Business Leaders Summit 2016 - Introduction


As predicted, 2015 was a year of tumultuous geopolitical and market change and the volatility intensified as we entered 2016. By early February, when 200 business leaders joined us in London at our fourth Lloyds Bank Business Leaders’ Summit, the outlook for growth was more subdued than expected, particularly in emerging markets and developing economies.

Clare Francis

Managing Director, Head of Global Corporates, Lloyds Bank

Geopolitical uncertainty seemed to be the new normal. Against this backdrop, and given our Summit title of Growth, Resilience and Agility, it was unsurprising that our discussion this year kept returning to the theme of agility, as it had in 2015. As we moved through the morning, we covered various aspects of strategic and business agility but in particular financial agility and how companies should become more agile on managing costs.

The tone of the morning, despite the market backdrop, was optimistic overall. Our 2016 Lloyds Bank Business Leaders Survey - carried out by Ipsos MORI during December and January - had already suggested you continued to be a bullish group. It showed that more than 70% of you expected the global economy to improve or stay the same and 90% of you expected the UK economy to grow in line with or better than the G7 as a whole. In his keynote address the Foreign Secretary, while not minimising the geopolitical risks we faced, was optimistic about the British economy and our future prosperity.

Nonetheless, when the Survey had asked you to identify the most significant risks to your business performance for the coming year, 43% of you had picked geopolitical uncertainty and you had put volatile economic growth a close second. You had also told us that macro challenges in the US and Asia were as significant for you as the risks around Brexit. This was probably linked with the fact that 84% of you had felt that the UK would vote to remain in the EU; the sentiment at the Summit seemed to be that this percentage would fall as the Referendum came closer.


Uncertainty and the accelerating pace of change, we agreed, defined the environment for leading a business today. However - and this was covered in almost every Summit session - disruption, whether as a result of the global economy, geopolitics, globalisation, changing consumer behaviour, demographics, digitalisation or diversity, should be an opportunity as well as a challenge for agile businesses.

So what did agility mean in practice?
Amongst many areas, we talked about the need for a state of constant alertness plus a willingness to disrupt and how this requires entirely new skills and attributes in today’s business leaders.

Agility was crucial to delight today’s ever more demanding customers. In our "experience first" interconnected world, driven by the internet, what was vital was the ability to understand what mattered to customers, to meet their expectations and to provide them with a positive interactive experience.

We also discussed the need for financial agility, not only to be ready to seize business opportunity, but to manage risk by insulating against shocks in a volatile world of unknown unknowns. We knew from our Survey that many companies had increased their liquidity buffer and made their balance sheets more resilient over the last 12 months. However, this had been supported by cheap capital and available liquidity and we talked about how business would increasingly have to look at new ways to mitigate against uncertainty.

Answering a new question about boardroom focus in this year’s Survey, you had told us that your boards were as focused on managing strategic or operational risk as they were on targeting growth and this reinforces what the Lloyds Bank team has been hearing anecdotally from clients. Today’s boards definitely appreciate that risks must be properly understood and managed to unlock opportunities.

The Lloyds Bank team explained how the banking industry was rising to this challenge by helping clients understand financial risks whilst pursuing growth. We questioned how many more black swans we would see "swimming around" and whether liquidity in credit markets would be deep enough if we all "ran for the door" at the same time.

“Every speech and panel touched on the enormous new opportunities but also the existential threats we face as digitalisation completely disrupts our familiar patterns of production, consumption, finance and competition.”


In no area was agility more important, the Summit agreed, than in facing the implications of the Fourth Industrial Revolution or Second Digital Revolution.

This megatrend, which had been front and centre at Davos just two weeks before our Summit, was also front and centre for us. Every speech and panel touched on the enormous new opportunities but also the existential threats we face as digitalisation completely disrupts our familiar patterns of production, consumption, finance and competition. In addition, as Professor Ian Goldin noted, there was a broader set of megatrends creating challenges for business. For example, all economies were experiencing rising inequality as the rewards for seizing the benefits of change were disproportionally high. He also reminded us how greater connectivity and technological advances could be used to bring about bad outcomes, such as a cyber attack, as well as good. Cautionary words given that our Survey had shown that only 10% of you had put cybersecurity in your top three most significant risks, even though this was up from 6% in 2015.

Findings from our Survey led us to discuss whether companies were moving fast enough to respond. Only 28% of you had said that technological change was amongst your top three opportunities to improve performance. The speed of technological change had concerned only 10% of you. Some organisations had begun transformational change but others were still working it through.

Digital transformation, our speakers told us, was risky and challenging yet it was the biggest race of our lives. Finding the right talent was important to staying relevant and a number of speakers, including Shadow First Secretary of State Angela Eagle MP, emphasised that improving diversity and increasing skills was key.

Video: Introduction to Business Leaders Summit 2016


Our 2015 Summit took place in Lloyds Bank's 250th anniversary year and was where we cemented our two year engagement with UKTI. We hope that our 2016 Summit has made a further and valuable contribution to this partnership as Helping Britain Prosper Globally has continued to be our mutual objective. Lloyds Bank recognises that, as we play our part in helping companies active in Britain in achieving their growth ambitions and global success, Britain will prosper as part of the global economy. Supporting companies also means playing our part - alongside national and local government and other partners - to support the UK economic recovery and to bring about the conditions for sustainable growth in the UK.

When we started out with our first Summit, we never imagined that our collaboration would grow in such scale and substance or that this event would become an annual fixture. It was a pleasure to have brought together a distinguished group of business leaders from companies that represent nearly a trillion dollars in both combined revenue and market cap and collectively employ more than three million people. It was also a privilege to provide this opportunity to listen, to obtain new insights, to examine and debate the issues of the day and to share our experiences. We look forward to building on many of these themes with you over the next twelve months.

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