On November 9, Douglas Peterson, President and CEO of S&P Global, delivered a speech entitled “Key Global Risks and ESG” for lecture series “Future is Here: Global Leaders on the Changing World” at Tsinghua University.
Douglas Peterson joined S&P Global in 2011 as President of Standard & Poor’s Ratings Services and took the post of President and CEO in November 2013. Previously, he was with Citigroup for 26 years, with rich experience in business transformation, investment and corporate banking, brokerage, asset management, private equity, and retail banking.
Peterson analyzed future global risks from several aspects. First is sluggish global economic growth. Japan and Europe are still in the process of economic recovery, while the US is undergoing a slowdown in economy growth. Second is that rising interest rates would exert more pressure on long-term government debts. Since the financial crisis, global liquidity has flooded and interest rates have fallen to very low levels. It is now necessary to gradually enter the interest rate hike cycle out from the loose monetary policy. However, the debt level in many countries is rather high, with their debt-to-GDP ratio exceeding 100%, and a rise in interest rates will bring significant impact on these countries. The third risk comes from geopolitics. Populism has gradually risen in many countries and regions around the world, directly impacting the US presidential election and UK’s Brexit. In the future, populism may continue to affect geopolitics. Fourth risk is brought by technological transformation. The pace of technology innovation has greatly accelerated, and emerging technologies could overturn existing business models, posing challenges for company CEOs. Trade protectionism and climate change are the last two risk factors mentioned by Peterson. He is convinced that all countries and citizens should pay more attention to ESG (Environmental Social Governance) to better respond to global risks.
In his dialogue with Dr. Min Zhu, Douglas Peterson talked about the dynamics and resistance of US economic growth, impact of technological progress on different industries and global impact that the US interest rate hike may bring. He also hoped that China-US trade frictions could be fixed promptly and properly. He stressed that the United States should adopt a more multilateral approach to international trade disputes and put forward more constructive solutions based on the existing international trade system, instead of adopting unilateralism and negative accusation policies.
During the Q&A session, Douglas Peterson talked about the far-reaching significance of RMB internationalization, impact of the US mid-term elections on China-US business relations, and Fed’s possible attitude toward interest rate adjustment. He also proposed his vision for China’s establishment of a more advanced and international financial market.
“The Future is Here: Global Leaders on the Changing World” Lecture Series is organized by Tsinghua University PBC School of Finance (PBCSF) and National Institute of Financial Research (NIFR), inviting world-renowned leaders and academics to share their views on the frontier trend of world development.