career prospects. At the same time, surprisingly, political foundations invest tremendous amounts of resources into the support of students regardless of their interest in politics, while failing to support politically engaged and therefore, failing to invest in their own future. In my essay The Graduate Programme Politics, I introduce and discuss the concept of a political graduate programme using the example of Germany that will incentivise talented and politically interested students both financially as well as educationally at a world-class level. The programme will be financed by reallocating existing funds from scholarships of political foundations for general students towards the ones that pursue political careers. It involves a joint programme between major political party foundations that will further support future political leaders with cultural, political and social training, while at the same time offering network building opportunities and practical experiences within the government. The programme will boost the awareness of the current generation towards political engagement, as well as increase the attractiveness of political careers for students that otherwise would decide for consulting, banking or other financially more attractive industries. The concept, therefore, pursues to support future political leaders that are educated at the highest level, both internationally and culturally, in order to be able to represent the interest of our generation better than the current political leadership ever could. 7

8 Benjamin Hofmann (DE) University of St. Gallen Saving liberalism: Governance through Global Hanses Liberalism the fabric of the current world order is seriously challenged these days. Protectionism pushes back free trade, authoritarianism threatens liberal democratic institutions, and nationalism undermines regional integration. The decline of liberalism heralds a return of history that will make the world less prosperous and less safe. Protectionism will trigger trade wars and economic recession, and nationalist authoritarianism will fuel armed conflict. The essay argues that the crisis of liberalism is due to an inappropriate governance of globalisation. Globalisation has differential effects on communities. Adaptive globalised communities benefit from globalisation and thus support libertarian values. Communities that are less willing or able to adapt are more supportive of authoritarian stances. Neither the nation-state nor existing global governance institutions can accommodate this widening cleavage. The essay sketches the disruptive idea of governing through Global Hanses. Global Hanses are flexible policy collaborations of globalised regions and municipalities. They translate the historic role model of the Hanseatic League into a socially and economically unevenly globalized world. Global Hanses are democratic, overlapping, and competing. Their members benefit from devolved competencies, but share part of their profits with less adaptive communities. The essay proposes to launch a first Global Hanse on digitalisation, education, and social cohesion. It can later also develop joint policies on other issues, such as innovation, energy, migration, and trade in services. Global Hanses tailor globalisation to the needs and capacities of different communities. An emerging network of successful Global Hanses will rebuild public support for political and economic liberalism. It will also create new glocal identities that help to overcome old nationalisms. 8

9 Rishi Jaggernauth (US) New York University CRISPR-based antibiotics: A novel solution for antibiotic resistance Antibiotic resistance is one of the defining challenges of the 21 st Century. Despite growing urgency about this issue worldwide, the pace of drug development has not kept up with the need for innovative antibiotics. The recent discovery of a gene editing tool known as Clustered Regularly Interspaced Palindromic Repeats (CRISPR) has the potential to revolutionise the treatment of bacterial infections and refortify our existing supply of antibiotics. By leveraging the power of gene editing, CRISPR offers a customized therapeutic approach that addresses the fundamental issue of genetic mutation that underlies the problem of antibiotic resistance. CRISPR can functionally delete the parts of the genome that cause antibiotic resistance in pathogenic bacteria, rendering these bacterial species susceptible to existing antibiotics. The genetic sequence targeted for deletion by the CRISPR construct can be changed to reflect the newest bacterial mutations, enabling existing antibiotics to maintain their effectiveness in the face of the continued evolution of these drug-resistant pathogens. CRISPR-based antibiotics have the potential to offer a personalized, targeted therapeutic approach for antibiotic resistance, strengthen our public healthcare infrastructure, and reduce healthcare expenditures worldwide. Although some challenges including drug delivery and safety concerns will need to be addressed, CRISPR-based antibiotics are a novel solution to the antibiotic resistance crisis that can dramatically improve the lives of millions worldwide. 9

10 Moritz-Christian Meyer (DE) Stockholm School of Economics Creating a United Nations Parliament of the People The work and the actions of the United Nations are currently determined by the Member States of the United Nations. Sadly, all too often the Member States act according to their national interest rather than for the good of humanity. It is therefore time to empower the people of the world by establishing a United Nations Parliament of the People. Created as a principal organ of the United Nations and consisting of members elected directly by the people around the world, the Parliament will advance the aims of the organisation. It will give a voice to the people, be able to implement programmes currently blocked by special interests, and lobby states to take action. The advantages of such a Parliament not only include to act independently from any national interest, but also an increased sense of ownership of the United Nations by the people and a better idea creation within the organisation. 10

11 Declan Murray (UK) University of Edinburgh Disruptive Renovation: Reducing e-waste in Africa through repair In the last ten years small-scale solar power has taken off across Africa: 221 million people previously living without electricity are now able to watch TV and light their homes in the evening. But when these systems break, users are left in the dark and more electronic waste piles up in rural areas. What if there was a way to change that? The expanding provision of energy, by way of standalone solar products, is bringing electronic life to new areas of sub-saharan Africa. However, the companies leading this solar market are also bringing with them a foreign business model where the customer retains a connection to the manufacturer through daily or monthly payments. While paying in instalments makes the technology affordable, it is the post-sale part of the model that customers are not accustomed to. These new solar companies do not repair broken systems but replace them. This runs counter to a long tradition of repair in many African societies. My innovation is to support local repair networks by way of the distribution of spare parts for solar products through a business called Solar Spares. 11

12 Tamsin Nicholson (UK) University of Glasgow Breaking the status quo: Incorporating conditioned placebo response into treatment plans to improve access to medicine in least developed countries Improving access to medicine is one of the greatest challenges in global medicine. Currently, 50% of the population in the least developed countries (LDC s) in Africa and Asia do not have access to essential medication, contributing to the significantly lower (17.5 years less) life expectancy in LDC s compared to developed countries. But there may be an answer to this problem. Research has shown that some patients given an active medication for 4 days, followed by a placebo, will respond to the placebo as if it were the active drug for 48 hours. This is the conditioned placebo response and if applied in global medicine, it could potentially reduce the cost and amount of active medication required by one third. But there are ethical implications to this approach: informed consent, treatment efficacy standards and others. However, research has shown that patient deception is not always necessary and that the conditioned placebo response could have equal efficacy to the standard treatment. Much research still needs to be done to clarify the potential of this approach, but the prospective benefits are high and the costs low. There is the potential to greatly improve access to life changing medication in LDC s. 12

13 Laura Niersbach (DE) Columbia University Disrupting democracy A Design Thinking approach for public policy Western liberal democracies are experiencing a crisis. As established politicians are increasingly failing to convince their voters of the continued value of open and inclusive societies, right-wing populism is on the rise. One of the recurring explanations for this political phenomenon is a widening gap between political elites and citizens, who feel like their concerns are not being heard anymore. As a result, many people either protest by voting populist or by completely withdrawing from public policy. The latter is especially the case for younger citizens. This development is extremely worrisome for the future of Western democracies and thus has to be addressed by our political leaders. What our societies need at this point is nothing less than a disruption of current political structures, closing the gap between politicians and citizens and reviving our democracies, particularly by motivating the generations of tomorrow to engage in public policy. In the following essay, I want to propose how this disruption of democracy can be inspired by design thinking, a creative and innovative problem-solving approach applied by many successful businesses. Following this human-centered approach, I will specifically propose a civic engagement platform for German policy-making. I envision that the interaction facilitated through such a platform will help politicians to better understand the concerns of their citizens and to then co-create innovative policies that adequately address these needs. This will help political leaders to reconnect to their citizens and thus to preserve the value of our democracies. 13

14 Sigin Ojulu (SS) University of Southern California Strategic Virtual Task Simulations (SVTS) & Learning An underlying issue of global divisions is not that we do not have information to mediate for solutions, rather that the information that we receive is highly biased and acquired inefficiently. Our educational institutions play a large role in solidifying the knowledge of our milieu and do little to support the technologically interactive digital natives in this new generation of learning. Through Strategic Virtual Task Simulations employed in various fields, we are able to problem solve through the effective constructionist theory of learning. Task simulations will provoke interaction with real-world issues and place emphasis on developing the individual, for the purpose of larger, more persistent issues in our world. By encoding a personal virtual experience into our physical wiring, we are able to contextualise our learning (and by extension encode empathy) towards problems and conflicts that seem far from us, and sometimes in a different world. 14

15 Markus Ott (DE) Universität St. Gallen 2 C scenario aligned investing: the missing link This essay argues that although new digital technologies may change the way financial institutions operate, these developments do not necessarily alter the status quo of the financial system as a whole. One must question the purpose of the system to fundamentally break its status quo. Public and private investments are key to limiting global warming to well below 2 Celsius, the central goal of the Paris agreement on climate change. However, current investment strategies remain largely misaligned and detached from international climate goals. The disruptive idea presented in the essay establishes this crucial link between investment decisions and global climate goals through a 2 C benchmark for investment portfolios. The benchmark is based on the Sectoral Decarbonisation Approach (SDA) developed by the Science Based Targets Initiative and allows the comparison of the actual CO 2 -intensity of a given public equity portfolio with the respective 2 C scenario-aligned CO 2 -intensity in accordance with the Paris agreement. The added value of such a benchmark is threefold: I) Enable governments to define meaningful target values for future climate-related regulations addressing the financial system. II) Provide financial institutions with a tool to internalise climate change related externalities, such as new regulations, which will lead to a convergence of climate-friendly investment and profit maximisation. III) Increase transparency for clients and investors alike. 15

16 Chenhong Peng (CN) The University of Hong Kong EduDreamer: A disruptive idea to break the intergenerational cycle of disadvantage In a society with low intergenerational mobility, people s chances to success is highly associated with their parental background. Rich stay rich and poor stay poor. Human capital is a key pathway that parents pass on their economic status to their children: parents invest in their children s formal education, home-learning environment and extra-curricular activities, and this accumulated human capital will get rewarded in the labor market. Lots of effort has been made to equalise the opportunity in formal education. However, researchers have found that parents investment in home-learning and extra-curricular activities plays a bigger role in intergenerational persistence. Therefore, in order to break the intergenerational cycle of disadvantage, I propose an idea called EduDreamer, which is a crowdfunding platform that helps children from disadvantaged families to find the resources and the support they need to enrich their extra-curricular and home-learning experiences. The mission of EduDreamer is to build an inclusive and vibrant society for child development. First, children and their parents will find the projects they would like to participate. Then, they are required to submit an application to illustrate their motivations, the total amount of money required, and the expected outcomes they would like to obtain. Then the application will go to fund raising period. Whoever cares for child development is welcome to become a donor. Instead of being passive donators, they could choose the child and the project they would like to support and monitor the whole learning process. 16

17 Nicola Plummer (CA) University of Toronto We owed you better: The women s corporate ladder Institutionalised gender disparity exists at the highest levels of every profession. The dearth of women in positions of power leads to decisions made by men that cannot effectively address problems faced by the other half of our population. More troubling though, our institutions are set up to perpetuate this gender disparity. I argue that the inability of women to reach the top of the corporate ladder is not a failure of women, but a failure of institutions. The question is not how do you succeed in a system that wasn t built for you. We have seen time and time again that some women can and do succeed. The question is, how can every woman have the opportunity to succeed in a system that wasn t built for them. The answer to me is quite simple: the system must be changed. Breaking the status quo for women in the corporate world should look to disrupt three parts of the current system in order to create one that is built not just with men in mind. This can be done at three points along the corporate ladder. Specifically, I propose a gender-sensitive approach to the MBA, mandatory maternal and paternal leave, and the restructuring of our current school schedule. While each of these ideas have been floated or talked about in isolation, I think packaging them together is what offers a truly novel approach to our society s collective failure to support women to the top. Together they represent a bold and radical vision: a system built with women in mind. 17

18 Ronak Ravindran (IN) The Institute of Company Secretaries of India Dealsparc.com - The disruption of Wall Street. While global M&A is sized at $3.7 trillion annually, investment banks mandates include identifying potential acquirers and targets, examining their strategic fit and synergies, arriving at the all-important valuations and structuring the deals. Yet, a Harvard Business Review report detailed that over 60% of deals fail, faltering in those precise areas. History has shown us that investment banks distort valuations and overestimate synergies and strategic fits, all in the endeavour of influencing their clients to sign on the dotted line. In a 2015 letter to Berkshire Hathaway shareholders, Warren Buffett labelled investment bankers as near-sighted, self-serving and pressing for deals that aren t always in the best long-term interest of their clients. So then, why do companies hire investment banks? And is there an innovation that could give companies a more effective and less expensive option? An open, global M&A deals platform is the disruptive need of the hour. A web-based and app-based global platform that links potential acquirers, targets and deal financiers, sans the shortcomings of investment banks, is the innovation that both corporates and M&A need. With a multi-trillion annual global M&A market and eight-tenths of companies still relying on investment banks, the size of the potential market for such an innovation is immense. While dealsparc.com could indeed be the name for such a platform, its last five letters elucidate its features, offerings and proposed modus operandi Simplicity, Pricing, Autonomy, Repository and Confidentiality. By facilitating both M&A and the funding thereof, while side-stepping the limitations of investment banks, the platform can be an M&Ahungry corporate s first port of call, rendering many an investment bank redundant. Dealsparc.com may not just be the catalyst that ignites and revolutionises the world of M&A. It could very well be the disruptive innovation that turns out to be investment banking s biggest deal-breaker. 18

19 Nat Ware (UK) University of Oxford Tradable income-based securities (TIBS) as a mechanism to improve the provision of services to disadvantaged populations One of the world s most intractable challenges is how to finance high-quality services for people in need, including resettled refugees, indigenous populations, and people who need retraining due to technology-induced unemployment. These people all need high-quality services, such as education and healthcare, to gain employment and achieve their potential. However, existing ways of financing services are not scalable. This essay presents an innovative, viable way to finance high-quality services to disadvantaged populations at scale. Remarkably, this new financing approach (a) does not rely on payments from the individuals receiving services, (b) does not rely on donations, (c) does not cost the government anything, and (d) generates profit for investors. The idea is for a new type of public-private partnership utilising Tradable Income-Based Securities (TIBS). It is based on the realisation that when high-quality investments are made in human capital, the effect is increased expected lifetime incomes of those receiving investments, and therefore higher government taxation revenue. Social value creation leads to subsequent financial value creation. TIBS involves the government contracting with investors to provide services, such as vocational training, to consenting individuals. Rather than paying investors in traditional ways, the government instead issues investors with securities that pay out annually as a function of the taxation revenue attributable to those receiving services. The right to this flow of payments is tradable, meaning investors can profit in the short-term. Importantly, the profit-maximising decision for investors is to provide the highest-quality services so as to maximise the wellbeing and expected incomes of the recipients, thereby increasing the price of TIBS. Thus, social and financial returns are perfectly aligned. This is a truly mutually beneficial arrangement. Individuals receive high-quality services and just pay the usual taxation rate, governments only pass on what they otherwise would not have received, and investors have uncapped upside. 19

20 Lina Zdruli (AL) Georgetown University Private sector solutions to refugee integration and employment in the E.U. There are over 60 million displaced people in the world, either internally within their own countries or accepted as refugees in other nations. Governments and international organisations identify the lack of resources as one of the greatest barriers to achieving long-term success for refugee assistance programming. This paper identifies examples of private sector intervention towards refugee access to employment and community integration, with the aim of finding models to replicate and scale in the European Union (EU). By offering the economic incentives to firms and models of employment that have already worked, the authors hopes to increase the number of refugees in the E.U. workforce. This paper argues the adoption of prepaid digital payments, technology and workforce-specific training for refugees, companies can will unleash the working potential and reduce social tension. Through the workplace, EU citizens will familiarise connect with refugees personally on a more personal level, which in turn and ultimately will reduce the levels of racism and intolerance that have begun to exacerbate. 20