Global powerplays

  • Date:01 Apr 2015
  • Type:Company Director Magazine
Alexandra Cain talks to Dr Anne-Marie Slaughter about the need to change governance structures that reflect the state of the world in 1945.


One of the world’s pre-eminent foreign policy academics says it is possible to reform global governance structures by 2020 to make them better reflect the current geopolitical situation. But the kicker is that there must be willingness among US policymakers for this to happen.
Dr Anne-Marie Slaughter, a Princeton University foreign policy professor emerita, the president of public policy institute the New America Foundation and a former top official at the US State Department, believes that the present global governance structure is badly out of date and only reflects the distribution of power that existed in 1945.

She says it will be impossible to solve the world’s problems without changing the structure of major global institutions. Dr Slaughter is a keynote speaker at the Australian Institute of Company Directors’ upcoming annual conference, Directorship:15.

“There have been modest changes at the International Monetary Fund, but that is still headed by a European and the World Bank is led by an American,” she argues.

Dr Slaughter says a barrier at the moment is that even small changes to the distribution of voting power in global institutions, including the United Nations (UN), are hotly contested. “This won’t do and we need to get to somewhere else. We need real leadership from Europe, the US and to a lesser extent Japan on these issues.

“Paradoxically, it’s actually in the self-interest of the leading powers to make room for rising powers within global institutions so that the institutions themselves will remain relevant,” she says, acknowledging that this would be an act of “extraordinary statesmanship.”

Much-needed reform
Dr Slaughter argues that unless the existing global organisations recognise the critical need for reform, a rising number of regional bodies will emerge, gain power and supercede them. “The UN Security Council needs to reform. We’re seeing a proliferation of informal arrangements because the formal arrangements we have in place are not working.”

She says clear evidence for the need for change is that right now the world is in a position in which the Security Council cannot agree whether or not to use force in the Middle East.

“The only reason the [US] government received Security Council approval to go into East Timor is because [the] Kosovo [war] went before it. NATO went in without Security Council approval and because of that, China and Russia were worried that unless they allowed action [in Timor], the council would be bypassed [in future conflicts].”

Dr Slaughter says this situation will happen again and again until substantial changes happen at the hearts of the major global bodies.

She argues that the last time the big global governing bodies came close to a meaningful  change to the way they work was in 2005 when Germany, Japan, India and Brazil came together to mount a campaign to change the structure of these institutions.

The question they struggled with was whether any change to the composition of these bodies would be permanent or on a rotating basis. Says Dr Slaughter: “If it’s a rotating situation the assumption is the big world powers will be represented 90 per cent of the time on these governing bodies.”

For action to happen, there has to be preparedness for change within the US administration. What might prompt action at this end is the thought of a world in which there are no central institutions that have credibility and the ability to effect change on a global scale.

This is increasingly where the world is headed, which is why it’s in the US’ interest to pursue a policy of change at the top of the main international bodies.
“Having the US engaged in this issue would be enough to get moving on it. Once that happened, it would mobilise other countries,” says Dr Slaughter.
She says any change would have to start with the UN. “If it was better able to act it could create a ripple effect and other institutions would be more inclined to follow.”

In terms of changes that need to happen to the main governing bodies in the Asia Pacific region, Dr Slaughter says the Assocation of Southeast Asian Nations (ASEAN) is already in a strong position.

She says she’s a strong supporter of the Trans-Pacific Partnership Agreement (TPP), a proposed and somewhat controversial free-trade arrangement under negotiation between countries that surround the Pacific ring.

A combination of ASEAN and its various outreach groups, the TPP and a global NATO partnership should have enough muscle to help resolve any geopolitical or geoeconomic problems that arise in the region.

Dr Slaughter says such a situation is not optimal for the Southeast Asia Pacific region because ideally one regional organisation, including all the major powers with jurisdiction over economic and security issues, would have overarching responsibility for security and economic issues in the region.

But realistically, the ASEAN, TPP and global NATO triumvirate might be the best option that can be hoped for in the near term.

The case for board diversity
“The data is in and companies with more diverse boards of directors do better, so it’s a question of self-interest,” commented Dr Anne-Marie Slaughter, keynote speaker at the Australian Institute of Company Directors’ annual conference, Directorship:15, when asked why board diversity matters.

Dr Slaughter says the main barrier to diversity is a universal phenomenon whereby humans tend to hire people who are like them, rather than seek out people who are different in terms of gender, race and other demographic factors.

She says the only way to overcome this is to have formal or, preferably, more informal quota systems to encourage diversity. Once quota systems are successful in changing board composition, diversity will recede as an issue because the patchwork nature of boards will naturally facilitate a culture in which people from many different backgrounds are represented.

Dr Slaughter names her own university, Princeton, and the University of Pennsylvania as two institutions that are succeeding in board diversity.

“Hillary Clinton was also very successful when she ran the [US] State Department. Three out of six under-secretaries were women and many assistant secretaries were also female.”

So how to bring men along in this shifting dynamic? She says change often happens when powerful men see their highly educated and competent daughters prevented from holding positions of seniority because of their gender.