Perhaps the single biggest distortion to the free enterprise system is when a number of private institutions are deemed by political and regulatory authorities as too systemic to fail. Resources are trapped in corporate structures that have repeatedly proven their incompetence, and further resources are sucked in from the taxpayer as these institutions destroy value. Indeed, these institutions can play a game of chicken with the authorities by refusing to take adequate precautions against failure, such as raising equity; confident in the knowledge the authorities will come to the rescue when needed.
European Jobs in 2040: Thinking ahead in the Netherlands
By George M M Gelauff, Bas ter Weel and Albert van der Horst
How will we earn our money in 2040? This article develops four scenarios for how the Dutch economy may evolve. It argues that the future depends on the development of technology – the fundamental driver of future economic development. Many of the lessons and analysis apply equally to the rest of Europe.
The UK Bribery Act and Beyond – Preparing for Change
By Michael W. Johnson
This article will detail the most important elements of the law, highlighting the restrictions that are broader than previous anti-corruption laws, such as the US Foreign Corrupt Practices Act (“FCPA”). It will then discuss the steps companies should take to ensure that they have “adequate procedures” in place to prevent prosecution under the law.
Islamic Finance: Is the Time Ripe for a Private Sector Trade Association?
The growing significance of Islamic finance has brought into sharp focus the similarities and the potential for convergence with respect to market practices between conventional modes of financing and the market for Shariah-compliant instruments. Can the market for Islamic Finance and instruments maintain its momentum without emulating the more standardised approach associated with the conventional market? But might that convergence do violence to some of the fundamental principles of Islamic finance?
Luxury consumer behaviour in Mainland China: What exists behind the facade of new wealth?
China recently became the world’s second largest market for luxury goods with an annual increase of more than 30% in 2010, even surpassing Japan. Further estimates predict that China will become the largest upscale product and consumer goods market in the world. How does a country with an average GDP per capita of $3,800 USD, and classified behind 105 in the world ranking possess such a strong propensity for consuming luxury goods and products? Specifically, how does one make sense of Mainland Chinese luxury buyers and their respective consumer behaviour? This article answers these strategic questions for foreign companies and marketers who are interested in the luxury industry in China, and for those who want to develop a greater understanding of one of the world’s largest market and its 1.3 billion consumers.
Selling to the Poor
The poor, of course, have many unmet needs. It would be wonderful if business could satisfy all (or even most of) these needs and make a profit in the bargain. It would be a painless, even a profitable, way to solve the problem of poverty. That is the seductive appeal of the ‘bottom of the pyramid’ proposition popularized by C.K. Prahalad in his book The Fortune at the Bottom of the Pyramid. Unfortunately, this solution does not work. The consulting firm Monitor Group concluded, after an extensive survey, that there are very few examples of profitable businesses that market truly beneficial goods in low-income markets and operate at a large scale. The problem is that the market for selling to the poor is just too small, and the poor have very little purchasing power, which makes the market not all that attractive for companies.
Entrepreneurship in China
By most accounts, China is one of the most entrepreneurial countries on earth. According to the widely cited Global Entrepreneurship Monitor (GEM), published by Babson College, on a range of dimensions, such as fear of failures and entrepreneurial intentions, China ranks quite favorably among the group of nations surveyed by the GEM. China is not yet an innovative economy, in the opinion of GEM researchers, but it is an efficiency-driven economy that is a cut above factor-driven economies that are a norm among developing countries.
China in Africa: Think again
You think you know what China is doing in Africa. You’ve seen the headlines: the Chinese arrived in Africa a few years ago in a desperate search for oil. They set up a huge aid program targeting resource-rich, pariah states that would otherwise have to heed western concerns about governance. Their companies bring in all their own workers. It’s a great story. There’s just one problem: almost none of it is true.
Beyond Rising Sea Levels: Using the Insurance Asset to Manage Risk and Maximize Opportunity in the “Green” Economic Paradigm Shift
The green paradigm shift:
Climate change is causing much more than just rising sea levels. Climate change is changing the way we power a society that depends more heavily on power everyday; the way we transport ourselves; how we evaluate where we live and work; the way we interact with the environment; and the risk to which we are exposed in both our personal lives and in our businesses1. In other words, climate change is causing an inexorable change in the way we live, work and play by adding a new dimension of risk to our already complex environment. We need to re-think the ways we manage risk and leverage our assets to respond to these changes – including insurance.
Tax Havens, the Crisis of 2007 and Financial Regulations
By Ronen Palan
Tax havens have existed since early twentieth century, and are used primarily, but not exclusively, for tax evasion and avoidance. Tax havens are used, however, for other purposes as well. Since the early 1960s, all the premier tax havens of the world have developed financial centres known otherwise as Offshore Financial Centres (OFCs). It is estimated that about a quarter of all international lending and deposits originate in these OFCs. The Bank of International Settlements (BIS) statistics of international assets and liabilities ranks the Cayman Islands as the fourth largest international financial centre in the world, while other well- known tax havens/OFCs such as Switzerland (7th), the Netherlands (8th), Ireland (9th), Singapore (10th), Luxembourg (11th), Bahamas (15th) and Jersey (19th).
EDITOR'S PICK OF THE WEEK
The Performance and Transformation Orchestrator: The CFO’s New Mandate in the Age of AI
By Terence Tse
CFOs are evolving into AI-driven transformation orchestrators, balancing finance, technology, and strategy while upskilling teams, managing risks, and driving measurable business value.
A key insight from this year’s AI for CFOs event, organized...
