Corporate leaders must build international organizations to compete in today's economy and be prepared to defend globalization at home, according to Klaus Kleinfeld, chief executive of the German electrical and engineering conglomerate Siemens AG.
Speaking at a recent Wharton Leadership Lecture, Kleinfeld said U.S. concerns about the sale of port assets to a Dubai-based firm, and French resistance to the sale of yogurt-maker Danone -- which French officials called a "national treasure" -- highlight growing fears that globalization comes at the cost of jobs in developed countries. Those fears could spark a backlash against globalism and limit future economic growth, he warned. "The common people -- the voters -- do not understand what's going on and see a threat," said Kleinfeld. "We, as leaders, need to be responsible for explaining the positives of globalization."
Siemens, with sales last year of $91.5 billion and locations in 190 countries, operates a range of businesses, including power, transportation, automation and controls, healthcare, lighting, and building technology. Germany, where Siemens operates out of joint headquarters in Munich and Berlin, has benefited as a net exporter in an increasingly global economy, Kleinfeld suggested. "But people do not connect the dots. Business needs to do the explaining more than ever before. If we don't, in a democracy things swing according to what the common man thinks -- and that's scary."
Siemens was a pioneer in extending the German workweek from 35 hours to 40, with no additional pay, in 2004. Unions grudgingly agreed after the company threatened to move plants to Hungary. This spring, unions have targeted Siemens and DaimlerChrysler AG for strikes this year by workers seeking a 5% pay increase.
At 48, Kleinfeld, is a marathon runner who is viewed as a youthful and outspoken business leader in Germany and a person who is in touch with American business culture after a three-year stint in Siemens' U.
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