 to this interesting issue. In the context of an industry strategy meeting, we're going to be talking about geopolitics and foreign policy and the like. On my left is Shirley Ann Jackson, who's president of Rensselaer Polytechnic Institute. She has a long career in multiple domains of society in respect of business, technology, international affairs, and the like. She was chair of the US Nuclear Regulatory Commission. She was co-chair of the US President's Intelligence Advisory Board. She's been with the US Department of State's International Security Advisory Board, and she sits on a range of boards of major corporations. And she's been no less important from our particular perspective, a co-chair of one of our global future councils, this one on international security and the Fourth Industrial Revolution. In addition, next to her, we've got Antoine Noguier, who's a senior vice president head of strategy for Airbus Defense and Space. He is based out of Germany, I understand. Previously and for many years, he worked within the French military in the Air Force. He's an experienced fighter pilot with over 3,200 flight hours in combat aircraft. And he worked in NATO in a range of capacities and also served as the military air advisor to more than one French president over the years. And then further, we're joined by Mary Klein, who is adding to the disciplinary diversity of this panel. She is a senior PhD political scientist with more than 20 years of experience in public, private, and academic sectors. She specializes in foreign affairs. She has had appointments at RAND, the State Department, worked for quite some time at the Eurasia group, as I understand, and is now senior policy advisor in the Office of the Chairman at EY. What I'd simply like to do is make a comment or two about why we've decided to put a session on geopolitics and foreign policy in an industry strategy meeting. And then we're going to invite Dr. Jackson to set the context more generally for the discussion by offering some extended remarks and a presentation. Let me just say that each year for many years now, we've been putting out, as a setup for our annual meeting in Davos, something called the Global Risk Report. And we monitor over time what how risks are perceived and how the prioritization of those perception of risk varies over time. And what has been striking in the last couple of years is how geopolitical risk has risen really to the top of the attention of our sample community who respond to the survey of business executives and experts from around the world in multiple industry sectors and also at disciplines. Moreover, it's clear just by reading the newspaper, of course, that we are now in a much more multi-polar and multi-dimensional international community. And this is, for many multinational companies, demanding an initial degree of attention on how to assess and understand what is happening on the political domain, but also how to engage. Some people have called this term this corporate diplomacy. That might be a bit of a strong term in this regard. But it is about not only assessing and understanding, but also engaging. Whether we're looking at the trade frictions right now, investment regulations, political volatility and shifts in various countries and regions, the demands of society shifting in relation to corporations' role in society domestically, but also internationally, the sustainable development goal, the 2030 agenda, the Paris Agreement, and the like. However, you want to slice the story here, there is a range of growing issues of that demand attention from all actors of society, but not least companies who operate across borders. So today, we've come together and are posing the question in such an increasingly multi-polar and multi-conceptual world order, how can companies increase their foreign policy aptitude and resilience to geopolitical shocks? We're going to get into that specific discussion because we have some practitioners here. But before we do so, Dr. Jackson, can I invite you to the podium and set the table for this discussion, if you will. Thank you, Richard. For the past two years, I have served as co-chair of the World Economic Forum's Global Future Council on International Security, where we've been considering how the force is unleashed by the fourth industrial revolution in which the digital, the physical, and biological worlds emerging will rewrite geopolitical maps in the near future. I also served from 2014 through January of 2017 as co-chair of the President's Intelligence Advisory Board for President Obama. So through those two lenses, I'm delighted to give you an overview of some of the factors discussed, particularly in our council, likely to shape prosperity and power in 2030. To begin, the era following the Cold War in which the U.S. led the international order clearly is changing. Russia and China are exerting regional power, and by 2030, there will be a new degree of economic power in emerging economies, including Nigeria, Iran, Egypt, Indonesia, Mexico, and Turkey. Now, the speed at which they are emerging is unprecedented, and globally, over 2 billion more people will enter the middle class by 2030. But it is not merely GDP that determines geopolitical power. Other factors include first access to and control of key strategic resources, especially energy-related ones. Second, the ability to adapt to climate change. Third, human capital and changing demographics. And fourth, the influence of rapidly advancing fourth industrial revolution technologies. By 2030, the changes wrought by these factors and how they intertwine will create intersecting vulnerabilities with potential cascading consequences for all sectors, as well as significant opportunities for businesses. Let us begin with energy. There is no development without it, which today remains very linked to fossil fuels, and countries derive power from that. Oil and natural gas also create complex trading relationships, both within and in defiance of regional boundaries. Russia is rich in natural gas and oil, and has used these riches to geopolitical advantage for example, in Ukraine and the EU. But we are moving to a lower carbon world, driven by climate change, steep cost reductions in and access to renewable energy, as well as by purely geopolitical concerns, such as a desire to loosen one country's grip on another. As Russia becomes more aggressive toward the West, including reportedly interfering in democratic elections in the US and Europe, other sources of energy, in fact, offer Europe the prospect of cutting its imports of gas and oil from Russia. Around the world, in fact, more energy will be produced locally, including off-grid renewable energy that will bring power to those who do not yet have access. Let us look more closely, however, at China. The International Energy Agency expects global renewable energy capacity to expand by 43% between 2017 and 2022, driven by upward revisions of solar capacity in China and India. China alone will be responsible for 40% of global renewable capacity growth. China's 13th five-year plan, ratified by the National People's Congress in 2016, positions the nation for even greater power in a lower carbon world. Its key themes include a focus on innovation to stir growth, ensuring that this growth is green and sustainable, and broaden trade relationships and pathways represented by its Belt and Road Initiative to help create the infrastructure for an overland trade route to Europe through Iran, already a key trading partner for oil, and a maritime silk road, and a structure that extends through South Asia. The Belt and Road Program encompasses 65 countries, representing 30% of global GDP and 75% of known energy reserves. This represents a continuation of China's longstanding policy of trading or developing infrastructure for access to key markets and resources. In a lower carbon world, however, the most critical strategic resources will begin to shift. There will be a materials-based revolution with new struggles for access to and control of non-fuel mineral resources. This will both expose and create new resource-related interdependencies. For example, this US Geological Survey Map suggests the degree to which the US is dependent on China for mineral commodities that are essential in technology, security, and energy. As the transportation sector moves toward electrification, critical resources include key materials for lithium-ion batteries. And currently, lithium production or reserves are concentrated. They're concentrated in a few nations. And as much as 51% of identified lithium resources globally are in the so-called lithium triangle of Chile, Argentina, and Bolivia. Now, cobalt is used primarily in the battery industry, specifically in the cathode component of battery. In fact, the battery industry uses 42% of global cobalt production. Hence, no cobalt, no Tesla, as one article recently said. Now, most of the remaining cobalt produced is used in industrial and military applications, such as alloys for jet engines and gas turbines, magnetic steels, and some stainless steel. 58% of cobalt is mined in the conflict-written Democratic Republic of the Congo. Graphite has numerous uses, including in electronic materials. It also is used for energy storage. 67% of the world's graphite is produced in China. So there are potentially catastrophic price shocks and security risks if the supply chains for these materials are disrupted, absent diversification or development of substitute materials through R&D. Climate change will bring its own risks. While the risk to Africa include threats to rain-fed agriculture due to drought, both India and China have low elevation coastal cities, vulnerable to sea level rises and storm surges, including Guangzhou and Shenzhen in China and Mumbai and Kolkata in India. In the US, an analysis by the Union of Concerned Scientists founded by 2035 in two of its emission scenarios, 170 coastal communities in the US are likely to face chronic flooding. At the same time, certain regions, California included, face increased drought risks. The potential for intersecting vulnerabilities with cascading consequences is high. Is climate change going to drive migrations beyond recent refugee crises? Encourage the spread of infectious diseases? Increase dissatisfaction with governments in vulnerable regions such as South Africa and South Asia? And encourage instability? Disrupt global supply chains? Alter access to key resources? The answers to these questions easily can be, and in some cases already are, yes. Speaking of resource access, shrinking ice cover in the Arctic Circle is opening now new resources and trade routes, including an estimated 30% of undiscovered conventional natural gas reserves and 13% of undiscovered conventional oil reserves. Now, control of these resources and routes likely will be a source of geopolitical tensions among the US, Russia, Canada, Norway, and other nations. As you clearly understand here as part of Silicon Valley, a key component of geopolitical power is human resources. The world population will grow from 7.6 billion to 8.6 billion by 2030. India soon will overtake China as the most populous country. By 2050, Nigeria will overtake the United States to become the third most populous nation. The world is diverging demographically with the developed world aging and the developing world experiencing a youth boom. By 2030, the divides are already extreme, with much of Africa having a median population age under 20. While countries in Europe and in China, Russia, and Japan, median ages will be more than twice that. For the developed world, a scarcity of full-time workers will make it challenging to maintain GDP growth. Now, productivity growth brought on by advances in artificial intelligence, AI, and robotics may be key here at the same time. Automation and AI may increase the share of GDP that goes to capital rather than labor, thereby worsening inequality within societies. Ironically, then, choices that corporations make to exploit new technologies can exacerbate social instability. India, Pakistan, Egypt, Nigeria, and Kenya all will have working age populations and growing populations between 15 and age 64. But do they have the opportunities, education, infrastructure, and governance to take advantage of their human capital? Those populations will grow the most in South Asian and African countries, where average education levels are among the lowest. India will have 10 million new working age residents per year in the coming decades, but needs to improve its energy manufacturing, transportation, and education infrastructure. The contrast between India's thriving technology sector and its less spectacular manufacturing sector exposes the gap between the excellent elite education it offers in its universities and poor overall basic education. There is a broader entrepreneurship and productivity gap in the industrial sector. They have once one moves beyond IT and pharmaceuticals. But India and China have another social stability challenge, as cultural preferences for boys have skewed sex ratios in their favor, making it harder for marriage age males to find partners. Recent history suggests that states with youthful populations and insufficient opportunities are most prone to interstate political violence. And we see that. And the failure of governments in Egypt, Syria, Libya, Yemen, and Iraq to provide sufficient opportunities have encouraged instability. Now, ironically, the increasing expectations of a rising global middle class also may fuel dissatisfaction with leadership and provoke instability and mass displacements of people. Now, the migrations provoked by that, in combination with the sense that globalization has not benefited the middle classes in the developed world, are a source of demographic clashes that give rise to geopolitical tensions. And as you know, a new nationalism in the US, the EU, and elsewhere, especially as developed nations with aging populations, may find that their people do not have the skills required to create and use the new technologies of the future. But migration can offer long term benefits to nations with aging and shrinking populations. Now, because of immigration, the US was not projected to grow as old as nations such as Russia, Italy, Germany, Spain, and Japan. The UN had predicted a median age of 40 in the US in 2030. But will current immigration policy changes alter that trajectory? But net net, migration is projected to account for 82% of population growth in high income countries by 2050. So a question is, can new technologies enable intergenerational linkages in ways that create greater productivity and innovation and confer economic strength by educating a broader swath of the population, by educating and building economies that simultaneously take advantage of the energy risk taking and forward thinking of the young, and perhaps the wisdom and experience of the older populations? But that contract, that intergenerational contract, has yet to evolve. But technology is also making governing more difficult. Technological diffusion and communications connectivity can lead to social control slipping away from the state in several directions at once. Technology fosters and supports transnational alliances of multinational corporations, NGOs, and other multilateral organizations at one end, or transnational terrorists or criminal groups at the other. And with the advent, as we've seen, of social media, technology as well allows internal groups to challenge central governments. Of course, these shifts are not merely due to connectivity, but also to the fact that many technologies of the fourth industrial revolution can easily be weaponized. ISIS use commercial drones to carry bombs in Mosul. Grenade launchers can be manufactured using 3D printers. CRISPR gene editing may facilitate the creation of virulence of biological weapons. Cyber-physical systems, which people have not thought enough about, offer new angles of attack, as seen in a recent cyber assault on a petrochemical plant in Saudi Arabia, designed to cause an explosion. Only a mistake in the hacker's code prevented this. Now, Syria offers an example of the intersecting vulnerabilities with cascading consequences that can result from the collision of entrusted interstate and transnational tensions. Conflict between the government and rebel groups that began protesting during the Arab Spring became both a proxy war between the US, Russia, and other nations, and a war against ISIS creating 5.6 million refugees and altering politics in the EU and elsewhere, including the US. In Mexico, the government faces another kind of threat. Conflict between drug-related criminal organizations and politicians, soldiers, law enforcement, and civilians with 80,000 to 100,000 deaths since 2006. And there are states, such as China, that use technologies to exert control, monitor social behavior, and reward behavior that conforms to the desires of the government. At the same time, China is focused intently on innovation and technology and moving away from manufacturing of low-cost products invented elsewhere. The role of education research and innovation is well established in creating economic and social power, and this is only likely to increase in the fourth industrial revolution. Now, scientific and technological leadership is important for China's military power, but also for its international political and economic standing. So in 2016, China announced that under its 13th five-year plan, it would increase public and private R&D spending from 2.1 to 2.5% of GDP approaching the United States. China would also raise the quality and volume of its patents, increase the contribution of science and technology to economic growth, and invest in human capital. Now, the US National Science Board believes that 2018 may be the year when investments in R&D and the Chinese economy may surpass that in the American economy. China publishes more articles and peer-reviewed science and engineering journals today than the US. Its investment in infrastructure for science are impressive. Of the 500 most powerful supercomputers in the world, 202 are in China. Its investments in human capital are equally impressive. With its 1,000 talents plan, China has recruited more than 7,000 scientists, engineers, and entrepreneurs to China. In fact, these are people who studied at the best universities in the world, and China is busily implementing what I've heard described as a sea turtle, sea dove strategy, the sea gull strategy. Sea turtles are older accomplished Chinese-born scientists drawn back home by various perks, both monetary and career-related. The sea gulls are Chinese-born scientists and engineers still in mid-career who are offered certain appointments in China and travel back and forth between their countries of residence in China. But China is developing its own human capital internally, and in 2007 had already surpassed the US in the number of doctoral degrees awarded in the natural sciences and engineering. And by 2030, across OECD and G20 nations, China and India together will produce 50% of the 25 to 34-year-olds with tertiary education, with the US just 8%. So China is following a path that worked for the US in the years following World War II, with government-supported research conducted heavily at universities leading to breakthroughs that end the education of the next generation. And in its stated priorities in science, including quantum communications, quantum computing, brain research, cyber security, robotics, gene science, and big data applications, it is seems to be following research universities in the US and elsewhere in their strategic thrusts. Now, let me kind of close out this way. One of the linchpins of the Fourth Industrial Revolution will be an intelligent internet of intelligent things in which the networks linking key devices and systems are smart and recognize opportunities and vulnerabilities in data streams and the devices they connect also are smart and able to adapt to changing conditions. This is crucial for cyber security, advanced robotics, personalized medicine, and making better use of the tsunami of digital data we generate every day. But geography is, to some extent, destiny as control of strategic resources demonstrates. But the technologies of the Fourth Industrial Revolution will play strongly against emergent and historical geopolitical alignments. There will be a new energy equation, one in which more energy will be produced locally, as well as new definitions of critical strategic resources around the globe, some of them coming from scientific research. Climate change will expose new vulnerabilities and new shocks. Demographics will force a new reckoning between the aging developed world and the youthful developing world. And Fourth Industrial Revolution technologies will both undergird significant transnational alliances and deepen interstate divisions. These forces argue for a new outlook on the part of companies in various industries with respect to how they position themselves globally and for a new governmental and corporate approach to promote peace and prosperity around the world. Thank you very much. Thank you. Thanks very much, Dr. Jackson. You've really given us quite a tour of the horizon of risk. Mary, I'd like to first turn to you. Do you buy the notion that geopolitical risk is quote unquote back in a significant way? And you advise firms, do you see that having an effect on strategy and governance in companies? And moreover, how should it have an effect? So geopolitical risk, back as a political scientist, I feel like it never went anywhere. It's always been there. These megatrends and these trends have been, they're latent. People have recognized for quite some time that the political dislocation and instability would result. But there is just a lack of ability to deal with it. And I think that the, again, I'm a married to an economist and we have this constant struggle. It's politics that matters and for him, it's economics that matters. And in reality, I feel like I'm right now. Like I've been justified, my argument has been justified that the governance gap that we have not kept up with the kinds of changes that Dr. Jackson describes as creating these kind of fissures in society that is impacting business on a day-to-day basis. So even if we recognize there are these megatrends, what do you do about it tomorrow? What do you do when you see the headlines change from day-to-day? What do you do, the US withdrawal from the world, the realignment of these new powers and new centers of power in the world all have implications on business every day and on supply chains, on revenue drivers, on every aspect of business. So I mean, I'm speaking my game here. This is kind of, I came from the political science world into the business world and I feel like the business world is now kind of meeting me halfway. So what do companies do? Eddie Y, and one of the reasons I'm in the global chairman's office and I always kind of tease our global chairman that he's such a forward thinker that we actually say that you don't need just government relations anymore, you don't need, I just, a chief economist, although they're all very smart people, you do need kind of chief geopolitical officer or you need what you need is a geo-strategy and we've come up ourselves, the UI with a geo-strategic business group that looks at frameworks and approaches to integrate an understanding of geopolitics into operations and strategy. So I feel like there has been and I've seen the field itself change quite a bit because as a, you know, starting in the policy world and migrating into, you know, political risk and then actually having taught a class at Georgetown on public-private partnerships, recognizing, you know, companies have to move beyond just understanding it, but what do they do about it? So I guess it's a long answer to your question that I don't think it ever went anywhere. I think it's just the kind of, the realignment of the global, you know, power structure is causing fissures and so it feels on a day-to-day basis, we're just seeing it play out on the headlines but there are things that, the first step, understanding that and what to do about it, I think this is, can try to gain control again of at least an approach to understanding what's happening. Antoine, do you see these kinds of risks becoming more acute and what are the biggest shifts or risks that your firm, Airbus is dealing with and how is it affecting your strategy? Yeah, I come from Airbus, which means a very unique company as it was built from four European nations who put together the whole space industry and that is a unique model that in Europe they want to replicate to all the verticals that never happened, which gave us some specific status when it got to the four home countries, namely France, Germany, UK and Spain and we have therefore a specific relationship for those countries in addition to the fact that you have also a wide portfolio of difference in military business. And to your question, I would go for a very concrete aspect of what we currently see in our business. We're all here doing business and we like stability, we like long-term trends, we like to know where we invest and what we see today is not that. In the last two years, we've been seeing the force industrial revolution coming, turning everything we're doing into the digital world till we had to adapt to that. Then a lot of crises that you've been describing putting us a lot of threat and use threat coming, climate change, immigration, all of that, even turning to Europe. But I would take two concrete examples which happened two years ago, which directly impact us and that we didn't see coming. The first one is actually Brexit. Brexit happened without, we tried to prevent that to happen, but it did happen and the consequences are actually not fully yet mature to be taken into account, but they will be huge. I think that no one would be benefiting, there would be only losers in Brexit, unfortunately, and there will be losers for the whole business. How does it impact a company like Airbus? We have 15,000 people walking in the UK on 25 sides, 120,000 on the supply chain, and basically what Brexit may be putting in place in new barriers, delayed for the supply chain, customs, over cost, and we may want to see whether we need to put most of the business we have in the UK probably back in Europe, because the way we build the aircraft in Airbus is that we actually build the wings in the UK, other parts in Germany, France, and Spain, all that is moving across the formation to try to assemble the aircraft. So Brexit is actually a bad news for everyone to try to make that not to happen, but this is where we see the limit of a big company to turn into politics. The second example I will take, we didn't see President Trump to be elected, and we didn't expect what we see now, which is the return to this kind of US-centric view of economy and putting some kind of a trade war and what may happen between US and China is actually impacting everyone. A concrete example, when the agreement was signed with Iran, we as well as Boeing and others, Company Total and others, we went directly to Iran to sign deals on our side, 100 aircraft, we start to deliver three aircraft, and now we see that the US decision to withdraw from the agreement will have an impact also on this. Another example as well, that we may see with regard to US and China, the US decision to go for some kind of technological and arms race with China, even including to cyber and space, will actually trigger a new arms race for which maybe the other nation may have to see an OEM like us, what does it mean for us? I was in Singapore the last weekend for the big summit, which is the Shangri-La Dialogue for those who know which is a security and defense summit. What was interesting to see there as well, that's why I'm talking about things happening as we speak, is that Prime Minister Modi was a keynote speaker and he just said India would be just being part of the region. We just arrived to be into what they call the Indo-Pacific area, and that is a shift coming in order to make sure that China, Belt and Road Initiative will probably not take all this part. So we see that coming in a week time, President Trump will be meeting with Kim Jong-un, no one knows what it means. So the main message over here is that it's very difficult for us to anticipate what we have to do. It may have an impact on the business anyway, so we need to be reactive or to anticipate, and to anticipate this is where we need to have a strong policy team doing exactly what you just described, to anticipate those risks and to see what does it mean. And we've been doing that, which means that we have a strong political affairs actually in the four home countries in the US, EU as well in Brussels, but we have added to that recently some specific task force working on WTO in which we have some issues as well with going on Brexit to make sure that we can at least, or having recourse with some expert like you, anticipate and all that is brought to the highest level of the company. Why? Because it may have an impact on the business. It may be costed a billion of euros of dollars for the fact. So we take that very seriously and we try to anticipate and we try also to lobby and to leverage, but at the end we don't have a say, we don't have a voice. So we try to use the media as much as we can to warm for the risk and the consequences because the only leverage we have, which is quite key, that we represent something for those omnations. We provide jobs, provide security, we make the economy. We actually put a billion in the GDP early to the UK. So here all that is disappearing at least up to them to see the consequences. Thanks, Dr. Jackson, you if I understand this correctly, do you see on the boards of firms such as IBM, FedEx and Metronik, either currently or past? It's currently. Do you see and must have a finely attuned ear for this? Do you see this beginning to shift agendas in boards? And also we've heard a couple of suggestions for how this could be translated into the way the company actually organizes itself to engage on these issues. Are you seeing some of them? Yes. So let's talk about it. So if one looks at FedEx, FedEx has a global network for delivering things. And it's a very capital intensive business, but it is very much a business driven and linked to information technology because it's a very complicated logistics piece. But it's affected by everything from climate to what a country like China is doing in terms of wanting to do more from China as opposed to including having its own delivery and transport network. It's also affected by what degree of, let's call it, localization a country has in terms of how much is manufactured locally as opposed to made somewhere and delivered somewhere else. As well as more nationalistic tendencies in terms of how much it wishes to be open. It's also affected by global energy supplies because of the nature of what its fundamental business is. But then technology drives new competitors. So Amazon is on the planet, right? Because it created a retail platform, but it is now a platform that allows it to penetrate a lot of different businesses, including FedEx's business, IBM's business, et cetera. Now Medtronic is an interesting one because in many ways it gets affected by what happens with global supply chains because it has what it does sourced from around the world, but it was very much affected by the hurricane that did so much destruction in Puerto Rico. But it is not alone in terms of manufacturing biomedical devices and supplies in Puerto Rico. So this question of infrastructure and what can happen with changing weather patterns due to climate change is a big deal. At the same time, one has the new technology such as 3D printing and automation that can allow it to potentially do the manufacturing somewhere else or structure its supply chain differently. So these are full discussions in boards and they're important discussions. Can we get a little bit of discussion around what does it mean for how you organize this? I mean, Mary, you made the point that if I'm paraphrasing here that companies need to think beyond having a government relations department or a chief economist, please. Antoine, you mentioned that you're beginning to kind of put pieces together in task forces that presumably cut a little bit across some of the work that may have been going on more vertically. What is, we're here at an industry strategy meaning people that advise and CEOs and are really in the engine room of the company's medium to long term strategy. What do we think this implies for the way companies structure themselves? In fact, I'd like to invite any of you to respond to that. Well, I'm happy to start. I mean, I think it's actually a question too still. It's not something anyone has answered. I think the right answer. I think there are very different sectors, specificity around that as well. I mean, it's probably more developed in the extractive industry sector. They're exposed to political risk in a way typically in the past that other sectors weren't. I mean, they can't pick up and move the bind someplace else so their political risk is higher, but that question around, is it a chief risk officer? Is it government relations? Is it a strategy officer? Is it the board? It's almost, I was struck today with Robert Swock at PWC who was talking about gender and diversity and bringing it into the leadership circle and making sure that these, I mean, they impact business, they impact P&L, they impact brand, all of that. And their political risk is no different. And I think there is that sense that we actually are kind of engaged in kind of a listening tour too, to ask companies, what are you doing now? How have you changed? So you've added task forces. I've heard a lot of stories about how they're trying to bring these government relations is more important than ever. But it's still reactive in a sense. And I guess where I'm seeing both the political risk field and also how companies themselves are structuring around it change and shift is, the first step was really to understand what is my political risk profile and I have a global organization, but I also have a lot of people who may see it from different, in a different way. And I think in the article you attached to this, does every company need a foreign policy? They talked about geopolitical due diligence. So just the understanding part that is that first stage in companies, they feel like that's doing something about it, but that's still reacting. So you're still then getting kind of ready to react and the world is changing so fast now. You're like, oh, I can't move this steamship that quickly. Like, so I'm gonna pay consultants to tell me what's gonna happen. And then you're like, well, they didn't say that was gonna happen and that impacted my whole supply chain. So what do I do now? And so the answer ends up being more about process than it is about the right geopolitical advice. Not that I'm under, I mean, I don't wanna be out of a job and I like being able to do that. But I think that political risk firms too are also migrating from like it's not just the intelligence, it's what do you do about it? How do you organize yourself? And it has to come back into the center of an organization in a way that these things can be integrated. I mean, the WTO issues are related to Brexit. Trump is related to what's happening and the European continent populism is happening all over. These things are related and so I think the understanding, so but moving down understanding to actually kind of preparing and then realizing that companies and I think we'll get there but can have a role and actually influence the course of events that they do have a role to play. They don't have to just sit back and wait, and then go, how do I marshal the forces and where do I put these things? And quite often I think what companies are finding is that the risks are unpredictable in many ways but the response is not. So if you know, natural disasters are a conflict is another, you know you have to worry about your workforce. You know there are certain steps you have to take. So even if there's a low probability of an event, there's a way to build in resilience and build in reaction into organizations that allow them to be a little bit more agile. They don't just have to be in that pain point like the world is so crazy, I don't know what to do about it. So I think that again, I mean the answer differs and I don't think it's been answered. I actually read all of this and I don't think there is a best practices manual out there yet. We're certainly trying to create one but I think it's very bespoke to an organization too depending on how it's structured. I agree but I also think there are some fundamentals such as what does resilience mean? Yeah, yeah. And if you think about things that may have low probability but high consequence, you know that you can start there. Secondly, to understand the connectivity of things. So there can be a decision about Iran and sanctions and it can affect an airbus very directly. But at the same time, if through its belt and road initiative China is marching along and it's going to put infrastructure through Eurasia, through Iran and Iran is a major energy trading partner then how does that change trade relationships, relative geopolitical practices and how companies do businesses with these different countries? This kind of connectivity is something I don't think companies can stay away from but they also have to engage with policy makers because of that. Now we need to engage with a lot of people. That's why we need to dedicate resources because if I take this example, you know, we are usually close to our home countries because this is where we can lobby with them, use them and at least for us, for European nation that's the European voice which could be strong. But when you go elsewhere, you go to Asia, you will have one customer, you go to nation X but this nation will do this because of this influence of China or India so you need to see completely broadly what it means the landscape for in order to make sure that you can understand why this requirement could be triggered by these kind of regional politics and not only one single nation. So we need to engage those kind of regional aspect which sometimes means that we need to talk to a lot of nation to make sure that we can show where they may have mutual interest in going one direction and therefore our interest will be their interest too. You know, the practice of statecraft by states is tricky in and of itself in many respects. For a company whose primary role is not to necessarily engage in political relations, one imagines that would be even trickier. And I'm just wondering, you're mentioning that a lot of this is not just about assessment, it's about understanding how to engage, how to act. That gets tricky because sometimes a company maybe have as its home base a country that is taking an action in foreign policy that may be quite complicated for a firm straddling multiple markets. And one I imagine often has some difficulty in figuring within a company just how much of an actor should one be. I mean, you mentioned Brexit Antoine. Can you recall, can you reflect a little bit, how did Airbus engage in the run up to the Brexit vote? Were you more or less trying to be circumspect, keep relatively quiet and neutral? Were you an active participant? Actually, we were quite active because even our CEO wrote in financial times, tribunes warning about the effect of what would be and positioning himself being against Brexit strongly. Of course, as I said, we don't have any say, we only have a voice. And we continue now to try to see whether we can go for something which could be a soft Brexit because the consequences would not only be for us but also for the whole UK economy if should we have to remove some of the assets from the UK due to trade, customer and tariff. So it is difficult because the only thing that we can do is read to one about the consequences of something which is seen in different prism by the politicians. I mean, we're sitting at a very, very poignant moment for this issue because as we speak, multiple major countries around the world are drawing up and promulgating sanctions or I'm sorry, not sanctioned, tariff lists as in multiple sectors. And usually trade policy is made in rather close consultation as this community will know with companies in this regard, but many of the companies are operating in multiple jurisdictions that are now drawing up these trade sanctions lists. But that's a great example. I mean, trade is, I mean, I think of one of the questions you had asked in preparation on what is one of the largest geopolitical disruptions that you're seeing companies deal with and looking at trade as a geopolitical issue and not just an economic issue, I think it's becoming clear and that's why it has moved out of, sorry, why it has moved out of the lawyers and the trade negotiator on a higher level. But companies do have something they can do about that and I think the benefits of trade, particularly in developed countries, is really not, the people who have suffered from it do, they need to be listened to and there needs to be a solution to that. But the benefits overall, companies have not been as loud as they could be on how to address some of the socioeconomic dislocation of trade, what their responsibility is there, what are the retraining elements that can be done, the kind of work that you guys are all doing and companies participate with you in that. But I think that voice being that classic problem where those who have been left behind have a louder voice than those who have actually benefited and you don't want it to be a zero sum game. You want people to be convinced and you need policy and you need companies to work together so that there is a more inclusive, and if more, a rising tide raising all boats that it isn't this kind of political, these political consequences that we see playing out now. And so trade I think is a very interesting issue where companies not only can have a policy voice but can have an active programs around addressing some of the negative consequences of trade policy that can move it in a way that can benefit everyone, I agree with you but it also has to be seen through the double lens of those who are left behind in a developed economy because of trade policies but those who are in developing countries, particularly countries where a lot of the resources are garnered that the developed world uses. And so if you're talking about not having a zero sum game, all of these things have to play into the equation. The point I would like to raise is that I mentioned that it's very difficult for a company to be anticipating what is happening in geopolitics, especially what is happening now is so much dynamic, it's the most impossible to try to see what will happen. On the other hand, what we try to do and coming back to your presentation and the big trends, we try to see what would be the major issue for which we want to enter some kind of new businesses or change due to that. And we do that, if that is coming, you mentioned 2013 in your slides. You're all aware that South from here in Los Angeles, there is someone who is having the ambition to go to Mars with Elon Musk and he wanted that before 2030 and one of the reasons why he said he wanted to go there and Jeff Bezos is following the policy that they want to get there, some of the resources they believe the Earth will not be providing anymore. So that's an interesting question with regard to how much we need to anticipate to go for extra resources, alternative as you just mentioned, elsewhere than on Earth. So, ourself, we're still wondering whether there is really a space economy behind that but there is a kind of trend for which we need to be prepared because for sure, China, the US, European will be on moon to stay on moon in the next decade and we see how much business is coming from that. Another point for which, as you didn't mention, probably three quarter of the people on Earth will be living in big cities in the future. The whole cities will be different. You probably heard about the KSA, the Saudi Arabia, new concept, the Mohammed bin Salman is developing for new cities, one on the Red Sea called Neum, for which it's going to be from scratch, a completely new city based on the requirements you see for the customers of the future. The so-called smart city will be actually based on connectivity on everything that we need now to have. And that is a kind of thing that we're preparing ourselves. My message here that it could be some kind of opportunities in view of the future by bringing together technology in order to solve future customer requirement. Another example of that, we're working on the urban and mobility with a session on that this morning because here we take the one-on-one elsewhere in some cities, Beijing and others. Congestion on the road is making the whole life of cities the most impossible. So achieving any kind of means to try to transport people in the air is something for which we can try to see whether we can anticipate the development of new transport. So this is to say that when we can anticipate which could be future customer requirement of how we can then solve some of the pain and not ensuring to so much conflict or freeze which could turn to be geopolitics, we do so. What is very difficult for us to do is actually to try to be reactive to some politics which is changing due to the last week or even to see whether China want to develop something which probably will never work because a lot of countries will not see that in their interest. Okay, thanks. Let's open the conversation to the audience. If you would like to raise a question or make a brief comment, please do so. But first just to tell us your name and your affiliation. Yes. Good afternoon. My name is Vasuki Shastri. I'm from Standard Chartered Bank. Many of the issues that we raise is very familiar from banks such as us. We operate in 68 very diverse emerging markets. And certainly reflection of the last three, four years is the nature and intensity of geopolitical risks. As they have risen, there's certainly pressure from the board and the senior management to try and put an internal process, an internal structure to understand how these risks can be managed. I mean, it'll be great if you're able to anticipate some of this and do an impact assessment around that. But certainly on the big global macro-political risks, I think lots of firms are now putting some structure and governance around that. But I think companies will be in a very difficult position to look at the proposition of the discussion on do we need an active foreign policy. And we certainly, as a bank over the past year, have been placed in a very uncomfortable situation where three, four countries have been in conflict. And the countries themselves making a request that we should decide whose side we are on. Managing that process and trying to bring, in this case, the UK is our home regulator, trying to bring in the UK home regulator involved in this process really adds a level of complexity. And I'm sure our shareholders would much rather prefer that we take a neutral stance. Okay, thanks. Any other question or brief comment? Good afternoon. John Gordon from New York Presbyterian. Given, I guess this is probably a gross oversimplification, but I guess you in part attribute this turn towards fragmentation, towards nationalism, towards populism as kind of a reaction to some of the continuing aftershocks of the Third Industrial Revolution. And now we're sitting here talking about the fourth. And I'm interested to get the panel's thoughts on, do you see anything that returns us towards, brings the pendulum back towards more stability or does this continue to push in the other direction without coming back? Is there a third question or brief comment? Yes. Good afternoon. I'm in charge of government relations at booking.com. I think government relations for a long time was based on an assumption understanding that political decision making follows rationale and an evidence-based principles. And a problem that I see is increasingly, even in Western countries, I can take, we talked about Brexit, you could take the US, you could take the new Italian government, there's a risk of decisions being really driven by populism. So even in this market, it's difficult for companies to rely on these principles. So that's a question maybe to Marien Antoine how you deal with that because it leads to frustrations as company leaders when they do take the time to engage with governments but feel that they are not listened to or simply ignored or that facts don't matter. It does not make it easier to get their engagement. Thank you. Let's invite any of our panelists to respond to one or more of the comments that have been made. Well, on the question where they are to the European situation, where they are to populism, and you did mention the Italian government, which of course is not a good news for Europe. Losing UK, the fear that people had in Europe was a domino effect. Having already some populist government in some Eastern European countries already being elected some while ago, we hope that's gonna turn some while soon but it may not happen probably too soon too. So what we see that there is a risk for which other nation we want to turn should Brexit seems to be at the end for the UK something profitable. It could also probably be another example for nation to follow and that would be in probably the end of the EU as we know it today. So for a company like us, we always try to stay outside of politics but we cannot because we're involved in what happened in those countries because we have actually plans in some of them, not in Italy for airbus, between that the consequences of everything you just described would be that maybe we want to invest some other places. We want to see whether China is something worth considering and we do so. So we're looking much more what the gross is whereas in some parts like say in Europe where we see that the forecast on the political side may not lead to some kind of change. Conversely, it could be even worse. We may not want to invest in the next five to 10 years in those countries. Mary or Dr. Jackson? Go ahead. Well just on that first, how do you choose your issue? I mean in companies I think there is that to your question need to stay, certainly on certain issues need to stay objective, need to be above it and I think that was even in the article you had that tried to remove yourself from the complete association with a home country or a whole set of political views that come along with that. But so choosing when to engage I think is one of the key issues business face today too. I mean even in the US too when it came onto gun violence or a lot of these issues ask some companies are very comfortable saying I'm gonna take this action and other ones that I'm not comfortable with that. And so I think we are in that time when companies are gonna have to ask themselves how do they and when do they engage? And there are some issues that like that you can't take sides and that's not something that would be good for your business or wouldn't be good for your employees most likely it sounds like. But there are like when I see in this I'm gonna just get to that second question when I see if there are any signs of stability is that even like with the SDGs I mean a call out for private sector desire to be part of the SDGs but to be part of it in a way that they can get credit for like that they can actually claim on a balance sheet or that they contribute what they're kind of intellectual firepower to helping solve or helping further one of the goals along some of the metrics that are there that there are issues companies can and this again I'm trying to pull it together takes a coordinated division within a company that can say what do we do best and how do we contribute to markets that we operate in not just benefit from them. And that idea that the shareholder primacy or that shareholders don't it has to be about the shareholder I do think that is moving along and that it's good for shareholders if it's good for stakeholders. And so I think that conversation has developed quite a bit. So the stable pieces that I see that companies are impacted by populism they are impacted by trade barriers they are impacted by the decreasing flow of capital labor and it just we live in a globalized world as a company and countries are pulling back and so there's this huge disconnect. And so as companies to continue to pursue the benefits of what connection can be I think is ultimately a political move and can be and it can be done in a way that's strategic and can choose the issue that you can contribute to in a positive way and stay in that sense apolitical. It's difficult, it requires strategy but I do think it's an incredibly important role for companies to play because especially in a developed context and in a democratic context where companies really do have that employment and training and all of the things that are gonna help us get through the fourth industrial operation if it's not integrated they're somehow attached to the development of a community that governance alone is not gonna get us there. I think we've already seen that. Thank you. We've reached the end of a lot of time. Sorry, did I take that? Dr. Jackson, did you wanna make a 10 or 22nd final thought? We'll give you the final word. Major corporations are not without power. They do provide employment. They do make a difference in how people live and back to the gentleman's comment over there they can affect how people live. The world's becoming urbanized. There's a lot that companies can do. Antoine described some of that with transportation systems. If you can help to settle that out for people not alone but contribute that can lessen some of the tensions that are gonna be there whether they're ethnic, religious, social, other things because where people live in the end and how they live matters to them. I think I've taken away from this discussion that one of the main foundational principles of the forum which is what we call corporate global citizenship the notion that companies are stakeholders of the internet of themselves of the health of the international system or the robustness of the world economy. If anything in these days with the rise of a whole series of secular risks it demands an even more serious degree of attention to this and maybe even thinking about how in some creative ways and transversal ways companies organize comes for this. Last thought is that you had mentioned that there is no best practice for this yet at least that you've identified and maybe that's the kind of dialogue that would be useful to pursue using the forums platform as a closing thought. Can I invite you to join me in thanking very much our very thoughtful panelists and we bid you a good day, good afternoon for the rest of your meeting here. Thank you.