Executives grapple with globalisation

By Mark Reynolds

Attempts to discuss the increasing globalisation of business activity and assess its implications for Government policymakers struck an early hurdle at the Apec chief executives' conference.

The problem: defining globalisation.

Jack Smith, the earnest chairman and chief executive of General Motors Corporation, thought he had the answer when he suggested an organisation was global if it held debt or equity in affiliated corporations located in a nation other than its home country.

Based on that view, he believed there was a clear trend towards globalisation of economic governance and regulation, because Governments were competing to offer good business climates to the "global" corporations which were transferring their debt and equity around the world.

While other delegates did not dismiss this definition, they clearly found it limiting.

Phyllis Jones, the president and chief executive of consultancy Elan International, summed up the consensus when she argued that the globe was bigger than debt and equity markets.

"The one-person company can clearly be global now," she said.

"With the use of the internet, you can be doing business internationally anywhere in the world," she said. And it was likely that there would be different Government economic policies in every one of those countries.

The job of the chief executives' summit was to present to Apec leaders a view on the extent to which these separate national rules could help or hinder companies conducting global business in the future.

Mr Smith probably was more in touch with the view of most chief executives when he concluded that Apec's role in this equation would be to ensure that whatever Government policies were implemented, they "did not have a negative impact on other economies."

However, how businesses around the globe would convince individual Governments to be so selfless was left for another day.

After all, the businesses themselves are still grappling with the question of whether the expanded "global" word should be spelt with an "s" or a "z."