There is an urgent need to move away from the dollar as the world's reserve currency, in light of the financial meltdown marked by banking abuse and the ballooning US deficit, the 2012 Global Ethics Forum in Geneva has urged.
"Ethics in finance based on sustainability and justice needs a new reserve currency system," said Christoph Stückelberger, Executive Director and Founder of Globethics.net, a global network that promotes dialogue and research on ethics and values, and the organizer of the 28-30 June Forum.
"A global balanced reserve currency system must reflect the multipolar world and cannot be based on one national currency," said Stückelberger, a professor of ethics.
Experts on finance and business ethics attending the Forum warned of the consequences of maintaining the US dollar as the world reserve currency.
"Paradoxically, the US dollar's status as world reserve currency has exacerbated the US drift towards economic dysfunction," said Thomas A. Myers, a certified US public accountant, and banking expert who is a specialist on securities fraud.
"The essential premise that the US dollar should remain as world reserve currency may no longer be called for," he told 250 international experts, business leaders, and academics attending the 28-30 June gathering.
The global monetary system is "in dire need of reform", Myers said. Any such reform of the global reserve currency system, "must better meet the needs of developed and developing countries in order to bestow the maximum benefits of all citizens of the world".
Myers, who prefers the title "forensic accountant", has testified before the US Congress on banking matters and has provided training to the major banking regulatory agencies, the FBI, the Securities and Exchange Commission, and the Board of Governors of the Federal Reserve.
Any currency reform, Myers underlined, needs to be aimed at an economic system that facilitates sustainable and equitable growth through environmentally friendly approaches.
Such a reform, he said, must also be one that "promotes social responsibility and that meets squarely the challenges of global poverty, responsible use of natural resources, and the elimination of the social and economic unrest that leads to conflict".
In a similar vein, Luc Guillory, president of Share France, said the world needs a new international currency, but stressed "it has to reflect something different - equity, justice in the world, and be based on multilateralism".
Experts said the current role of the dollar as the global reserve currency is not helpful to sustainable development, and also indicated it is likely to change in the next five years, thereby leading to significant changes in international trade, aid, politics, and culture.
Therefore, greater ethical leadership to encourage a positive transition is required, said Jem Bendell, a professor of sustainable management, and director and director of Lifeworth Consulting, presenting recommendations from a workshop on the issue.
There needs to be greater clarity about the purpose currency systems should serve, he said.
The workshop urged "research and dialogue on first principles and exploring what currency systems at local, national, regional and global level can enable sustainable development".
"There could be a key role for Globethics.net to host that discussion," said Bendell.
Myret Zaki, deputy editor of the Swiss Magazine "Bilan", and author of the bestseller, "The end of the Dollar", pointed out that world trade is already changing the rules of the game "de-facto".
Such changes are taking place, she said, even though the International Monetary Fund and the G20 group of leading economies have not managed to come up with any serious proposals about the future shape of the world's reserve currency systems.
Both Zaki and Chong Zhang, director of Generis Capital in China, believed that the world would increasingly move towards a multi-currency global reserve system.
However, Zaki did not rule out another global financial crisis in the event of the dollar's reserve status being sharply eroded.
Globethics.net is a global online network of about 60'000 individuals, and of institutions from all sectors of society, with participants from more than 200 countries. It has a special focus on business ethics, responsible leadership and interreligious ethics. More information: www.globethics.net