Embracing Change for a Sustainable Future
By Alexandra Loli, PhD | Business Partners, Nov-Dec 2023

Climate change is the most pressing global challenge of our time. While corporations, governments, and individuals have a crucial role to play in turning the tide, the role of banks is pivotal. Financial institutions wield significant influence and resources that can be directed to drive sustainability initiatives and enable an accelerated decarbonization of our economy. Moreover, while sustainability offers up many challenges, it also opens up new opportunities for Greek banks as they seek to regain their role as drivers of Greece’s economic growth.

Banks can directly influence the sustainability agenda along four key axes: financing bias, transition and adaptation financing, green (investment) products, and education and climate risk transparency.

The role of banks is not simply to make responsible financial decisions but also to foster a sustainable future for all

One of the primary ways in which banks impact climate change is through their financing activities. Banks provide loans and capital to various sectors of the economy. By incorporating sustainability criteria in their credit assessments, borrowers with more sustainable business practices can benefit from comparatively reduced borrowing costs, making for a significant incentive to shift towards more sustainable operations. Conversely, banks can scrutinize and limit funding for businesses that do not adhere to certain environmental standards.

Banks can also serve as a catalyst for companies transitioning to low-carbon and more sustainable technologies. In Greece, acting as the primary channel for the distribution of subsidized transition funding (e.g. RRF), in combination with their own green funding initiatives, banks are instrumental in accelerating the transition to meet the national targets while also expanding their own business activities.

In retail banking and investment, offering green investment products enables clients to make eco-conscious financial decisions and, as a consequence, further reinforces funding for sustainable initiatives and projects. A broad selection of such products—from ESG mutual funds, green bonds, and green savings accounts to sustainable agriculture or renewable energy funds—ensures attractive propositions for a wide variety of customer profiles and interest rate environments.

In Greece, a country dominated by small businesses and SMEs, there is high variability in the awareness of the implications of the climate crisis and the upcoming implications for businesses: regulatory, financing, but also operational risk. Here also, banks have a critical role to play, in educating the broader business community and society through the regular touch points with their clients but also through dedicated events, such as workshops and seminars, and public campaigns.

In summary, banks have a critical role to play in addressing climate change due to their far-reaching influence over the Greek economy’s capital flow. They can leverage their financial resources to influence lending decisions, promote green finance, and drive the adoption of sustainable practices. Their role is not simply to make responsible financial decisions but also to foster a sustainable future for all through informing and educating the broader community and mobilizing it to action. Recognizing their pivotal position and the clear business opportunities it can bring, banks can act as drivers of positive change in the face of this pressing global challenge.

Greece’s economic progress is accelerating, and this is reflected in the recent upgrade of its investment grade and the rapid acceleration of a profound end-to-end digital transformation. This is an exciting period and a unique opportunity for the technology sector, as it is expected to surge throughout 2024, reflecting the promising landscape of Greece’s evolution. In addition, the Greek government, recognizing AI as a gamechanger, has set up a high-level advisory committee to harness AI’s potential, which is expected to unlock up to $16 trillion by 2030. Like any powerful technology, however, AI could hold potential risks, therefore to increase the accountability of AI systems, IBM is developing technologies to advance their end-to-end transparency and fairness.

Equipping the workforce with the skills to succeed tomorrow is a challenge we must address today

At IBM, our commitment to building technology that works for everyone is evidenced by the establishment of crucial safeguards and a robust framework of accountability, eliminating the building and deployment of black box AI. We offer open and targeted value-creating AI solutions for businesses and public sector institutions, helping tackle critical challenges. IBM watsonx, a data and AI platform built for business, is the company’s initiative to provide state-of-the-art foundation models to businesses, ensuring governance at every stage of the AI lifecycle, from data input to model development, deployment, and monitoring, thereby enabling the distribution of trustworthy and accountable AI. By unleashing the power of responsible AI for businesses and society, we advocate for governments to implement appropriate regulation, ensuring that AI benefits are maximized while mitigating potential risks and misuse.

It is evident that rapid technological progress has accelerated the adoption of digital technologies across various sectors and has also highlighted the skills gap phenomenon, creating new needs for knowledge and experience and new opportunities for tech companies. Research from IBM’s Institute for Business Value (IBV) finds that executives estimate about 40% of their workforce will need to reskill over the next three years due to AI and automation. Equipping the workforce with the skills to succeed tomorrow is a challenge we must address today. And it is vitally important that everybody is given equal opportunity to participate and thrive. Among our global commitments are the skills development of 30 million people by 2030 and the training of 2,000,000 people in AI technology over the next three years, with a focus on underrepresented groups. Equitable access is a priority for us, and we’re working to ensure that everybody is benefiting from and not being excluded from the latest developments in AI. With our SkillsBuild platform, we provide over 1,000 free training courses in 20 languages to support institutions and businesses in retraining employees and educating minority populations.

As Greek businesses and the public sector embrace digital transformation, they need cutting-edge technologies and partnerships with platform and infrastructure leaders to stay ahead of the curve. With over 85 years of pioneering presence in Greece, IBM is shaping the country’s technological landscape, supporting the digital transformation of Greek organizations and contributing to economic growth through innovation. We combine our deep knowledge of the Greek market with our advanced technology portfolio and consulting expertise to implement innovative solutions that boost efficiency, productivity, and competitiveness across all key sectors of the economy while we also bolster Greece’s ecosystem by investing in talent and education.

Having left the negative effects of the Covid-19 pandemic well behind us and having recorded growth rates of 8.4% in 2021 and 5.6% in 2022, it is now the right time to delve into the issue of what type of growth we should strive for in the years to come. According to my opinion, things in the Greek economy are already moving in the right direction, but it is our duty as financiers and economic leaders not only to identify the new economic trends but also to accelerate Greece’s transition to the new economic paradigm.

Let’s start with an assessment of the current situation. As we speak, in front of our very own eyes, a digital and green revolution is taking place. The digital transformation, especially in the public sector, started slowly but has gained significant momentum over recent years. Digitalization of public records and services is essential not only because it improves the interaction between citizens and the state but also because it allows banks and companies to expand their own digital offerings to clients. On the green front, the amount of investment in renewables has been phenomenal, and it is this flurry of new projects that has allowed the Greek state to upgrade its target for renewable energy production by 2030.

It is now time to delve into the issue of what type of growth we should strive for in the years to come

The possibility of Greece becoming a net energy exporter in the near future was until a few years ago treated as a pipe dream. Now it is a plausible scenario contributing not only towards Europe’s net zero transition but also to Greece’s economic growth. Related to that is the realization that slowly but steadily exports—not only of services such as tourism and shipping but also of manufactured goods—have been increasing both in absolute amounts but also as percentages of GDP for more than a decade and now amount to close to 50% of GDP. Furthermore, the Greek economy has been able to attract record amounts of FDI inflows, directed not only to real estate projects but to a wide range of sectors of economic activity. Finally, we are witnessing the revival of a number of industries that were once prominent but have long been forgotten, the most obvious of all being the Greek shipbuilding and ship repair sector.

All the above provide strong indications that the direction of economic activity is shifting, but this should not lead us to complacency. For Greece to realize its full potential, the new economic paradigm requires substantial amounts of investments in a broad range of sectors. Without any intention of exaggeration, I truly believe that Greece has the potential to become a regional energy hub, data transfer hub, logistics hub, as well as a higher education hub. In some cases, such as the energy and data transfer hubs, substantial investments are required in grid and international interconnections. In other cases, such as education, we need the right changes in the legal/institutional framework to unleash our full potential. Finally, we should not neglect our established sectors such as tourism, agrifood, and pharmaceuticals. There the challenge is to shift from quantity to quality, a shift that will differentiate Greece from the competition and will grant us more pricing power.

Organizations worldwide are constantly challenged to transform to stay afloat. For private and public organizations in Greece, the transformation challenge is far greater, as they are called to cover the lost ground of the previous decade and adapt to a rapidly evolving global business landscape.

Transformation has surely become a buzzword, but what does it really mean? At EY we see transformation as a holistic exercise, that puts people at the center, leverages technology at speed, and fosters innovation at scale. Our experience has shown that companies that follow this approach and harness the power of people, technology, and innovation, are those that transform successfully, accelerate growth, and create new opportunities and exponential value that lasts while sustaining short-term performance.

Placing People at the Center

Talent is the lifeblood of any organization, and its engagement is vital for success. Placing people at the center means understanding their needs, motivations, and aspirations. Employee engagement is not just a feel-good concept; engaged employees prove to be more productive and innovative. Leaders should infuse their organizations with a supportive and inclusive work culture, where employees feel valued and empowered. This includes investing in talent development, ensuring work–life balance, and offering opportunities for career growth.

A comprehensive and strategic approach to transformation will enable Greek organizations to excel 

Clear and transparent communication with our people is crucial in the transformation journey. It’s about involving them in the process, listening to their feedback, and addressing their concerns. By placing people at the center, we ensure that employees are not just bystanders, but active drivers of change.

Leveraging Technology at Speed

Technology is relentlessly advancing, and organizations must keep up to remain competitive. Swift technology deployment involves adopting cutting-edge technologies and digital solutions to streamline operations, enhance efficiency, and deliver superior customer experiences. Agility is a cornerstone of this strategy, quickly adapting to changing circumstances and emerging opportunities. This allows organizations to identify the right technologies, implement them efficiently, and continuously improve upon their infrastructure, while ensuring that they can rapidly respond to market shifts and customer demands. Data, of course, plays a pivotal role here. In the years to come, Greek companies need to harness the power of data through analytics, artificial intelligence, and machine learning to make informed decisions and anticipate future trends, ensuring a competitive edge.

Innovating at Scale

Greek companies are coming to realize that innovation is not a one-time event and isn’t limited to a few isolated initiatives—it must be woven into every aspect of the business: products, services, processes, and business models. It is an ongoing process that drives growth and ensures sustainable business outcomes. Innovating at scale means fostering a culture of innovation and making it an integral part of the organization’s DNA. It means encouraging creativity and problem-solving at all levels, creating an environment where employees can think outside the box, tinker with new ideas, and take calculated risks.

On the road to Greece 2.0, a comprehensive and strategic approach to transformation will enable Greek organizations to excel, decisively compete in the global markets, effectively pursue their sustainability agenda, and drive the country’s economic growth.

In an era defined by artificial intelligence (AI), global interconnectedness, and rapidly changing circumstances, education must evolve, as traditional educational models are no longer sufficient to prepare students for the challenges of a dynamic job market and the proliferation of technologies. Students are required to develop skills beyond the traditional curriculum including AI and media literacy, critical thinking, problemsolving, and the ability to collaborate with different cultures, mindsets, and belief systems. These so called soft skills are anything but soft, as they are essential for thriving in a competitive world while maintaining a balanced and fulfilling life. Such skills include effective communication, emotional intelligence, resilience, and time management. These enable individuals to collaborate successfully, navigate complex social dynamics, and manage their lives effectively.

soft skills are anything but soft—they are essential for thriving in a competitive world while maintaining a balanced and fulfilling life

The rise of AI is transforming industries and job markets. Students must familiarize and equip themselves with the principles of AI and its implications on society as well as on each individual’s life. Learning to harness the power of AI by integrating it into the curriculum can empower students to find creative, ethical solutions to some of society’s most vexing problems, thus contributing greatly to quality of life for all. Additionally, critical thinking and problemsolving skills are essential in an age abounding with complex issues, and media literacy, the ability to critically analyze, interpret, and understand various forms of media, including news, advertisements, and entertainment content, is also necessary. It involves recognizing biases, evaluating credibility, and discerning the purpose and impact of media messages to make informed choices. Education should encourage students to analyze information critically, assess problems, and develop innovative solutions. By fostering these skills, students become adaptable thinkers, ready to tackle unforeseen challenges in the future.

Furthermore, globalization has connected individuals from diverse cultures and belief systems more than ever before. To succeed in this interconnected world, students need to learn how to collaborate with people from different backgrounds. Educational institutions should promote cultural competence and the ability to work effectively within diverse teams, facilitating a deep understanding of varied perspectives. Moreover, the idea of responsible, conscious citizenship goes beyond being aware of civic duties; it means positioning oneself as an active problemsolver in society. This develops psychological muscle, for within society individuals have rights but also responsibilities and becoming positive contributing members adds to a strong psychological immune system.

Education thus, should encourage students to engage with societal issues, advocate for change, and develop the mindsets required to endure and navigate challenges. Students with a strong sense of conscious citizenship will be able to optimally navigate a world full of changes. They will, in fact, be able to drive positive change.

The Greek economy’s growth trajectory is signaling a major shift towards progress and prosperity. The recent restoration of our investment grade, coupled with growth projections exceeding EU averages for 2023 and 2024, signifies a resilient comeback. To achieve sustainable growth beyond mere recovery, there is a pressing need to seize opportunities and address the challenges. This requires innovative responses to the climate crisis, significant investments in technology and education, and continued reforms in the public sector.

Consulting firms are emerging as key enablers for the private and the public sector to navigate four key pillars of transformation: the climate crisis, technology, education, and governance.

Greece’s path to economic renewal stands as a testament to its adaptability and resolve

 

Climate Crisis: Building Resilience

The impact of the recent climate-related disasters highlights the vulnerability of various sectors of our economy to the consequences of climate change. Addressing climate disruption demands transformative changes in forecasting, prevention, and planning. To accomplish this, we need to harness advanced technologies, such as AI, drones, microsatellites, and data analysis to build dynamic predictive models. The agricultural sector should transition to climate-resilient smart-farming practices, while the insurance sector should pioneer innovative coverage models for home, corporate, and livestock. In tourism, the vision should be to create a sustainable model that balances growth, driven by the capacity of the existing and future infrastructure, with environmental responsibility.

Technology: Navigating the Digital Frontier

Underinvestment in technology during the financial crisis has hindered Greek companies’ ability to innovate and compete effectively at the international level. A catch-up exercise is underway: For the public sector, digital transformation serves as a weapon against bureaucracy and an accelerator of reforms, while for the private sector, it serves as a spark for innovation and change. AI’s evolution from an option to a necessity can enhance efficiency, foster innovation, and cement a competitive edge. Greece’s goal should be to equitably harness big data and AI by implementing strict protective measures and promoting technology literacy across every age group, as well as to empower businesses with AI tools and strengthen data security and resilience against cyber threats.

Education: Preparing a Skilled Workforce for Tomorrow

Technological advancements require continuous reskilling and upskilling. The transformation of our education system to meet the future workforce demands becomes imperative. Collaborating with international academic institutions and the business community is key to upgrading Greek universities. Equally important is upskilling the existing workforce, as technological developments disrupt the current business models.

Government 2.0: Reinventing the Public Sector

The pandemic experience has proved a good starting point for introducing technology in government services. The post-pandemic period should be a period of digital revolution in the Greek public sector in general. Despite progress made, there is substantial room for structural reforms. The agenda calls for the clear separation of top-level policymaking from daily front- and back-office operations, the examination of outsourcing solutions, and the promotion of a continuous improvement mindset within the public sector.

Greece’s path to economic renewal stands as a testament to its adaptability and resolve. By skillfully navigating the opportunities and challenges associated with the climate crisis and technological advancement, the country is charting its course towards a prosperous and sustainable future.