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Dear Hunter,

As 2017 rapidly winds down, I write to share a few end-of-year insights and a few hopes for the new year. While 2016 ended with some major surprises (Brexit, Trump, among the two most noted), 2017 concludes with its own set of uncertainties and disappointments, even if fewer surprises. The good news is that global macroeconomic performance is stronger and more evenly distributed than at any time since the Great Recession. The bad news is that multiple, overlapping potential disruptions loom – from geopolitical conflict (with the Middle East, the Korean peninsula and a major terrorist event(s) the most menacing), to further centrifugal forces tearing at the fabric of global integration (Brexit, NAFTA failure, further populist threats at the ballot box), to the prospect of a crippling cyberattack.

Yet in my view the biggest threat….and opportunity….in the year ahead relates to whether or not the global rising economic tide more equitably lifts the fortunes of the majority of those who have not yet shared proportionately in the largesse of globalization. I believe the lack of truly inclusive growth is at the heart of most of the challenges we face. Populist demagoguery festers when people feel cheated out of material benefit, decision-making and respect (as Kathy Cramer observed in her insightful book “The Politics of Resentment”). This is as true in Moscow, Mumbai and Manchester as it is in Appalachia, Alabama and Arkansas.

Back in 2005 in “World Out of Balance” I sketched out three alternative scenarios to characterize the possible future state of the global business environment. “Open Borders, Lingering Fears” assumed we would resist nativist populist fears and continue to benefit from the rapid movement of people, goods, capital and ideas. This was, in fact, pretty much the state of the post-Cold War, pre-Great Recession world. The more likely scenario I labeled a “Patchwork World”, a kind of muddle through global environment with patches of the world mired in poverty and violence — though not spilling into areas of affluence — conditions which it could be argued characterized the early post-Recession years. The third, most pessimistic scenario was called, “Castles and Moats” a world in which those who “have” try to insulate themselves from those who “have not,” punctuated with vicious cycles of war, crime, terrorism, resource competition and disease.

While no scenario is ever completely right, the benefit of looking over the horizon with rigor and imagination is to conjure up alternative possible futures in order to fashion a more favorable future than the one which might otherwise be trending. My fear is that we are at risk of tilting toward a world of “Castles and Moats”. Just in the US, for example, during the last thirty years when the world has experienced greater economic lift than at any time in history, the top 0.1% of households with assets in excess of $20M accumulated 50% of all the new wealth created. So now this one-tenth of one percent of super wealthy American households control as much wealth as the bottom 90%. Such non-inclusive growth is neither healthy nor sustainable and will ultimately work to the disadvantage of society at large, rich and poor, young and old, conservative and liberal.

But I am encouraged that this is not a revelation for most, and the farsighted CEOs whom I have had the good fortune to work with over the last year are increasingly focused on what they can do, even if government is not yet completely tuned in, to ensure the proceeds of growth are used to benefit broad groups of stakeholders.

If you have not already seen our Global Business Policy Council 2018 Year-Ahead Predictions [ https://info.atkearney.com/email_handler.aspx?sid=623b8cb7-f3bc-4700-83e0-18b7a016916b&redirect=http%3a%2f%2fwww.atkearney.com%2fYAP2018 ] , you might be pleased to know that despite the challenges I cite above, there are some downright positive developments we believe the new year will bring us….from the supremacy of quantum computing and all the benefits which will flow from this leap forward in computational power and scientific discovery, to breakthroughs in cancer treatment coming from the convergence of multiple technologies allowing us, in part, to reap the benefits from mapping of the human genome.

Throughout all the twists and turns of a world of continuous, disruptive change on the global, national and professional stages on which we play every day, the year end is a good time to pause and reflect on the wisdom of the Australian hospice worker Bronnie Ware. She shares with us the common refrains of those coming to life’s end. Among the shared regrets of the dying are wishing one had the courage to live a life true to one’s dreams, and not the expectations of others; having worked so hard so as not to make enough time for family and friends; having the courage to express one’s feelings; and realizing that happiness is a choice and one shouldn’t fear the change needed to have a more fulfilled and happy life. Good messages to muse.

I thank you for your friendship and support in 2017 and look forward to staying in touch in the new year. My resolution is to strive to live a more purposeful life, helping to encourage inclusive growth with the hope and promise it brings for all of us.

With my warmest wishes for the new year!

Paul

Paul A. Laudicina

Chairman, Global Business Policy Council

Partner and Chairman Emeritus, A.T. Kearney

A.T. Kearney, Inc.

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