World Economic Forum 2017 – Trump, Brexit, diversity and taking responsibility

Procter & Gamble’s (P&G) chief executive David Taylor said that big businesses have been witness to one of the biggest backlashes from society and as such they simply can’t afford to wait any longer to engage with what’s going on around them.

“Whether it’s the voice we have in advertising or empowering employees to spend time in their own communities it’s a choice of now or waiting. And I don’t think we can afford to wait. We’ve seen a societal backlash to big business and we can accept the challenge of growing the brand but in a way that engages society,” he said.

During Davos, P&G announced the production of a shampoo bottle made from up to 25% recycled plastic collected from beaches. The FMCG business pledged to use up to 25% post-consumer recycled plastic in around half a billion bottles across its Pantene and Head & Shoulders ranges by the end of 2018.

Meanwhile, financial firm EY’s chief executive said that it’s all well and good making speeches but at the end of the day real change is only going to happen if there is buy in across the business, and that means from the board and other shareholders. And to do that, quite simply, you have to have a way to measure it.

“We need to have a global index that measures something other than [quarterly] numbers,” he urged.

“To be successful businesses have a huge role to play. Government is lacking in many ways and businesses can step in. Increasingly, we’re looking at how as an organisation we can contribute beyond stakeholders and into the wider society.”

Diversity

Almost 80% of the 3,000 delegates at WEF being men and so, perhaps unsurprisingly, diversity was a much-discussed out issue.

Unilever used a panel session to urge business leaders to recognise that stereotypes, social norms and unconscious bias are contributing to the ever-widening gender gap, referencing its own research which found that 60% of women and 49% of men are personally impacted by stereotyping in their careers and/or personal lives.

Commenting on Unilever’s research, Facebook’s chief operating officer Sheryl Sandberg singled out stereotypes at the crux of the gender gap, and consequently advertising’s role in inflating those skewed views. “I don’t think its possible to overstate how important stereotypes are,” she said.

Elsewhere, MasterCard chief executive Ajay Banga added to the debate by saying that business success is not just rooted in diversity of gender, race, ethnicity or orientation.

"Real diversity is diversity of background and experience. If you come from the same backgrounds you’ll have the same blind spots and miss the same trends,” he said.

Political upheaval

But all of this was underpinned by the global uncertainty prevailing thanks to Brexit and Donald Trump’s looming inauguration.

British Prime Minister Theresa May’s much anticipated speech on Brexit detailed that Britain "open for business" despite confirming an exit from the EU single market.

WPP boss Sir Martin Sorrell said he was “extremely worried about whether we’re going to maintain a really strong position in Europe” and admitted that the advertising group’s revenue growth had slowed as a result of the opaque plans.

“No Brexit would have been the right thing for WPP,” he said.

But on Trump, Sorrell was more optimistic. “[He] will be good for the US economy. Infrastructure spending, reduction of tax, pulling back money from overseas.”

“When you looked chief executives in the eye before the election and said: ‘Do you believe that Hillary will be more effective for your business?’, I think in their heart of hearts they said, no, they would prefer Trump.”

There are some business leaders so worried about the times ahead that they are prepared to do anything to prevent more upheaval. Alibaba’s chairman Jack Ma is one such leader, with the Chinese businessman claiming he would do everything in his power to stop a trade war breaking out between China and America in the wake of president Trump’s economic nationalist stance.

“I think that China and the US should never have a trade war, will never have a trade war and I think we should give president-elect Donald Trump some time – he’s open-minded,” said Ma, referring to his meeting with the billionaire earlier this month.

The fallout from a trade war between the world’s largest and second-largest economies would be so severe that Ma claimed he would even sacrifice his own company to prevent such a situation.

Trump has vowed to slap strict tariffs on countries like China and Mexico that he believes have benefited at the expense of his own country after it exported much of its manufacturing trade over the last 30 yearsfrom globalisation. He has pressured US companies to keep and create jobs in the country, while rebuking those American businesses that set up abroad, going so far as to threaten import tariffs, a move that could ruffle other countries to retaliate with sanctions of their own, sparking a global trade war.