Plenary Session – The Global Economy and Corporate Strategy

Geopolitical pressure and macroeconomic risk are center stage at many corporations, but boards often lack access to the expertise necessary to assess these risks. Interest rates remain stubbornly high, with significant implications for capital formation. China’s domestic economic crisis threatens the global economy in a manner that many analysts fail to appreciate. Meanwhile, the U.S. and Chinese economies are decoupling in a manner that creates significant opportunities and tensions on both sides of the Pacific. In the United States, growing unionization, combined with labor market stress and protectionist initiatives, generates a new form of de facto industrial policy that complicates the traditional corporate strategy calculus. Banks have yet to recognize embedded losses in U.S. commercial real estate, which creates the potential for a new wave of bank failure risk. Populations are also aging in a manner that creates significant demographic stress that most governments and corporations have yet to address. Uncertainties associated with the U.S. presidential election make it difficult to project long-term tax and macroeconomic policy. Tensions over the Middle East, Ukraine, and Taiwan complicate the calculus even further. The vast majority of corporations lack the resources necessary to analyze the implications of these larger political and economic forces for their corporate strategy. This panel will provide insight into the implications of selected geopolitical and macroeconomic trends for corporate strategy and governance.