During the course of yesterday, Dentons received queries from clients around the world about what Donald Trump’s election victory means for the US, the world and their own businesses.
Following the UK’s Brexit vote, nationalist or nativist candidates winning around the world, doubts about the Trans-Pacific Partnership Trade deal in Asia and the rise of protectionist policies around the world, it is clear that Mr Trump’s unexpected victory is part of what is now globally expected and has become the defining conflict of our era: the tension between globalisation and cultural identity.
When the Berlin wall crumbled more than 25 years ago, our assumptions of a divided world fell away with it.
Much as eager East Germans rushed in newfound freedom through the new gap in the Iron Curtain, the economic and political barriers were seemingly shattered.
Reunification of East and West, most hoped, could spark unification around the globe not just of geographies, but of ideologies, cultures, and traditions.
Globalisation was the reigning buzzword. We were racing headlong toward if not one world, then certainly one that was flat enough that it could be easily traversed by world traders.
But that economic ideal is just as far from global social, political and business reality today, decades later. Much has changed. In the past, globalisation was perceived as a one-way street, from the developed to the developing world.
Now though, the rise of China, India and other emerging economies is shifting that old one-way globalisation into a new, vibrant multilateral globalisation.
Chinese, Russian and global investors search for real estate and business opportunities from Africa’s nascent economy and critical natural resources.
South America, Southeast Asia and the Middle East are both receivers and givers of foreign direct investment.
Powerful brand names in international business are under the control of Eastern, not Western economies. Talent and power are not presumed to be in the north and the west, but equally in the south and the east.
Firms from emerging nations are becoming important global investors and job creators too. In the old global economy, the giant populations of developing countries participated in the world economy mainly as workers, whereas now they are among the most sought after consumers in the world.
But there have been costs and now there is a reaction to those costs. Those costs make the global superhighway a bumpy, unsure road, and the backlash against globalisation has begun to manifest itself in many ways – most recently through political isolationism in the West.
The most demonstrative recent example of this is Brexit, and yesterday Donald Trump won the US election with a campaign slogan that promised “America First”.
Rather than being flat, this is a world where an increasing number of walls, literal and figurative, are being erected.
So how do we overcome these new barriers? Globalisation can continue to be a force for greater good in the business, humanitarian, and social worlds.
But we must not overlook the need to understand national, regional, and ethnic cultures. Companies and businesses, from the most giant multilaterals to small, local firms, all need to understand how to navigate these turbulent cultural rapids.
It will take more sophisticated and culturally attuned business leaders and advisers. When we formed Dentons, we acknowledged that companies doing serious business can no longer afford to impose one or even several dominant cultures around the world, while ignoring local values, traditions and cultures, which is why we made a strategic decision to adopt a polycentric approach so that we could be effective in multiple and varied markets.
Lawyers are the tradesmen and women of globalization, and our job is to advise clients on how to navigate the rising and falling walls in conducting global business today.
This article was written by Dentons global chairman Joe Andrew.
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