Globalisation, a common project that the whole world once embraced is being rolled back, largely because of geopolitical change... We are moving into a world where political situations are making people think very differently about the way the global economy is structured.”
We are in a regime change right now and that means we will see a different interest rate structure and a different interplay between inflation and growth in most major economies. The world is now prioritising resilience over efficiency – for governments that means prioritising climate, defence, health and food security, and for companies, it’s a move from just in time to just in case supply chains. Overall, it’s more costly environment.”
Public markets have failed to create long-term sustainable innovation in software companies – they have produced unprofitable businesses and boom and bust cycles. Private equity has the opportunity to enter enterprise software en masse but investors have to recognise that this is no longer an industry – it’s driving transformation across sectors. Executives at even the most advanced companies say they are only around 50% of the way through re-engineering and digitising workflows. Yet that is misleading because the digital revolution involves the exchange of ideas and finding new ways of doing things. It’s a continuous process that has no endpoint. Our ideas of what is possible today with software are changing all the time.”
ESG now makes a difference to financial returns: it is no longer a compliance item, it has become a competitive tool. We have arranged US$20bn of ESG-linked financings, saving $20m of interest payments, so the financial benefits are real. But ESG has to be embedded in your culture. My dream is for there no longer to be a need for an ESG department because it has become so ingrained.”
