Business has a responsibility to make sure globalization works for everybody so people don't end up taking extreme political options, the head of Credit Suisse told CNBC at the World Economic Forum in Davos on Tuesday.
"We have seen across the world the benefits of globalization…but we have also seen the tensions. The cracks in the system which then found a political translation," said Tidjane Thiam, chief executive officer (CEO) of Switzerland's second-largest bank.
Explaining that business had done a poor job of communicating the delivery of its benefits to broader society, Thiam added, "we have to behave better…and become more effective at articulating what we do and the positive things we do."
Thiam was joined on a panel entitled "Size Matters: The Future of Big Business" by Andrew Liveris, Chairman and CEO of The Dow Chemical Company, who posited that the future belonged to smaller companies which are better able to demonstrate flexibility in responding to customer and societal needs.
"Large-scaled, public, diversified companies have probably seen their day…(you) have to have the eco-system of the small inside the big," affirmed Liveris, who recently accepted an invitation by Donald Trump to head the American Manufacturing Council once he assumes the U.S. Presidency on Friday.
Also on the panel was Alphabet's Chief Financial Officer Ruth Porat, who repeated her company's oft-cited mantra that "Incrementalism leads to irrelevance."
"If you don't push the frontier you do end up by really becoming that incremental player. That is as true outside of technology as it is inside," added the former Morgan Stanley long-time executive.
Picking up on the theme, fellow panelist, Martin Sorrell, CEO of advertising behemoth WPP Group, criticized the culture of short-termism in business, particularly pronounced since the collapse of Lehman Brothers in 2008, for encouraging a lack of sustainable and transformative strategic investment.
"If the repatriation of profits is used yet again to invest in dividends and buybacks, what's the point? It's really got to be much more fundamental, long-term investment," stressed Sir Martin.
Focusing specifically on banks, the panel evaluated whether they were still too big to respond effectively to society's needs and concerns despite the concerted and relentless efforts of regulators to restructure the industry since the financial crisis.
According to Credit Suisse's Thiam, banks still have work to do to in order to convince a skeptical public of their beneficial role in society.
"We took for granted for a long time that we had a licence to operate, that society wanted big companies to exist and I think under the pressure of the financial crisis and the spread of information via social media, that mandate is getting weaker and weaker," he explained.
"We really need to become much more nimble and articulating what we do and the benefits…for me regulation in many ways has become an expression of the loss of that mandate," he concluded.
