Megatrends shaping our world and work

Drawing on EBRD strengths and tools, the Bank and its enhanced approach to equality of opportunity and human capital considers the impacts of megatrends and large-scale shocks on inequalities. It has enabled EBRD to expand the breadth and depth of its support to clients and policy stakeholders that promote inclusive transition impact. It has also allowed the institution to remain agile and respond promptly to new and emerging trends, global and regional shocks, war and natural crises. The Bank has operationalised its approach to shocks with a focus on strengthening human capital resilience and protecting livelihoods by meeting the needs of businesses and local communities in EBRD regions increasingly challenged by war, fragility or natural disasters.   

The three priority strategic areas further support EBRD’s expanded economic inclusion engagement, by applying four thematic lenses (mega trends) and shocks that create additional drivers for inequality of opportunity. Thematic lenses on the Green Economy and the Digital Economy reflect new opportunities for greater EBRD impact on economic inclusion. Lenses on urbanisation, regional disparities and migration recognise the changing global value chains that alter regional economic prospects and opportunities. Moreover, the focus on large-scale shocks explicitly amplifies the Bank’s work on existing and persistent constraints to economic inclusion in crisis affected areas. 

Climate change

The EBRD is committed to preserving livelihoods and to building human capital in the face of the economic disruption climate change is causing. There is a strong business case for the gender equality and climate action nexus: as active economic and social actors, women are key agents of change in the green transition. Firms that invest in promoting female talent, green tech and green skills will have a competitive advantage.

Women are often early adopters of green technology solutions and represent an untapped market potential in the energy efficiency sector. According to recent research, with more women on boards of financial institutions, banks invest less in CO2 emitting companies. And companies with more women in managerial positions cut emissions faster. But women are not the only target group: the energy transition will create 14 million new jobs.

However, to ensure that the green transition is a Just Transition, we need to protect vulnerable regions and people from falling behind. Our work is focused on supporting our clients in developing forward-looking workforce planning and management measures, and in providing upskilling and career guidance services to workers directly or indirectly affected by the transition. We also support regional economic diversification to promote access to alternative livelihoods, as well as gender mainstreaming across just transition activities by applying a gender lens into regional planning processes and supporting the role of women across the traditionally male-dominated energy sector.

Digitalisation

Digitalisation is an important aspect of enhancing the equality of opportunity and gender equality across the EBRD region. New digital technologies can improve access to employment, entrepreneurship, finance, skills, and services for women, young individuals, people in rural regions, disabled people and other disadvantaged groups. Digitalisation can also offer the potential to build human capital in a country more widely and equip people with the skills, access to services, finance and markets that they require to rebound from economic shocks and long-term stressors such as climate change.

The digital divide in terms of usage of internet, smartphones, and ICT skills is still a reality across the EBRD economies. Equality of opportunity suffers when technologies are not available or affordable for everyone, or when the digital skills needed to navigate them are not widespread. The EBRD plays a key role in narrowing down the digital divide in access, affordability and skills across its economies.

We do it by investing in broadband infrastructure supporting access to essential services and affordable technology for all target groups. We also promote the acquisition of crucial digital skills, particularly among women entrepreneurs and employees, and create pathways for underrepresented students to access STEM degrees. And lastly, we invest in fintech and mobile banking technologies that provide financial inclusion to previously unbanked segments and support access to finance to underserved entrepreneurs and SMEs. 

Urbanisation, regional disparities and migration

Trends across the EBRD region show rising within-country inequality, affecting economic development, labour productivity and enabling business environments. Especially in post-communist countries, income growth has been focused at the top of the income distribution, with wealth being more concentrated among the very rich than in comparable economies elsewhere in the world.

At the same time, population growth of cities has come at the expense of towns and rural areas; in almost half of EBRD’s CoOs, more than 50 per cent of the population now lives in areas with declining population density.  EBRD will focus on regions based on a number of factors reflecting EBRD’s demand-driven approach, alignment with country and sectoral strategies and the suitability of local economic conditions:  

Large scale shocks and fragility

Our new and interlinked strategies recognise fragility and conflict, as well as migration and forced displacement, as important areas of engagement for the Bank. The EBRD is committed to supporting people, businesses and regions affected by the impacts that sudden shocks, including violence and conflict, can have on them. Moreover, we recognise that providing transformative gender equality support to our clients and policy partners requires politically informed understanding of gender, fragility and conflict, with a strong focus on women as actors and agents of change contributing to wider peacebuilding and state-building efforts.

A focus on people, businesses and communities is central to EBRD’s work in fragile contexts. For example, through our response to the war on Ukraine, EBRD works to ensure continued access to vital services and supports companies to conduct business to the extent possible, in order to safeguard the basic needs and economic livelihoods of those fleeing the conflict as well as the hosting communities, and to preserve and build the human capital in the affected countries.