What is your outlook for the global economy in 2011?
I think in 2011 we're going to continue to see the recovery we saw in 2010, albeit at
different paces around the world.
I don't know who it was that coined the term "LUV recovery,"
not L-O-V-E but L-U-V, that's what were going to keep seeing:
L-shaped in most of Western Europe, U-shaped in North America, and V-shaped in
all the emerging markets.
That's what we saw in 2010, I think that's what we'll continue to see in 2011.
I do hope, in addition to that recovery, we see a couple of other things in 2011.
One would be a continued coordination of countries and governments and institutions
around the world on issues on open trade, issues of regulation, issues that will
keep the economy growing. I also think it's incredibly important
that we see entrepreneurs get back in the game.
They mean so much to job growth and economic activity.
They have to be fully engaged and I think they will be.
The world in 2011 is exceedingly complex, interconnected and predictable.
How can organizations develop resilience in this new world of risk?
You know the world is very, very connected and very complex but I don't think the
word is "resilience." I think we need to see companies
demonstrate agility. At the end of the day, I think they win
by looking externally at the world around them, at the market as it exists,
seeing the needs that are out there and then having the vision internally to develop
products or solutions or ideas to meet the need.
They didn't have to have great courage to take risks, they need to be persistent to
pick themselves up, dress themselves off if things don't go well.
At the end of the day, companies need to act very entrepreneurial, that's what the
entrepreneurs in the world do everyday. And so I think as we look to 2011,
even large companies need to develop their entrepreneurial spirit to internalize that
to become very much entrepreneurial.
as global growth shifts to the developing world, what should be the role of business
in developing countries?
I think businesses have a responsibility to drive both growth and return for their
stakeholders but I think more broadly businesses everywhere have
a responsibility to help drive positive societal change.
I think that's incredibly important in the emerging markets.
I think in the emerging markets, companies can do a great job of helping
build a strong middle class.
I think businesses can do an amazing job in helping drive the economic empowerment
of women. I think companies in emerging markets
have a real responsibility to help drive out corruption and to really help take
what is now in many cases un underground economy and bring it up above the surface.
I think these are responsibilities that are incredibly important in the entire
world but especially in the emerging markets.
What would you consider the most important norms that an increasingly interdependent
yet diverse world needs to share?
This world we live in is very interdependent and very diverse and so I
think it's vitally important that we have some norms that bring us together.
I think the first one is to have a true deep respect for differences of all types:
gender, ethnicity, religious differences, differences in sexual orientation,
whatever. That's the first norm I really see as
being vital. I think second we need to have a real
global norm around corporate governance around investor rights, around support for
the rule of law. I think the third thing that I see is an
incredibly important need - as an accountant you'd expect me to say this -
to have a single set of high quality accounting standards and auditing
standards so that investors around the world can better understand what companies
are reporting to them.
How can companies turn sustainability into a competitive advantage?
I think a lot of companies are trying to answer that question today, how they can
make sustainability a long term competitive advantage for themselves.
I think at the end of the day, though, we need to have a world in which real focus
on the environment, real focus on minimizing one's footprint is important
for every business and every individual, and in fact it's not an advantage for
a few who are doing things well but it becomes a disadvantage for any business
that isn't committed to minimizing its footprint.
Companies that are not doing the right thing will increasingly be ostracized.
Having said that, I do see a future where costs that are today externalized
and borne by society will increasingly be internalized and the cost of any company's
actions will be reflected in their accounts in some fashion or another.
I think that will provide long term cost advantage to businesses that are actually
having the most efficient operations in minimizing their footprint.