Executive Summary

Executive Summary

On the occasion of its 25th anniversary, Kearney’s Global Business Policy Council gathered more than 60 CEOs and renowned thought leaders from around the world in Taormina, Italy for its annual CEO Retreat. Participants discussed the future of capitalism, democracy, and the global economy as well as the outlook for three breakthrough technologies. Following are the key takeaways:

Globalization is not dead, but it is under significant pressure. The world has moved from an international environment of trust, confidence, and integration to one of distrust, disaffection, and challenge to democracy, capitalism, and global integration. Strong, more equitably distributed growth is the surest course to arresting nationalist populism and restoring international cooperation.
China’s economy is likely to look more like Germany’s than America’s in 10 years. China will continue to be an export-led economy with high levels of savings. The good news in the short term: there will be no serious Chinese debt crisis because the current credit bubble can be addressed effectively.
India is set for growth above 7 percent in coming years. This growth is based on its technology-enabled reform programs, from the universal ID to the nationwide goods and services tax. However, the country faces significant challenges in providing jobs and growing the skills of its labor force.
The mystery of missing productivity remains unsolved. There is a strong sense that economics does not adequately measure the new innovation economy, but there is also evidence that companies across sectors might be ready to make long-forestalled capital investment in new technologies to unlock productivity and growth.
The “economic singularity” may be near. In relatively short order, artificial intelligence (AI) will eliminate a host of human jobs, from driving delivery trucks to further deciphering the function of human genes. Labor markets must prepare for a massive transformation— showing constant agility and preparing workers for jobs requirements we cannot yet imagine.
Virtual reality (VR) is on the cusp of commercial takeoff. Augmented reality (AR) is close behind. Businesses across multiple sectors can capitalize on these technologies immediately, from employee training to design work and convergence with other technologies to yield new capabilities and efficiencies.
Human beings now have the power to control their own evolution. The recent breakthrough in biotechnology—CRISPR-Cas9—has spread to every area of biological research and is enabling scientists to fast-forward their work in genetic manipulation. It is a technology with infinite promise—and equally profound possibilities for abuse.

Introduction

Kearney’s Global Business Policy Council convened its annual CEO Retreat in the city of Taormina on the island of Sicily, Italy on June 29–July 1, 2017. This Retreat, in the 25th anniversary year of Kearney’s Global Business Policy Council, brought together more than 60 CEOs and renowned thought leaders to consider the current state and future trajectory of politics, economics, technology, and society. Taormina, founded in 392 BC by the ancient Greeks, was an auspicious location for this gathering. Many of our deliberations echoed themes from the keen observations and insights of those same ancient Greeks, and the active volcano on the island was an unremitting reminder that only change is permanent.

Indeed, since the city’s founding, change and volatility have been facts of daily life for its denizens. Taormina is perched on Mount Tauro, looking out over the Ionian Sea. Looming on the inland horizon is the massive silhouette of Mount Etna, an active volcano that is the source of the fertile land that gives the region its name, “the lemon coast.” The uncertainty represented by Etna, the “eternal mountain,” is amplified by the cultural mosaic of Taormina’s architecture, reflecting the waves of successive civilizations that conquered the island over several millennia. The ancient amphitheater of the Greeks remains an icon of the city, alongside the designs of the Romans, Byzantines, Arabs, Normans, Swabians, French, Spanish, and modern Italians.

It is no surprise that Italy’s government chose the treasured city of Taormina as the venue for the G7 summit just a month prior to our Retreat. The G7 leaders, including Italian host Prime Minister Paolo Gentiloni and the heads of government of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, gathered to address a world that was at once both stable and unpredictable, both prosperous and economically embattled, and both cohesive and centrifugal. Moreover, the G7 leaders struggled with profound challenges amid areas of existing cooperation—from alliance relationships to trade agreements to shared approaches to global warming.

This year’s CEO Retreat picked up where the G7 left off, focusing on the theme, “Stability and Prosperity at Risk: Prospects for Global Business.” Council Founder and Chairman Paul Laudicina opened discussions with the observation that over the quarter-century history of the Council, the world has moved from an international environment of trust, confidence, and integration to one of distrust, disaffection, and challenge to democracy, capitalism, and globalization. He urged those at the gathering not only to identify macro challenges and opportunities, but also to suggest concrete strategies and actions to address them. Participants accepted the charge, tackling a daunting set of questions over two days of intense discussion:

What is the future of the philosophical and organizational foundation of our world order: free market capitalism and democracy?
What is the state of globalization? Of major developed and emerging markets?
Can we reverse institutional decay, regain public trust, and agree on a unifying international order? Or have we entered an era that is beyond governance?
Can stability and prosperity be maintained?
And what is the proper role of business amid this turmoil?

As is Council custom, all discussions were held under the Chatham House Rule of non-attribution. This summary offers a mere sketch of the extensive knowledge, insight, and spirit that were expressed during the 2017 CEO Retreat.

Doing Business in a Populist World

Your industry

Your needs

About us

Careers

Insights

Your industry

About us

Careers

Insights