02 Sep THINGS AREN’T AS BAD AS THEY SEEM; COMPANIES SEE MORE PROTESTS OVER EXECUTIVE PAY
Welcome to this week’s business and media intelligence update.
AND NOW FOR SOME GOOD NEWS: THINGS AREN’T AS BAD AS THEY SEEM
As you spend yet another day locked down at home, in front of your screen, you are most likely thinking that things are really, really bad. Yes and no.
Here is some positive news: Despite all predictions, including some rather breathless media commentary, GDP in the past quarter grew by 0.7 per cent, which means that Australia’s economy has avoided a double dip recession, at least for now.
According to new figures from the Australian Bureau of Statistics (ABS), national growth hit 9.6 per cent in the 2020-21 financial year, the largest increase in the country’s history.
These surprising growth figures were driven by recoveries across all sectors.
Economists are still expecting a contraction of between two per cent and 4.5 per cent in the September quarter, but these new economic growth figures point to a path out of this decline with household and business spending rising.
This means that for a contraction to occur in the December quarter – which would trigger a technical recession, restrictions would have to significantly tighten.
And this is unlikely to happen, at least in NSW and Victoria, as more and more of us line up to get vaccinated.
Which brings us to the other bit of (very) good news: almost 60 per cent of eligible Australians have had their first vaccine shot, which is a remarkable achievement given the slow initial roll out.
Read more about the new ABS data here.
EUROPEAN COMPANIES SEE MORE PROTESTS OVER EXECUTIVE PAY
While shareholders might have been forgiving of executive teams in the early madness of the pandemic in 2020, they might not be so lenient this year.
A new report by European corporate governance consultancy Georgeson has found an 18 per cent increase in shareholder complaints over executive pay.
The issue was most pronounced in Spain, where 61 per cent of companies on the IBEX 55 reported shareholder protests over executive pay, compared with 33 per cent of companies last year.
With the local AGM season on the horizon, it’s something for Australian companies to start thinking about.
Read the FT’s report on the issue here.
NO MORE CORPORATE JETS
A recent survey conducted by Bloomberg reveals that business travel may be a thing of the past.
It seems that many businesses – from Pfizer and Michelin to LG Electronics, HSBC and Deutche Bank – are considering swapping business class flights for video calls.
Bloomberg surveyed 45 large companies in the US, Europe and Asia, and found that 84 per cent plan to spend less time and money on travel post-pandemic. The reasons given? The ease and efficiency of virtual software, cost savings and lower carbon emissions.
So, good news for the environment but not so good for airlines and hotels – about 30 per cent of commercial air traffic is business related.
Read more about the survey here.
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