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Forging our Urban Future

The Brookings Institute and ESADE present “An Economic Agenda for Cities and Metropolitan Areas” Barcelona, 8th June 2011: Across the world, the rate of urbanization is rapidly increasing. This is a good thing for the economy as cities are far more efficient generators of GDP. Yet urban growth brings with it new challenges; those of inequality, environmental sustainability, talent attraction, competitiveness. What’s more, the question of where these initiatives should come from remains unanswered and largely without a best practice model.
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Grappling with these issues and more, the one-day event held by the Brookings Institute at ESADE Business School in Barcelona this week, brought together public and private city leaders, who are working to implement new business models for their cities. Hailing from seven different metropolises, (Barcelona, Paris, Minnesota, Basel, Sao Paulo, Cape Town and Istanbul) the speakers addressed a wide range of issues on strategic urbanization, its results and challenges. “The path to take depends on us, citizenship begins in the city” Kicking things off, Professor Javier Solana of the ESADEgeo-Center for Global Economy and Geopolitics, reminded participants that we are living in an “uneven, uncertain and unsustainable world” a world that has undergone drastic changes which would not have foreseen as recently as January of this year and a world where growth is generated by cities. Public private partnership and innovation are essential to finding solutions for better cities In his opening address, Francisco Belil, CEO of Siemens SA, considered the impact of cities, noting that although they only cover 1% of the world’s surface, they consume 75% of the world’s energy and generate 85% of the world’s greenhouse gases. Their economic importance should also not be underestimated, with output of just ten cities contributing 20% of the world GDP. He also looked at the role of efficient energy technology in attracting innovative talent through increasing the quality of life in cities. “Energy consumption is directly related to quality of life” he stated, “we must be capable of building energy efficient structures… many of the technologies needed for this already exist, but we need to implement them as soon as possible.” He highlighted the need for new disruptive technologies in this area, “innovation must shape the future” he noted. “We need to get back to basics” Dr. Joan Clos, of UN Habitat focused on the paradox of the huge number of city dwellers living in slums and the discordance caused by inequality as their neighbours enjoy the likes of balconies with swimming pools. He noted that such situations are caused by urbanisation without industrialization, a trend particularly evident in countries relying on extractive industries and agriculture. He highlighted that although huge megacities are emerging, they are not cities as we know them: a large percentage of their population is unemployed, there is no public transport and there is a great divide between the formal city and the slums. Dr. Clos called for a “back to basics” policy, where simple urban planning tools must be applied and developed by home-grown institutions. “In Europe we have forgotten about urban planning” he said, “we have lost the technology and now do urban refinement.” “We must build the economy by unleashing America’s metropolitan engines” Next up, Bruce Katz of the Brookings Institute, considered the issues facing US cities, highlighting the need for them to “re-find their

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innovation Mojo”. He described how the US still sees itself as a small-town nation despite being mostly metropolitan. Three quarters of US GDP is generated in cities and 47 states generate more than half of their GDP from cities. “We must move from a macro to metro point of view” he stated. He called for a redefinition of the US economy based on the pillars of exports, low carbon emissions and innovation. “The US must get really smart, really fast” he said, referring to innovation as the “backbone of the move from a consumption based economy to a production based economy.” Cities must understand why they are different, find their competitive advantage, nurture it and compete, not with their neighbours but with the rest of the world. The polarization of US politics has led to stagnation and solutions should not be expected to come from Washington D.C. but from the ground-up. “This has to be done the hard way by “Pragmatic Caucus” through democracy, but also using many other actors at the same time… We need to flip the federalist pyramid” he said, “business plans must be created at city levels, then states can support them, and finally the federal government can get involved.” “We need to rethink the way we look at the world” Professor Javier Santiso Academic Director of ESADEGeo put these changes within a macro contest of the shifting wealth of nations, where OECD counties no longer exclusively hold onto the world’s financial, talent or innovation resources, and South-South relations are becoming increasingly powerful. In this multi-polar panorama, cities, as key economic drivers, must work hard to attract investment and talent. “Europe needs switch from North-focused shipping infrastructure to more sustainable Southern options” Santiago Garcia Mila, Strategy and Development Deputy Managing Director of the Barcelona Port Authority looked at the changes in shipping over the last 50 years which evidence this shift in trade, through the massive reduction of transatlantic shipping and the increase in China’s output. He noted that Europe is still not ready for this shift with its largest ports based in cities in the North (such as Rotterdam and Hamburg) ready to receive goods from the Atlantic but not well positioned to deal with Eastern trade. García Mila underlined the role of the Mediterranean ports (such as Barcelona), as the most sustainable route for Eastern trade, and importantly the shortest route between Brazil and China. The panel discussion involving Vincent Gollain, Chief Economic Development Officer, Paris Region Economic Development Agency; Christophe Koellreutter, Founder and Managing Director, Metro-Basel; Hakan Kodal, President and CEO, Krea Group; Andrew Boraine, Chief Executive, Cape Town Partnership and Mayor Chris

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Coleman, City of St. Paul, Minnesota involved a lively debate on the similarities and differences between the challenges faced by the selection of very different cities. Mr. Gollain from Paris noted that his city’s biggest challenges arise from the need to reinforce competitiveness, compensate the large number of jobs lost in industry through supporting entrepreneurs, competition with emerging market cities and a need to be more sustainable. In contrast, Andrew Boraine from Cape Town, said his city was facing very different challenges: the urbanization without industrialization (mentioned previously by Mr. Clos), one of the worst Gini coefficients in the world, leading to a city plagued with drugs and poor health issues, while some members of the middle class have not even noticed the crisis; the absence of a common political agenda and too strong a focus on ad hoc events rather than proper economic strategy. Mayor Chris Coleman of St. Paul cited a lag in competitiveness as one of his once-very-innovative city’s key issues, “we came to think of South Dakota as our competition instead of South Korea.” He also noted that his city now suffers from one of the highest achievement gaps in the country. For his part, Mr. Kodal listed three main reasons for the change in Istanbul: Physical – a huge earthquake and exponential growth of the population; Economical – Turkey’s efforts to open up to the world have lead to change in the way Istanbul has been treated; and the Vision of the city – Istanbul has become the centre of the region, not just a tourist destination. Basel, in contrast, was propelled to change by its success, commented Mr. Koellreutter, “we are very small, but we have an enormous hub of brains” he said, “10% of metropolitan GDP is spent on R&D… we aim to the first Life Sciences destination.” Despite the wide array of issues propelling the need for change in these metropolitan areas, the city leaders found common ground on several key areas. One such area was the need for cities to work with private entities to drive development and innovation. Another, the need to move away from what Mr. Boraine called “a lot of churning without much traction”, that is a lot of discussion without anything getting done and linked with this, all agreed that better collaboration between the different levels of government was needed along with transparency on who should deal with what. Finally the panel called for more co-ordination between the fields of economics and urban planning, underlining that cities can no longer afford not to have a strategic plan in place. Following the questions and answers session, the closing remarks were made by the honourable Jordi Hereu, Mayor of Barcelona, who thanked the city leaders and participants for their interest in Barcelona and underlined the key role of cities going forward. The afternoon’s smaller scale events included and introduction to Barcelona’s strategic plan and the world bank’s urbanization and knowledge platform and break out workshops on green economy, entrepreneurship and talent attraction, internationalization and the modernisation of manufacturing.

Stamp of approval for MSc in Finance

ESADE Business School becomes CFA Program Partner International financial studies accreditation body, the CFA Institute has announced that ESADE Business School has been officially named a CFA Programme Partner with their MSc in Finance. This accreditation is based on an extensive assessment of the programme syllabus to ensure that it covers at least 70% of the requirements of the CFA’s Candidate Body of Knowledge. This gives MSc candidates the added assurance that following their masters, in order to pass the stringent CFA exam, at most they will have to study for the additional 30%. Of particular interest given the effects of so-called “Financial Innovation” the CFA Program includes the CFA’s ethical and professional standards and ensures that the institutions involved teach and apply them. From ESADE’s perspective becoming a CFA Programme Partner also links the school to other leading academic and professional institutions worldwide.

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Despite its launch in 2009, in the midst of the financial crisis, ESADE’s MSc in Finance immediately drew a selection of high calibre students from all over the world. Of the 41 students in the current class, 97.6% come from outside of Spain, with 20 different nationalities represented. The countries with the largest representation on the programme are Germany, France, China, Bulgaria, India, Turkey, Colombia and Italy. The English-language course is directed at recent graduates looking to give an extra dimension and impact to their financial careers. The average participant is at the very beginning of their financial career at 23 years old and with a non-too-shabby GMAT score of 670. Jaime Sabal, director of ESADE’s Master in Finance said, “Students gain a deep understanding of the fundamental tools and concepts of international finance,

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developing an integral organisational vision of the competitive environment through mastering the specialised language of world finance and the development of innovative, socially-responsible financial practices.” He continued, “It is an added bonus that they can now count on the guarantee that these studies will stand them in excellent stead for the internationally recognized CFA exams.” Students on ESADE’s MSc in Finance will now have access to CFA Institute textbooks, journals, webcasts, and other educational

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resources and also benefit from professional development events held by the CFA Society of Spain and farther afield. Borja Durán, president of CFA Spain stated, “ESADE not only has one of the strongest academic bodies, but also a reputation as one of the top European business schools helping develop leaders in the financial industry. We are convinced that ESADE students will benefit from the partnership and will become successful professionals and future CFA charterholders.”

Global Executive MBA visits Madrid

Less than a week after Spain’s credit rating downgrade, the participants of the ESADE-Georgetown Global Executive MBA arrived in Madrid this afternoon to undertake the next phase of the round-the-world programme set to give them firsthand experience of the economic crisis and recovery as well as an MBA. In this, the fifth module on the GEMBA programme, entitled Entrepreneurship and Advanced Economies, the twenty-nine participants of this unique programme will attend classes, CEO forums and company visits in Madrid and Moscow. The classes, taught by professors from Georgetown and ESADE, will give them a deeper insight into the world economy, help them to be more entre/intraprenerial, develop their cross-cultural leadership skills, in addition to introducing them to a comparative institutional analysis of the politics of international finance. Aside from time in the classroom, during their time in Madrid, the participants, who live and work all over the world, will be received by T.R.H. the Crown Prince and Princess of Spain, enjoy a lunch with former EU High Representative, Javier Solana and talks by the sub-governor of the Bank of Spain and CEO’s form Santander, Union Fenosa and Telefonica. The module will then continue next week in Moscow where they will visit Russian companies such as

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Zhostovo, SIA International and Zvezda. Yesterday, however the module got off to a relaxed start with an evening tour of the old city of Madrid and a welcome meal at a traditional restaurant, one of the several cultural activities interwoven with a week-and-a-half’s hard study. Nevertheless, with an average age of 45 and as business leaders in many different sectors, participants are used to making the most of opportunities. About the GEMBA Programme Launched in 2008, the ESADE – Georgetown Global Executive MBA programme is a joint programme run by three schools: Georgetown University’s McDonough School of Business, their Walsh School of Foreign Service and ESADE Business School. This 16 month modular based

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MBA takes participants to Bangalore, Barcelona, Buenos Aires, Madrid, Moscow, New York, Sao Paulo and Washington DC. The group of 29 participants represents some 13 different nationalities. For more information see

Javier Solana calls on ESADE MBA students to “be part of the leadership of the world”

solana mbaAddressing some 500 participants from the ESADE MBA classes of 2010 and 2011, of 46 nationalities, ESADE Professor Javier Solana, asked them to not only to concentrate on their careers, but focus also on the globalised world in which we live. “Geopolitics will be very important for your future life” he stated. In his first address as professor of ESADE, Javier Solana touched upon some of the issues that are changing the geopolitical landscape. Firstly he highlighted the transfers of power between countries and within countries post financial crisis, pointing out the changing roles of non-state actors, as well as the shift caused by population growth and the transfer of GDP, from West to East. Also on population changes, he highlighted, “By 2020, half of the population of Africa will be under the age of 18 years of age. This has massive implications for all of us. We all need to be aware of it.” “The world of today is a multipolar world without sufficient multilateralism—and this is very difficult to handle” Prof. Solana said. He went on to explain that Europe has a long history of multipolarity dealt with by war, rather than multilateralism. He continued that the creation of the EU was a positive consequence of this, but that now we must build a structure of governance that will protect peace throughout the world. Prof. Solana called for global solutions to global problems, a profound change in mindset and the involvement of all new countries in world governance. “The G7 and G8 are obsolete, it is important to change the structure of governance to better reflect reality.” He noted that the institutions created post-war, particularly the IMF, World Bank and the WTO must be transformed. “Brazil, China, India, etc must be incorporated” he said, “it makes no sense, for example, for Belgium to have the same number of votes in the IMF, as China.” Focusing on the key challenges for the future Prof. Solana first discussed poverty. “It is true that globalization has produced many benefits for many people.” he stated, “in China, a vast number of people, more than the entire population of the US have risen out of poverty in the past three decades, large parts of the country still lives below the breadline … Do not forget that poverty is not only unacceptable, but will become a source of instability for everyone in the future: we need to solve the issue.” He advised. The second fundamental problem Prof. Solana highlighted is the proliferation of Weapons of Mass Destruction. “Iranian President Mahmoud Ahmadinejad’s 20% uranium enrichment program will cause difficult consequences for the region and the world” he noted. The other major issue he pointed out was climate change. “This is a real and extreme problem” he began, “we have to organize the world in such a manner that every country is willing to do its part to cut CO2, it is not enough for a

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few to try… we must see how we can solve this problem today, not tomorrow. It will only get worse. We mustn’t stifle China’s and India’s development with these measures, but we must cut CO2 emissions.” He called for “Responsible Sovereignty” noting that states cannot just do what they want in this arena. Following Prof. Solana’s address, Dean of ESADE Business School, Alfons Sauquet opened the floor to questions. An MBA participant from Nigeria got the ball rolling by asking about Prof. Solana’s views on terrorism. “It is an important challenge we must all be aware of” Prof. Solana responded, “Terrorism is never acceptable. We must combat terrorism and also look into the reasons that make someone becomes a terrorist.” Other questions focused on Chavez, the current situation in Israel and Palestine, the future of developmental aid, the role of the IMF, the accession of Turkey to the EU and the role of China in the coming decades, among others. Concluding Prof. Solana said “Carry these ideas close to your minds and hearts. It is people like you and institutions like ESADE who can make a difference, we are global citizens, we must engage and commit to the problems of the world at large. There are many, but there are also many solutions. I hope you will be part of these solutions.”

ESADE Ranked in Top Ten schools for Executive Education in Latin America by Ámerica Economía

Buenos airesFor the second year running, prestigious Latin American business magazine, Ámerica Economía has ranked ESADE Business School number ten in the world for Executive Education in Latin America. ESADE is one of only three schools founded outside of the region to make the top ten. ESADE has shown a firm commitment to the region, with the opening of their campus in Buenos Aires, Argentina in 2004 and the setting up of a Global Center in São Paulo, Brazil earlier this year. ESADE Buenos Aires offers a range of executive education programmes, encompassing both open and in-company. In this latest evaluation ESADE is ranked number one in terms of clients. This criteria particularly considers the size and importance of schools’ Latin American clients and the loyalty of these clients. At a time when competition in executive education is fierce, this result highlights the quality of ESADE’s programmes. Corporate Universities also form an important part of ESADE’s presence in Latin America. The school, whose clients include Telefónica, Santander and Repsol YPF works closely with these companies to design programmes which are perfectly integrated into their strategy and are taught around the world, particularly in Latin America. ESADE hosts an annual conference on Corporate Universities and is one of the few business schools to have fully embraced this change in direction in executive education. “In open and custom programmes we work hard to meet clients’ expectations, designing courses that fit their needs and are flexible enough to adapt to new realities as they emerge.” Comments Alejandro Bernhardt, Director of ESADE’s Buenos Aires campus. ESADE’s new range of month-long programmes, “Executive Education for Times of Crisis” is an example of this. Participants choose whether to focus on

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Leadership, Entrepreneurship, Human Resources or Creativity and Innovation. Other programmes offered by ESADE in Latin America include ESADE’s well reputed Global Executive MBA (GEMBA) program, run

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in conjunction with Georgetown University, which holds one of its six two-week modules in Argentina and Brazil and ESADE’s Advanced Management Programme offered in Buenos Aires, Campinas, Curitiba and Montevideo. ESADE also boasts an impressive international network and has alumni chapters in Argentina, Brazil, Chile, Colombia, Costa Rica, Peru, Ecuador, Mexico, and Venezuela. For more information on the new ranking see