David Aikman on visualizing the 'Customers of the future' in any business around the world

Hello and welcome to the Rich Robinson Show. I'm your host, Rich Robinson. Over the past 25 years, I've been an entrepreneur, investor, advisor, and professor here in Asia. After nearly a quarter of a century in China, I'm now based here in Bali, Indonesia, the island of the gods.

Asia is my home now.

60% of the world's population also lives here, but I would contend 80% of the world's dynamism and opportunity is right here in the region. On the show, you'll hear candid and fun conversations with some of my friends and colleagues, people I've met along my journey, entrepreneurs, operators, experts that will help you unlock actionable insights around the Asia region. And the entrepreneurial agility that actually defines it. This first season, season 1 of The Rich Robinson Show, is titled At the Speed of China. Like, wait for it, at the speed of light. Things happen fast in China, and in this season 1, we're gonna take a deeper look at that. The rapid economic development over the past few decades, As well as the speed and cycles of innovation taking place all day, every day right now. Let's go, Jio!

David Eichmann, ladies and gentlemen. Welcome to the pod. Pleasure to see you again, my friend. Right now you're in Beijing.

That's right. That's right. Good to see you, Rich.

Yeah, you as well. Beijing to Bali. David Eichmann running the esteemed, amazing institution World Economic Forum for the Middle Kingdom, for China, and had really fascinating journey to that career path. And would love to just jump right in and hear about, hear about your journey to the Middle Kingdom, your sojourn and adventures along the way. And then let's dig into your role at World Economic Forum and some of your insights on the speed of China. So let's go back to the origin story.

Well, I actually feel like China is like this long, finally requited love affair. Because I first studied Mandarin when I was like 17 years old. I got a chance to study Mandarin as part of my International Baccalaureate. And then after university, one of the options I was looking at was coming to China to teach English. It was a great program and it was really appealing to me since I did my degree in literature. But then this opportunity came up to go to Switzerland and to do a year-long internship for the Olympics. And I thought, well, China will always be there, right? But this chance at the Olympics, I might never get it. And so I went to the Olympics for a 1-year internship and turned into a 7, 8-year career. And then—

What year was that? Which Olympics?

It was the 1996 Olympics. So I was with the International Olympic Committee based in Switzerland and then did a number of Olympic Games, '96 through 2002. So I started and finished with the Salt Lake. That's great.

Remind us of the 4 cities along the way.

Yeah. So along the way it was Atlanta, then the Nagano Winter Olympics, the Sydney Olympics, and then the Salt Lake City Olympics. So it was a great run. Those were fantastic games. And actually my last assignment with the International Olympic Committee in 2001 was coming over to China to help set up the organizing committee and train up the marketing team to learn about intellectual property rights and the Olympic rings and how we would market the program and sponsorship.

Yeah.

So then I felt like, okay, no, I get my chance to be in China, but I was just visiting. And it wasn't until many years later, about 6 years ago, when after a very long career at the World Economic Forum doing lots of different things, including running the Commercial Partnership Program, my boss, the founder and executive chairman of the forum, said, David, would you go and head up the China office? And I thought, finally, I get a chance to live in the Middle Kingdom. I get a chance to live in Beijing. And of course, between 2002, I guess was the last time I was here, and 2015 when we moved here, What a change! Those little trees that I saw them planting by the airport had now grown into a huge forest, and so it's great to see the trees grow faster. But you know, it's yeah.

I remember they were actually spray painting some lawns. I remember to make it green for when the Olympic Committee was coming over to choose whether Beijing was going to be the spot, right?

And that's right.

Yeah, pulled out all the stops. Incredible. Wow. Yeah. Tell us about some adventures along the way and the Olympic Committee. Some of the things that you did there and some well, you know, I mean, I think let's focus in on China.

I mean, it's it was. Really fascinating to be here at that time because this was a time when China had just gotten into the WTO, and a time when the company was country was really really not just at the governance level and the government level opening up, but really like people across China just were so excited to engage with the rest of the world. And everybody saw the Olympics as like China's coming out party, the debutante ball or something like finally China was coming onto the world scene. And so while the WTO accession was really important to the economy. And to the leadership of the country, the hearts and minds of the country were really enamored with the Olympics and everything that represented and welcoming the world here. It was just a wonderful time to be here and to be working with China and to see all the hope. And I remember talking to some of the young English-speaking MBAs that they'd hired to work on the marketing team, and we were sitting in a restaurant and I asked my young colleague why he was so positive, because I said, in Europe in 2000, 2002, People were kind of cynical and not really excited about the future.

It's cool to be cynical.

And I said to him, why are you so positive? And he said, David, right now, when I grew up, we were lucky to have a little bit of protein as part of the meal. Times were really tough. My family was very poor, but here I am sitting with you in a restaurant where it used to only be the like senior party members who used to be able to eat here. This was unattainable. When I was growing up, learning English was a phenomenal opportunity, but I never thought I'd have the chance to sit here. and talked with someone from International Olympic Committee and couldn't imagine this. He said, if all this change, all this opening up, if all this economic development can happen in my lifetime, and he was only 28 years old or 30 years old, said, what does the future hold? Must be even more incredible. And indeed, I mean, if you look at the transformation that's happened even in the last 15 years since I had that conversation, or 20 years since I had that conversation with him, the country has changed even more and the pace of change and innovation has accelerated even, even exponentially. And so I think there's a real different sense of time and opportunity when I talk to Chinese friends and colleagues compared to when I talk to Western friends and colleagues. There's just a completely different notion here of the ability to get things done, the speed at which things can get done, and the potential of the future, the positive potential of the future. I mean, it's really, really quite incredible and stark.

Yeah. And I'm glad you shared that. And yeah, sure. People can say, well, 20 years ago it was closer, it was Just about almost as close to Mao as it is to now, right? So of course somebody would be kind of breathless and like, gee whiz, look at me in this restaurant and everything is awesome. But that optimism, and I don't think that's something that people understand in the West, that sort of positivity and optimism and sort of outlook to the future that my life is gonna be better, much better than my parents. Like that's quite pervasive.

Yes.

In a lot of urban China.

Yeah.

And I think that, that mindset is a big part of the speed of China, right? I don't think people necessarily do things very efficiently or speedily when they're feeling sort of pessimistic and cynical necessarily. Right. And I think part of that is like the purpose of the book is like that Sputnik moment in the '60s when it's like, wow, or '50s, '60s, it's like, there's this race with Russia and like, we better bring our A-game and we better really step it up. Right. And I think that's really the purpose of this book is not just a kind of breathless gee whiz, look what's— look how fast things are happening in China for better or worse. It's like, hey, you know what? This is great that this is happening in China. And this is like an honest assessment of what's really going on in China. And like everybody should be aware of it and everybody should really step up and bring their A-games as well too.

I think any individual or company who's not factoring in China into their strategy or into their life plan is, I think, Going to be very surprised because it's almost— I know a lot of people talk about the sort of the frog in boiling water or whatever, that you don't sense the change until it's suddenly upon you. But I do sense that that's the case here and living here and working here, getting to interact with a lot of different leaders. I see all these things which are maybe beneath the surface or not necessarily visible to people outside of the country. And I think it's going to be a really shocking wake-up call. When that stuff suddenly does become visible and you realize that the economic power or the innovation capacity that the country has and that it's quietly and quickly left the rest of the world behind. So I think even if your business is not selling to China or you don't think that your services are going to be in demand in China, you still have to factor China into your strategy and your equation because they will be, I don't mean to sound scary, but they'll be coming for you in a sense that they're going to drink your milkshake.

Sure.

Yeah. And the speed of change, one of the things that Impresses me here is really around the innovation capacity, which is innovating at all levels of development at the same time. So one of the things about China is it's either a very rich country with a lot of poor people, or it's a poor country with a lot of rich people. It depends on which way you look at it. But you have every phase of development existing simultaneously, right? So you have regions where people have just come out of poverty, living on just over a dollar fifty a day, and you've got very, very affluent wealthy cities, and you've got Chinese companies. that are catering to those customers at all levels of development. You've got Chinese technology, which is being deployed to all levels of development. And that means that from my perspective, if you're an entrepreneur in China, if you're a tech company in China, it's very easy for you to move into developing markets and really underdeveloped markets because you have that own experience from China. Now you're going to have to overlay different culture, different laws and so on, but The cost model for delivering to very poor rural villages is not going to be so different between very poor rural China and rural Southeast Asia, rural Africa, rural Latin America. And so the Chinese companies have an advantage in the sense that they've developed business models and innovation capacity to reach those poorest parts of the country while at the same time still being able to serve the most developed sides. And it's a lot easier in my mind For a Chinese company to make that move than it might be for a European or an American company that have only really dealt with developed markets. So their their their their whole business model doesn't very very difficult to adapt Western European business model to the poorest parts of Africa or the developing countries in Southeast Asia. So really think that again, even if your your market you're just focused on let's say the European market, the Chinese companies are going to. Take the rest of the pie. They're going to take the rest of the world. And so you will at some point have to deal with them as competitors or collaborators and so on. So I really just encourage everybody that I talk to, to sort of sit down and try to understand what's going on here, even though it's a challenge from the outside, even though sometimes it seems very, very confusing and impenetrable, but it's really worth the investment. And I came to China feeling like I knew nothing. 6 years on, I still feel like I know nothing, but I've been studying even less. I've been, I've been studying a lot, but I think it's been a really valuable experience to try and sort of get under the skin of the Chinese entrepreneurs and understand what the leaders are thinking about and really try to walk a mile in their shoes and understand why it is the way they say certain things or they foster certain things in the media or why entrepreneurs behave certain ways or make certain decisions. That's just really helpful, I think, for everyone to try and understand.

Yeah. As comedian Billy Connolly says, You should always walk a mile in a man's shoes because now you're a mile away from him and now you have his shoes and what can he do? But I really, there's a lot to peel back there. That's terrific. Yeah. I certainly encourage people to, yeah, to come in and like, like smell the innovation ecosystem in China and all the different layers, all the different stakeholders in that. As an entrepreneur in China, I remember my team developing a product and then calling somebody in their home village. And asking them to test it out using their phone that it's not as good and using bandwidth that is not as good. And instead of in tier 1 city of Beijing with the newest iPhone to be able to test the app out and go, works great, right? And people are like, wow, it's too slow. It's sluggish on my phone. It's a really big download. I think that's something that China has access to tier 1, 2, 3, 4, 5 cities, all within the same infrastructure. And, you know, there's what, 4 billion people out of, you know, say 8 billion on the internet now. And we're going to add another 4 billion on the planet before maybe the population stabilizes or shrinks. So there's probably another 4 billion people coming online across Africa, Latin America, the rest of Asia. And who's popping up those new users? And it's a battle between Silicon Valley and China mostly, right? Silicon Valley, Beijing more specifically. I think China has some Added advantages in that. And then certainly with the innovator's dilemma, you go over the lower end of the market that's not as attractive, but then as that market grows, then you've already captured it.

Absolutely.

Really difficult to grab it back.

Wow.

So tell our listeners about the World Economic Forum. I mean, a lot of people would know it through the incredible event that you put on in Davos, and then you also have the one in Elian as well too, and others around the world. But it's so much richer and deeper. What's the mission? How has that mission been manifested in China?

Well, so it's a funny thing because we've got very high brand awareness. Everybody knows about Davos and the annual meeting of the World Economic Forum where the great and the beautiful and the leaders come together. But that's, it's really not what we do and not what we're about. It's really the tip of the iceberg. And I liken it, you can imagine from my background, but I liken it to the Olympic Games in some ways because the Olympic Games are this wonderful celebration where everyone comes together and competes and lives in the Olympic Village as one global family.

Yeah.

But throughout the year in 200 countries and territories around the world, athletes are training every day, every year to try and get that opportunity to go to the Olympic Games. And in a similar way, Davos and the annual meeting for us is the pinnacle of what we do. It's where we showcase the work. But in fact, throughout the year, there are working groups of NGO leaders, business leaders, government leaders working together on key problems. And trying to push those forward, trying to make the world a better place, literally. And then they come and they report it at the annual meeting. And we use that kind of as the forcing mechanism to keep people honest and to say, hey, you got to deliver some results by next January. But we're a non-for-profit foundation. Our mission is to improve the state of the world. And we have a, just a fundamental belief that you can't solve the big problems facing this world, whether it's a pandemic, whether it's climate change, whether it's just lifting people out of poverty, you can't do that unless business and government and NGOs are working together because you need the entrepreneurship, you need the dynamism, but you need that business and that entrepreneurship to be working for a greater good than just the bottom line profit. And likewise, you need the government to set the good regulations and the framework, but they also need to move at the speed of business. They need to think about more than just the next election cycle. And you need the NGOs in there to keep people honest and accountable. So we really feel that by bringing these different groups of society together, we can get a better, better outcome. And having participated in the organization and those annual meetings for a long time now, almost 10 years, I really am impressed with the caliber of leaders who are there. I really believe that they are working for something bigger than themselves.

And I've been really impressed with that enlightened spirit that they're trying. It's not perfect, but there's something a little bit extra in— I think maybe it's part of the Davos, but it feels, it doesn't feel like an NGO. It has a dynamism about it. Because I think sometimes NGOs tend to be a little bit more like, this is comfy and I'm doing something that's maybe a little more stable, but I get the feeling there is this sort of like drive inside of— where does that come from? Like, what's the DNA of that? How does that—

I think it comes from the fact that as an organization, our visible product, if you will, is those meetings. I remember once talking with chairman of a big Swiss chocolate or food company. We were talking about the differences between the World Economic Forum and his company. When you're in the food business, especially the chocolate business, you want to make a chocolate bar taste the same everywhere in the world. And every single chocolate bar should be the same. You want to bring the cost down. You want to manage the quality, but pretty much—

You got to make sure those Oompa Loompas are not getting drunk and like trashing the place.

Exactly. But for us, I mean, can you imagine if you went to the World Economic Forum and everybody was like, oh, this is the same thing we discussed last year. It's completely different. It's kind of like going to a Michelin star restaurant where you're going to have an experience. You're expecting to be wowed and you taste the same menu you tasted last time you came. So we have to continuously reinvent ourselves. And more importantly, I mean, our relevance is grounded in the current affairs of the world. I remember a number of years ago, we had the program for the annual meeting all set. Everything was ready, all the speakers confirmed. And then the tsunami hit Southeast Asia. Yeah. And it was devastating.

Of course.

And you can't then say, oh, I'm sorry, our program's set. We're not gonna talk about this catastrophe, which has happened. No, we threw everything out and we started over again. We said, okay, what is this showing us about extreme weather events and climate risk? And, you know, how do we make, bring this home to the leaders so that they start doing something? How do we mobilize support and solidarity for the poor people who've been affected by this? You know, how do we use this, our opportunity to mobilize the corporate sector to help out in places like Sri Lanka and elsewhere. So I think it's sort of endemic.

That's a terrific example. Yeah.

So the nature of the organization that we have to be sort of grounded in the current events, but our goal is to always lift the minds of leaders out of their quarterly events, out of their 4-year election cycle, and really look down the road and say, look, there are some big problems facing the world and climate change, for example, pandemics. We've been talking about the possibility of this kind of thing happening For years. And unfortunately, people weren't really listening. I mean, they weren't doing the preparedness necessary. It's been a similar thing with climate change, although again, now people seem to be listening. There seems to be money flowing into climate change and mitigation. So we're really encouraged by that, but it's kind of— you gotta keep pushing people to think long-term. Unfortunately, that's hard to do when you're a leader confronted by the immediate. And I would say that's even more true here in China where the pace of change is so quick. Mm-hmm. It's hard to get CEOs and leaders to, especially in the corporate side. I think it's easier on the government side here in China. There's a bit of long-term 5-year plans and so on. But in the business world, it's quite challenging to say, look, as a CEO, you should be thinking about ESG, environment, society, and governance issues. I'm very encouraged that they are, but, but it's been a bit of a tough sell because in China, things move so quickly. It's hard to make a strategy that's a year out.

Yeah, good point. Yeah. And of course there are downsides to speed as well too, right? I mean, some people getting overworked and short-term thinking and others, but on balance, you know, Elon Musk once tweeted that at the end of the day, the only thing that matters is the pace of innovation. And that really is those experimental cycles just happening faster. Tell me about some of the experiments you did in China.

But I want to pick up on that point because I think what you raised there, Rich, is really, really fundamental that in China, there's, I think there's 2 advantages that they have. So one is the fact that there's not necessarily legacy systems and legacy infrastructure that have to be undone. So in some ways there's, there's no vested interest, right? I mean, you think about the fact that in the United States, you can still pay with a paper check. That's incredible. There's a whole infrastructure to pay with checks and credit cards. Whereas in China, you never had credit cards. I mean, credit cards didn't catch on.

Never mind checks. Yeah.

Never mind paper checks. And so you can go completely from cash to digital with no Legacy infrastructures that need to be undone. Now, as a result of that, because the pace of change has been so quick, the consumer in China is really willing to go along with that change. So they're willing to accept that product which is still in beta because it's bringing a positive change. It's bringing some simplicity or some advantage to their life. And then that innovation cycle is happening so quickly because you've got literally millions. maybe even billion, over a billion users on something that you can then quickly do the next iteration. So that same iteration cycle that you see in Silicon Valley, that you see in startups, you've got that happening on a national scale with a set of consumers who are bought into that notion of change. Like they're almost bored if you haven't released another version.

There's like pull from the market in a way.

Exactly. Which is, I think, again, different to the West where the West is sort of a little bit more resistant to change. We're like, oh, are you You gotta buy another iPhone? Like, it's already out of date or whatever. And whereas here, people are really looking forward to that because they've seen the incremental benefit to their life in terms of that product or service that has come very quickly. You look at the pace of adoption, things like shared bikes or other services. I remember when there was nothing. I remember when there were millions upon millions of bikes and now it's sort of come down to a normal, come down to a normal level.

Nice.

But still, that willingness to adopt new technologies and new models of behavior is something really incredible. I mean, the Chinese people are incredibly adaptable and open-minded to that possibility. I mean, it's really a pragmatic approach. And so I think those 2 things really contribute to what you're calling the speed of China. It's really this notion of the sort of frictionless ecosystems. And I see it across so many things. My favorite example of that is this ski resort that I visited for the—

Yeah, we were chatting about that. Tell us that anecdote.

Yeah. So it's a place just north of Beijing, Haikouli. And the owner, Mr. Qi, went around the world looking at all the different resorts and went to Vail and Aspen and Whistler and so on and said, what is best practice? What can we learn from this? And then created this incredible resort where, you know, as a consumer, as a tourist, you come in, you have a check-in to your hotel. You, at the same place, you can rent your gear, hire your ski instructors. And it's literally almost like a factory conveyor belt. You go down the hall collecting your gear and booking your things. Mm-hmm. And at the end you hand your skis over and they put it in the locker, which has the same key card that you have for your hotel room. So you don't need to think about anything too much. It's got the same locker numbers, the same as your room number. You pass your gear, you go up to your hotel room. The next day you come down to ski, pick up your gear, walk across maybe 10 meters or 15 meters, get on the thing. You've already got your ski pass because it's also your hotel card. And it's, it's just frictionless. And I think about the poor— I think about the poor Chinese tourist who goes to my home resort in Switzerland and they have to walk to one side of town to get their lift pass. Then they have to go down the mountain to rent their gear. Then they have to go back up to the ski school. It probably takes you a whole day to get yourself organized.

To establish yourself.

Yeah. And, you know, compared to here, what sort of took 30 minutes of check-in all in one place. And so again, coming back to that notion, I'm sure the people in my home ski resort back in Switzerland are not thinking about China, are not thinking about that user experience. But when the Chinese tourist comes and has a miserable experience in Switzerland, they're going to be like, what was all that hype? Switzerland and the Alps, it's supposed to be the best skiing in the world, but that was a really awful user experience. I'm just going to stay home in China or go to resorts that I know because it's not up to my standards. So I think everyone should be thinking about trying to understand what is the consumer of the future, whether they come from China, whether they come from Asia, and where all the emerging wealth is really coming. I mean, we really see the geo-economic power shifting from West to East. And so people should be thinking about that and not just sort of thinking about their current client. It's kind of like I grew up in Canada, so I love the hockey and Wayne Gretzky, and people asked him why he was the greatest hockey player ever. And he said, because I skate to where the puck will be, not to where it is. And I think it's that, that anticipation. And you've got to think about those things if you want to future-proof your business.

Mm-hmm.

You've got to be thinking about tomorrow's consumer, not just today's.

Great, great anecdote. Absolutely fantastic. Yeah. And I think the Chinese consumer, like not only pragmatic and quickly adaptable, like you said, with the shift in digital currency, but even now become very discerning and even demanding and like high expectations. Like I want the white glove service and I want all of that friction removed. And with the high-speed rail in China, it is absolutely a phenomenon because when I first traveled to China, It was by rail through Siberia in '93. And then I took slow rail from Beijing down to Guangzhou. And it was a rickety old train, probably from the '50s or '60s, right? This was the early '90s. And now far and away magnitude bigger than any other place in the world. And why is the rail so fast? It's like, it's because of magnetic levitation, the maglev, which reduces friction, right?

Mm-hmm.

So it's that speed isn't just about running as fast as you can and just putting in the hours and just rushing it. It's really about thinking like really thoughtfully, how do we just remove any obstacles and make things seamless? And as Chinese consumers start to get a lot more disposable income, the thesis of the book is kind of like a 4-to-1 ratio. So what happens in 4 years in the West takes a year in China. So a 20-year kind of generation can happen in a half decade. And people are probably thinking, oh, Chinese consumers, yellow hats and an umbrella and some sort of like group travel. Now, Chinese consumers are getting— Beijing has more— the most billionaires in the world are in Beijing, more than London, more than New York, as you well know, right? Shanghai is very close behind, and that buoys up the disposable income, and people are becoming much more discerning as tourists. It changes so much more rapidly. So yeah, if you're a ski resort in Switzerland or you're a resort here in Bali or wherever else, like, what are you doing to make things totally seamless and white glove service for those consumers? Yeah, that's a terrific anecdote. Yeah.

And again, it happens faster than we expect. I think your 4 to 1 ratio is right because I remember we love to holiday in the south of France and probably 6 years ago, 5 or 6 years ago, we would see those tour buses with groups. But 2 years ago or 2 and a half years ago when we were there, we saw a small group, just a family traveling with a guide, learning how to speak French, sitting there in the restaurant, learning about French culture. I mean, it's completely different kind of tourist in just 4 years. Likewise, I was recently, oh, this was maybe, you know, pre-pandemic, but So 2 years ago, I was talking to the board of one of the big French banks. And one of their board members was a, I think she might've been the foreign minister. And we were talking about China and innovation and so on. And I was talking about digital payments and the speed with which things were happening. And she said, Mr. Aikman, I think you're too positive about China. I don't think in Europe, we're not going to trust these payment systems and so on. And I said, well, do you know Galeries Lafayette, the big shopping center in Paris? And she said, of course I know it. And I said, well, how much do you think of their turnover is paid through, through Alipay and WeChat Pay? And she said, well, none, because we don't trust these payment systems. So you have to use a credit card. And I said, no, it was about 17%. And that was 2 years ago. Of course, in the meantime, tourism has fallen off a cliff and so on, but it's going to come roaring back. In 2019, that was pretty significant because the merchants realized if we want to sell and make it easy and seamless and frictionless for the Chinese consumers, let's accept Alipay in the Louis Vuitton shop or whatever. Yeah.

And like that 17% was probably very high margin, very like premium, even for that shopping More, right? Yeah. Wow.

Yeah. So even if you're not really focused on China, it's gonna come. You're gonna have to deal with it somehow.

Fascinating. And tell me some of the some of the wins or projects that you've done in China with World Economic Forum that you think are notable. I think what's interesting is not necessarily about the speed of China, but just give us a little overview of like your good work over the last decade.

Maybe maybe one thing. I mean, the journey we've been on is quite interesting, and maybe. Helpful anecdote for other organizations thinking about China. We are lucky to have a long, long history with the country because back when our founder and executive chairman saw what was happening in China back in 1979 with Deng Xiaoping and the reform and opening up, he actually sent him a letter and invited him to come to Davos to the annual meeting to share with the world.

Oh, excellent. Oh, I didn't know that.

Now, now, of course he didn't come. I mean, that was probably too early in the process, but they did invite him to come and tour around China and to see for himself what was happening. And so he came in, in 1980 and we organized our first meeting of international CEOs in 1981. And my colleagues from the time talk about the multi-day journey to get here because it wasn't well connected. They had to stop in India and then get on another plane. So it was really like a 2.5 or 3-day trip to get here. They had to come with suitcases full of money that they could convert to do all of the local payment and so on. And so this was. Very much our modality. And I think the way a lot of organizations and companies were thinking about China, which was let us bring our international expertise to help with China and the reform and opening up. And that was really the sort of the modus operandi until the early 2000s, when as an organization, we realized that the story was changing. And part of it was exactly what I was describing about your future clients. Premier Wen had come to Davos And he was talking to our organization about the ambition that China had to have more Chinese companies on the Fortune 500. And there was sort of maybe 1 or 2 at the time. And he said, oh, but we have a plan that in 10 years' time, we'll have 30 or 40. Now today they probably have 60 or 70. But when my chairman heard that, he thought exactly that, oh, our future is going to be the big Chinese companies, not The big Western companies. And so we moved quickly to change the focus of what we were doing in China to be focused on China's going global. So Chinese companies going out. And so that's when we created our second biggest meeting here, the annual meeting of the new champions. So to really focus on—

What year was that?

The first one was in 2005. Well, we opened our office in 2005 and we had the first meeting in 2007.

In Dalian.

Yeah, exactly. And so the idea was really to showcase China's innovation, China's entrepreneurship, and these sort of new Chinese champions going global.

But even that, like, that was really prescient, like pre-Olympics, like that time for a non-governmental organization to be able to be that nimble and to really smell that in the future. That's pretty terrific. And that's really become absolute just cornerstone foundational event.

What's been interesting has been over the last 2 years, 18 months with the pandemic, it's been very difficult for people to come and go to China, as you, as you well know. And so We found a lot of our international companies were coming to me and saying, David, we sort of don't have the same channels of communication that we used to. Can the World Economic Forum help us? We desperately want dialogue. We desperately want to work. China is such an important market for us. It's such an important source of innovation. And so what we've started doing over the last 18 months has been, again, not only focusing on China going out, but also focusing on how do we build bridges and how do we help create the dialogue and understanding. So we've done a number of sort of policy roundtables where we try to bring the international companies in and help them understand what Chinese leaders are thinking. You've got this thing called the dual circulation policy, which is causing a lot of anxiety, companies feeling like they might be shut out, but they got to sit with the government and hear how, you know, if you're a European company who's been here for 100 years, you are part of the domestic circulation. And so it's sort of like reassuring that they still want the investment. They still want to grow the domestic market, but that engine has to be turning in some ways. Independent of the trade and the external because the external market has become so unpredictable and volatile. So you are seeing sort of a bifurcation of the system within China. So it's been interesting that we've now again had to reinvent ourselves a little bit. And so I've been very proud of the way the team has really pivoted and been able to adapt to the changing need from both our international companies and our local companies. And then in terms of helping the local companies have dialogue and improve relations with the West, It's been really interesting that the thing that we've focused in on is the whole ESG reporting. So environment, society, and governance, which is very, very popular and important in the West right now. And what's interesting, it's still nascent in China, but what's been interesting is that there's actually a lot that Chinese companies are doing. So now, of course, with the new targets for being reaching peak carbon in 2030 and becoming net zero carbon in 2060, all the companies have to think about their climate impact and their environment So in fact, but in fact, many of them have been thinking about clean energy and water for some time because they're looking at it again from a pragmatic level of how do we reduce our costs? How do we, and then many, many Chinese companies are actively involved in social programs because they've, they've understood the government's priority to eradicate poverty. So they want to do their own corporate initiatives to see how they can help. There's been tremendous things around empowering and educating rural girls and women and so on. So the companies have been doing all that, but they haven't been getting any credit because they don't really talk about it. They're quite humble about what they do. And so we got a group of about 25 Chinese company CEOs together and said, look, why don't you guys become the champions for this ESG reporting in China? And why don't you work to showcase and know you're not perfect, but you can show where you are on the journey using that framework, which is being used by the West, gives you a way to talk to investors, gives you a way to talk to the media. In language that they understand, in frameworks that they understand. And so there's been tremendous momentum behind that. I've been really, really proud to see that develop because I think it opens up a new vector of communication, opens up a new way of having a dialogue between East and West, which I think is really positive because there is great work and Chinese companies should be lauded for what they're doing. And I think by encouraging them in a positive sense, we'll get to see even more, more commitments and even action on the ground here. And great, you know, encouraging signs. I mean, Hong Kong already has very strong listing rules on that. The mainland China stock exchanges, Shenzhen and Shanghai, are probably going to release similar rules this year. So this kind of ESG reporting is going to become mandatory. And the companies who get that and understand— the Chinese companies who understand that now are going to get really a positive boost in the market and reward for that investment now.

So that's great. Yeah. And even if my perception was that it is a nascent area, it's Even nascent things in China go from diapers to acne to adulthood pretty quickly, right?

So— Exactly. No, this one's been moving pretty quickly. I've been really excited to see it happen. Wow.

Excellent. Terrific. Hey, David, that was excellent. I really appreciate you carving out the time.

My pleasure.

I love, you know, your energy and what you've— impact that you've made and the organization has made and look forward to seeing more, more good stuff from you. Thanks again.

All right.

My pleasure.

Thanks a lot, Rich.

That was great.

You're awesome.

That's a wrap.

Thanks for listening to this episode of The Rich Robinson Show, Season 1, At the Speed of China. Visit therichrobinson.com/show to smash that subscribe button. Please also go to iTunes or whatever platform of choice, rate and comment. And until next time, thank you very much. Zaijian.

Cheers, y'all.