Can GBS pull the rabbit out of the hat in 2023?

According to the Chinese zodiac, 2023 is the year of the Rabbit. Adherents believe this is a year where the sacrifices of the past are rewarded generously, which could be a welcome break from the trials of 2022 for many of us.

The year of the Rabbit is believed to be a rewarding one for risk takers, so here are my predictions for the risks and opportunities 2023 will bring for the wider economy and the key implications for #GBS :

1)?????Change of tack in climate change: The move to net zero slows, at least temporarily, as nations move to energy self-sufficiency. Alongside this, the tech race to reduce reliance on fossil fuels gains pace, with the EU and the US battling for supremacy.

2)?????Carbon taxes widen to cover food production: related to the point on climate change, as governments around the world look for new ways to raise revenue, the next obvious candidates are “polluter pays” policies moving to meat production and processing. In the same way as sugar tax is now the norm in many countries, so too will meat tax.

3)?????#Bregret (Brexit Regret) emerges: A December 2022 YouGov poll claims just under a third of Brits think leaving the European Union was a good idea; over half think it was a mistake. Neither of the main political parties in the UK have any appetite to re-run the divisive 2016 referendum, and it is unlikely that the EU would want to welcome Britain back on terms the British would accept. The calls for another referendum will fall on deaf ears.

4)?????OECD targets low tax jurisdictions: In October 2021, the OECD brokered a deal amongst the international community that established a global minimum effective corporate tax rate of 15%. The next logical step is for the OECD to target corporate acquisitions in OECD countries, such that deals cannot be made with capital arriving from specific “tax haven”, which would likely be UK offshore protectorates, and only from jurisdictions adopting OECD transparency standards on capital, which would include the automatic exchange of information, beneficial ownership registration and local reporting. This could destroy private equity deals, mainly in the City of London.

5)?????Europe seeks life after NATO: The relationship between the US and Europe within NATO has been tense since President Trump. Some politicians advocate an EU army is to protect Europe’s borders, which may mean a change in the US’s role as global policeman, something that Biden would not welcome.

What does this mean for Global Business Services?

These factors accelerate two trends already in evidence in GBS design:

1)?????An enhanced focus on #ESG , to attract and retain both employees and clients based on a company’s record on climate change and broader ethical issues

2)?????Regional delivery centres to support global transaction processing hubs, addressing the issue of regional tensions and more protective regulations in the EU, US, and other regional trading blocks

But as we stare into the great rabbit warren of 2023, I am reminded of the sage words of one #Bugs_Bunny : “Don’t take life too seriously. you’ll never get out alive!”