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23 May 2019

Panic now or keep calm and carry on?

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How weird the world has become: a clown forms a political party that gets into Government in Italy; a comedian wins a landslide vote for the Presidency of Ukraine; a brazen liar who governs alone, by gut feel, on Twitter looks set to win a second-term as President of the most powerful country in the world; and a suicide bomber queues up politely for breakfast before blowing up himself and others in a synchronised mass attack on churches and hotels in Sri Lanka.

Less weird but equally worrying, some of the world’s largest corporations appear to be out of control and untouchable, setting their own rules and ethical standards to suit themselves.

Global technology giants like Facebook, Google, Amazon and Apple have created huge challenges for competition watchdogs. Those companies dominate markets in a way few have dominated before, from e-books and smartphones, to search advertising and social-media traffic. Rather late in the day, it’s spurring a global debate over whether it’s time to rein in such winner-take-all companies. But reining in bad behaviour is one thing, changing the culture that causes it is another. The EU has started raising the size of its fines, although set beside their vast wealth it’s hard to see any fine worrying them unduly, while the U.S. which has largely been hands off, is gearing up for action.

It’s not just a problem for a new technology sector. Volkswagen, the largest car group in the world, was forced to apologise recently after Herbert Diess, its chief executive, repeatedly used the phrase ‘Ebit macht frei’ (earnings before interest and taxes will set you free) to managers in an echo of the notorious Nazi phrase ‘Arbeit macht frei’ (work will set you free) which was written on the gates of Auschwitz concentration camp. As a VW investor said, it’s not a sentence you can say in Germany. Heading a company that was founded at the behest of Adolf Hitler, that relied on concentration camp labour during its early days and coming soon after his visit to Auschwitz in November, he must have been tone-deaf. But even with senior executives in jail, in court or indicted for deliberate use of software designed to cheat emissions test in at least 11 million vehicles, and with costs of the scandal over £25bn so far, VW seems unperturbed by how others see its behaviour. Owners of VW, Audi and Porsche cars also seem unconcerned by the discrepancy between claimed and actual emissions, as they continue to buy VW cars and drive to work or drop the kids off at school.

VW is not alone, and trust in companies, organisations, the media and politicians is low and falling. But if large fines, imprisonment and damage to their reputation doesn’t work, what will change their behaviour? What can?

The truth is, behaviour is rooted in culture and culture is deeply embedded in our organisational ‘DNA’, as deeply rooted as our biological DNA.

Given the urgent need for countries, companies and people to change the way they live and work to stop rising carbon emissions, are we able to change enough to make a difference? Or quickly enough?

With our city streets filled with Extinction Rebellion climate-change protestors, challenging Governments and us to panic now and take drastic action to ensure our children have a future, these question have never been more relevant or timely.

For market insights and strategy to help you grow in a changing market, call Lucia Di Stazio on 01453 521621 or email

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