Government leadership and action

The financial crisis has spurred unprecedented levels of government intervention in business and highlighted the importance of international coordination in addressing global and systemic risks.

As a result, CEOs are looking to governments for leadership and reconsidering the old maxim that less government is better for business. Governments, while willing, were under-prepared for the global action that the current financial crisis requires. Some of the long-term trends that most concern CEOs could have even larger impacts, but thus far CEOs remain frustrated at the past track record of governments in trying to address them.

For instance, more than 45 percent of CEOs do not believe that government efforts have been effective in securing access to natural resources, creating a skilled workforce or formulating clear and consistent long-term environmental policies.

REN Jianxin, President of China National Chemical Corporation (ChemChina), speaks on government leadership and response to the financial crisis and this affects confidence in different countries.

CEOs want governments to strike a difficult balance. Last year, we termed this the "regulation paradox". On the one hand, CEOs want more government leadership and action, and not only on economic and climate change issues. On the other hand, CEOs are inclined to believe that government action is good when it helps the business and bad otherwise. In the past, they have usually called for less intervention. Despite their criticisms, CEOs still accept the need to work with governments on central issues, particularly where regulation is a business enabler.

Together, these conditions open an opportunity for businesses and governments to start moving from collective stasis to effective global collaboration. Governments and businesses will not only need to collaborate, but to create innovative solutions jointly.