POLICY BRIEF #5: Directing business policies. The challenges to Industry 5.0. Karolien Lenaerts, Steven Dhondt, Peter Totterdill, Peter Oeij (October 2023).

DRAFT

In recent years, the EU has embraced Industry 5.0 as a key paradigm in its industrial policy. Whereas Industry 4.0 was primarily driven by productivity and technological considerations, in the last decade it has been clearly demonstrated that a wider perspective is necessary in order to make the digital transformation work. Industry 5.0 brings such a perspective by adding sustainability, resilience, and human-centricity into the mix. Compared to Industry 4.0, the transition towards Industry 5.0 is policy- and values-driven. In short, Industry 5.0 will need to be a strategic choice for companies, one in which boards and senior teams align organisational values, purpose, strategy, structures and culture with the goals of human-centricity, sustainability and resilience. The task for policymakers is to create the incentives, resources and regulatory context within which the right strategic choices can be made.