What is your outlook for the global economy in 20111?
As we look to 2011, it’s important to consider the pace of change we’re
experiencing. It’s not just business, society
is transforming as well. And this presents us with a tremendous
challenge in getting global growth going again, emerging market economies,
particularly in Asia and also in Latin America, have been leading the recovery
and has been a very positive effect around the world.
From the west the recovery has been slow.
Unemployment is a serious issue in countries that struggle to spur growth
while addressing serious debt and other fiscal issues.
Overall, I'm optimistic that the recovery will continue but it seems
likely that global growth will be sluggish over the next year and there
will be some bumps along the way. For businesses, rebuilding confidence
is critical.
Businesses need to have the confidence to change their focus from cost cutting to
developing a new strategy for long term sustainable growth for the environment
that we’re in.
I'm optimistic as we see our clients take on this challenge and put forth
their plans for 2011 and beyond.
The world 2011 is exceedingly complex, interconnected, and unpredictable.
How can organizations develop a resilience in this new world of risk?
We find that companies are increasing their resiliency to risk in several ways.
First, they're building a long term vision for their business.
They're taking into account risk as well as opportunities.
Companies know that they can't be reactive.
The world is too complex. Change occurs too rapidly.
Secondly, they're making risk management a strategic part of their entire
organization, part of their DNA.
They recognize that a single individual or group cannot manage all the economic,
social, and operational risk facing a business today.
We’re also seeing a greater focus on risk management at all levels of the
organization, including the board and senior management as well as middle
management; building resiliency to risk means setting the tone at the top
and throughout the entire organization.
As global growth shifts to the developing world, what should be the role of
business in developing countries?
The role of business in a developing begins with recognizing the
interdependence among businesses, government, society, and the global
economy as a whole.
Businesses in developing as well as developed countries need to be active
and engage corporate citizens, thinking about all their stakeholders as well as the
environment in which they operate in.
Effective governance is also critically important for businesses in order to
build trust and confidence in developing economies.
Businesses should adopt models that create transparency, accountability,
and compliance.
As a foundation is needed to have strong embedded values that are actively
advocated and applied throughout the organization and not just as stated in words.
What would you consider the most important norms an increasingly
interdependent yet diverse world needs to share?
Certainly from a business perspective, responsible business practices that
contribute to sustainable markets and help build trust are the heart of good
corporate citizenship and important norms we all must share but we also know that
good governance, compliance, and ethical behavior while important aren't enough to
address the challenges we face in the world today.
So it’s important that our shared norms include tackling depressing social,
global, and environmental issues we all face.
This means continuing to increase the focus on sustainability and climate
change. It means working to eradicate extreme
poverty and hunger throughout the world. It’s an imperative that we use our
global resources and technology to address this issue.
Another norm that’s essential for securing the strength of any society
is investing in education and that includes providing equal opportunity for education
regardless of gender. We also have to embrace talent wherever
it might be. The best talent can be found in every
corner of the world so one of the norms we need to allow is for talent to be able
to be moved freely from one location to another in a way that respects the skills
regardless of geography of the individual.
How can companies turn sustainability into a competitive advantage?
In today’s world, businesses know they need to respond to sustainability issues
and increasingly businesses are moving away from a view of sustainability just
as compliance or reporting exercise.
And they see it as opportunity where they can gain a competitive advantage.
In fact, in a recent survey we conducted, business leaders told us
they're leveraging their sustainability efforts across their entire business.
They're finding opportunities to create long term value for their businesses,
including significantly reducing energy costs, more efficient use of resources
particularly water, and improving relationships with their customers
and suppliers. Some companies have found that a focus on
sustainability has stimulated innovation into new products and opening new markets
for the businesses across the world.