The global economic crisis has fundamentally changed capitalism and the way governments and business view the world, a report released in Dubai on Tuesday has said.
The Economist Intelligence Unit survey, commissioned by Dubai Holding, found that almost 60 per cent respondents believe that capitalism is entering a new era of lower risk tolerance, higher regulation and slower growth.
The report, 'Risk and Regulation: A New Era for Capitalism', is based on the findings of a survey of 418 global senior executives.
Respondents said that their long-held faith in free markets is at an end. Nearly 60 per cent of senior business executives surveyed agreed that "the current crisis has fundamentally changed capitalism".
Moreover, 46 percent believe that when the upturn arrives there is unlikely to be a return to the finance driven economy of the past, with easy credit fuelling investment and asset prices.
Today, regulation is no longer seen as counter-productive meddling in otherwise perfect markets, but a prerequisite for a functioning global economy.
Yet almost two-thirds (65 per cent) of executives agree with the statement: "I am in favour of further bank regulation, even if the result is slower economic growth."
Power centres are set to shift as well, with some stakeholders exerting more pressure than others. At the top of the influence list are regulators, customers and creditors.
In contrast, employees, non-governmental organisations and trade unions will be left out in the cold, with large majorities believing their influence will wane or stay the same.
"This report is an important contribution to the debate about the lessons to be learned from the global economic crisis. Although we are still in the midst of the economic fallout, now is the time to question many of the assumptions that have underpinned the global financial system and grasp the opportunity to change things for the better," said Ahmad bin Byat, the chief executive officer of Dubai Holding.