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03 December 2023

The finger of blame

Peter Buffett, Dr Vincent Biruta, Emilio Ambasz and Princess Heide von Hohenzollern (right to left) at Future Capitals in Abu Dhabi Erik Arazas (SUPPLIED)

By Ryan Harrison

CEOs and chairmen have came under fire for their role in triggering the financial crisis that threatens to tip much of the world into recession.

Speakers at a summit in Abu Dhabi took particular aim at bank chiefs, who they accused of "irresponsible behaviour" and "recklessness" while handling customers' money.

The aim of the Future Capitals event was to establish which cities were set to emerge as tomorrow's world capitals. The UAE's leaders plan to put Abu Dhabi and Dubai at the top of the list.

But the country's CEOs had to take heed of the mistakes of others if this was going to be achieved, said Sam Hamdan, Chief Architect of the Future Capitals summit in Abu Dhabi, as he chaired an eclectic mix of eminent thinkers.

"Are we doing enough homework as CEOs and chairmen try to understand the direction of our investments?" he asked.

The panel of businessmen, diplomats and artists from Europe, the US and Africa agreed there were major shortcomings to be addressed.

Princess Heide von Hohenzollern, who runs a cultural centre in Germany, said: "US bankers behaved like little boys with an enormous playground – the playground being the global economy. You go and play and lose contact with the real world. What they lack is responsibility. This is the word of the year for me."

Claude Beglé, Chairman of Swiss Post, told delegates: "We've seen CEOs of banks looking to take more and more return while taking more and more risk. What has happened is like a snowball effect. One day the whole card castle had to collapse.

"Banks have collectively increased the risks to an unacceptable level and societies have failed to provide the necessary guidance. And the most risky activities – usually the most profitable – the banks did not only for their customers but for their own balance sheets."

Another speaker, Peter Buffett, son of business tycoon Warren Buffett and an Emmy Award-winning producer and composer, said the failings of financial capitals around the world had been built on unbridled greed.

"What has happened is the development of greed by relatively few," he said. "What's been created through the values in our education systems is probably a far cry from what people actually want. People want not to get rich but get strong."

Sheikh Nahyan bin Mubarak Al Nahyan, the UAE's Minister of Higher Education and Scientific Research, stressed the importance of accountability if Abu Dhabi was to establish a global role in the future.

"Our leaders have created an environment in which people respond to their economic and social opportunities and fulfil their responsibilities as citizens of Abu Dhabi and the UAE," he said.

The capital's prospects were outlined in the recently launched Abu Dhabi Vision 2030, a plan to transform the city over the next couple of decades.

Amid the debate about Abu Dhabi and other potential powerhouse capitals, the panel agreed that a breakdown in education had played a major role in the financial crisis.

Hector de Ruiz, Executive Chairman of technology firm AMD, said: "CEOs are going to have to take ownership of the fact that they have a role to play in education."

AMD's 50:15 campaign was established to spread the use of the internet as a tool to educate the world and the aim is to see 50 per cent global usage by 2015.

"Almost doubling usage in the last five years isn't bad," added de Ruiz. "Getting to 50 per cent by 2015, frankly, I think is possible. It requires governments and companies to back the idea that being connected to the internet is an enabler for education.

"The responsibility lies with the leaders of companies using technology. IT has done nothing wrong itself. People now realise how they could have modelled their systems to prepare for the disaster that's happened."

But de Ruiz said Abu Dhabi's efforts to become a future world capital should not be influenced by existing major capitals.

"The danger is that a lot of companies rely on what Goldman Sachs or Citigroup say in their research reports. But you have to develop your own view of what to be."