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Lack of governance behind crisis: Nooyi

Indra Nooyi, PepsiCo chairperson and CEO on Thursday blamed leadership and lack of governance for the financial crisis that roiled the global economy as “accountability and oversight went missing.”

business Updated: Nov 03, 2011 21:57 IST
HT Correspondent

Indra Nooyi, PepsiCo chairperson and CEO on Thursday blamed leadership and lack of governance for the financial crisis that roiled the global economy as “accountability and oversight went missing.”

“Nobody said stop when bad practice was developing. Governance failed and it failed badly. The result of poor leadership and even worse governance is that we are now experiencing a severe crisis of expectations,” Nooyi said addressing the Hindustan Times-Mint valedictory speech at Ad Asia 2011.

“At the top of some famous companies, responsibility went missing. One of the great tasks of leadership is to be ready when the storm comes. On any measure, leadership failed that test,” she said.

The financial meltdown brought the easy assumptions of the old world crashing down. Housing markets collapsed, unemployment levels soared, retirement accounts vapourised. Institutions, from banking to automotives, peered over the brink. Famous household brands just disappeared altogether.

Yet, she said the world should be careful not to fall into pessimism. “This is also a world abundant in opportunity, if we know how to navigate it. The global economy, which is $62 trillion today, is likely to be $300 trillion or more by 2030 and most of that growth will be powered in places like this,” Nooyi said.