PRovoke Asia Pacific Communications Summit: How Are Asia’s Global Brands Navigating the New Geopolitics?
From bans on Chinese apps to movie boycotts, companies are getting caught in the crossfire of geopolitics. Arun Sudhaman, CEO/Editor-in-chief at PRovoke Media, moderated a session on “How Asia’s Global Brands are Navigating the New Geopolitics” at PRovoke’s Asia Pacific Communications Summit. His thought-provoking questions drew sound advice and helpful insights from Fidelity International’s Catherine Yeung, Abhinav Kumar of Tata Consultancy Services (client) and Yusuf Hatia of FleishmanHillard.
Catherine Yeung, Investment Director at Fidelity International, said China and Asia are growing in influence through brand building and innovation. She commented:
- The world is seeing very rapid growth of Chinese brands, driven by China’s focus on innovation. This is very different from just a few years ago, when China was sometimes perceived as merely the factory of the world.
- Chinese companies are increasingly listed in both the US and Hong Kong or China. This then begs the question, are they a Chinese company or becoming more global?
- China is undergoing many reforms as a way of opening its capital markets. For example, one emerging trend has been Chinese companies and the regulator focusing more on sustainable investing – China has shown a dramatic improvement over the past couple of years in the area of corporate governance and ESG (Environmental, Social & Governance) investing.
- We are seeing companies increase their brand equity or market share by creating products and services that appeal to the domestic consumer base – be it through innovation or national pride.
- China has been growing its economic influence over the past decade. the biggest shift over the coming ten years is likely to see global portfolios increase their exposure to Chinese assets including shares in Chinese companies.
Abhinav Kumar, CMO, Global Markets at Tata Consultancy Services said that given the increasingly more complex geopolitical scenario that our world faces, the role of communications in companies has never been more important:
- 2020 marks an inflection point on two mega trends. First, an Eastwards economic shift, with over 50 per cent of world GDP (in purchasing power parity terms) now coming from Asia. Second, a shift in drive towards technology – with over half of the world (3.8 billion people) now active on Social Media, 70 per cent owning a smartphone and 60 per cent active on the internet all taking place this year, along with a huge acceleration of digital transformation due to the pandemic. Both factors are contributing to a shift in politics and consequently challenges for communicators.
- There has been a rise in the importance of ‘geographic branding’ (the perceived point of origin of a company or a brand) given rising economic nationalism and trade frictions. Companies must take a more conscious and considered strategy towards how important their location is to their brand. This is especially true for companies where a geographic element is built in the name of the company itself.
- The goal for any multinational is to be seen as a national brand in every country where you operate. TCS operates in 46 countries worldwide and has been making long term efforts to enmesh itself with the economic, social and cultural aspects of each market it operates in. You must be a part of the community, and truly localize your message.
- Businesses need to be politically neutral, but at the same also need to be engaged positively with governments. And in many cases, these public-private collaborations can be a force for good. Being politically neutral doesn’t mean companies can’t take a position on societal issues like climate, inclusion, equality and other issues. There is a growing expectation on businesses to play a more active role on these fronts, with a growing trend of ‘CEO activism’.
Yusuf Hatia, Senior Partner & Managing Director of Client Experience, International Markets at FleishmanHillard, said companies increasingly need to be aware of geopolitics and plan accordingly.
- Consultants are now expected and required to understand geopolitics and the potential client impacts. This is both a challenge and an opportunity.
- Customers and other stakeholders expect companies to take a stand or have an opinion on major issues. It’s getting harder to stay neutral.
- Companies need to think long-term and must be authentic to be in a position to weather short-term shocks.
The geopolitical environment is growing in complexity, and the increasingly interconnected nature of both social and traditional media make it more likely that an issue that develops in one country will spread to others. Brands need to be conscious of geopolitical factors and aware that what works in one country could cause an issue in another. Communicators and consultants must build the knowledge base to help organisations navigate this ever-changing landscape.