1/20/23, 10:13 PM Asia’s top CEOs embrace change with boldness and resilience | McKinsey

Asia’s top CEOs embrace change with

By Gautam Kumra and Joydeep Sengupta
boldness and resilience
Asia’s top business leaders are navigating today’s
January 13, 2023 | Article

shocks with bold moves and a determination toward

building sustainable and inclusive growth.

2
022 was a turbulent year, with geopolitical tension, financial-
market volatility, inflationary recession, and food and energy
shortages as a result of the war in Ukraine and the COVID-19
pandemic. Today, the world may stand at a cusp of a new era ,
characterized by serious supply-side challenges amid a shifting
geopolitical landscape.

In Asia, the ripple effects of these global events, alongside the

slowdown in the Chinese economy, disruptive demographic trends,
and climate change, will likely have profound impact. Economic
growth in the region slowed down in 2022, and is expected to remain
subdued in 2023.[ 1 ] Climate change continues to have devastating
effects, with droughts in China, floods in Pakistan, and India
witnessing an extreme weather event almost every day for the first
nine months of 2022.[ 2 ] Aging populations, particularly in East and

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Southeast Asia, risk exacerbating these economic challenges with

slower labor force growth.

Even as the world becomes more complex, humanity continues its

forward progress as today’s leaders focus on building resilience—
including geopolitical resilience —to weather these storms. Indeed,
the best leaders and companies today opt to play both offense and
defense. They follow a defensive approach and protect their
downside risks, but they also capitalize on new opportunities to
generate upside, showing both strategic courage and long-term
vision.

“It is the nature of crises that they don’t send a ‘save the date’
notification; you never know they’re coming. If you knew they were
coming, you could have planned for it, and it wouldn’t be a crisis,”
said Anna Bligh, CEO of the Australian Banking Association, a group
composed of 20 participating banks. “You [also] won’t know if it’s a
one-day crisis or a 15-day crisis or more. So, if you assume the
responsibility of leadership, then that brings with it a responsibility to
make sure you are always ready to be on.”

In reevaluating their business strategies, Asia’s top CEOs are also

redefining what it means to be a leader. Instead of being in a wait-
and-watch mode and letting the crises pass, they lean into the
volatility and find new opportunities. There is a sense of
determination and purpose in their decision making. At the same
time, they are equally willing to learn, unlearn, and embrace change.

“The world is becoming more complex. Leaders need to have the

mindset that they are constantly in flux. They have to keep
reinventing to be relevant to the new world,” said Loh Chin Hua, chief
executive of Singaporean conglomerate Keppel. Throughout Asia,
examples abound of business leaders who are reinventing their
organizations—and their own professional journeys along the way. In
2022, we spoke with many current and former CEOs to delve deeper

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into this changing face of leadership. Based on our Leading Asia and
India Ahead interview series, we spotted three shifts under way in
how leaders are building their businesses in the region. They include
the following:

delivering sustainable and inclusive growth with technology

creating dynamic, inclusive, and resilient cultures

adopting a growth and learning leadership mindset

Delivering sustainable and inclusive

growth with technology

Asia, like the rest of the world, is witnessing an acceleration toward a

more digital economy, but the progress is not uniform. Countries
such as China and Singapore, among others, have advanced digital
transformation capacity, but other developing countries in South and
Southwest Asia are lagging behind.[ 3 ] As countries strengthen their
digital infrastructure and embrace new technologies, entrepreneurial
business leaders are harnessing these opportunities to change
people’s lives and address crucial societal challenges.

Video

Infosys’s Nandan Nilekani on how India’s global rollout of

digital innovations traverses finance, healthcare, and e-
commerce

Before joining the US software company Salesforce as its India CEO,

Arundhati Bhattacharya was a chairperson at the State Bank of India,
where she spearheaded radical digital initiatives, including launching
digital-only brands and mobile apps. Bhattacharya’s pursuits are
backed by her belief that for a country of India’s size, population, and

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geography, financial inclusion can only be attained by having a strong

technology backing. “If we are talking about raising the standards of
living of all Indians, digital is the only way up. It is too costly to deliver
all the services to all corners of India through a brick-and-mortar
approach. If you do it digitally, you can not only deliver it to the far
reaches of the country, you can also hyperpersonalize it by using AI
and robotics,” she said.

For Nandan Nilekani, cofounder and nonexecutive chairman of the

multinational IT company Infosys, markets play a role in the
widespread adoption of digital technology, but some things must be
provided as public infrastructure, as a means of creating social good.
As he told McKinsey, “If a billion people can use something, then
that’s a benefit. A billion people can learn, get better healthcare, and
change jobs using technology.” Nilekani, who has helped the Indian
government roll out several digital initiatives, including the digital
identity card Aadhaar (the world’s largest biometric program), is now
focused on creating an open technology network for India’s e-
commerce market to help smaller merchants and retailers compete
with larger technology companies.

Alongside digitization, Asian business leaders are also making

proactive moves to capture the opportunities arising from the net-
zero transition. Asia’s sustainability efforts have created a market for
green businesses that could reach as much as $4 trillion to $5 trillion
in size (across 11 sectors) by 2030, according to McKinsey analyses .
Keppel’s Loh, for example, kick-started a bold organizational
makeover in 2020, putting environmental sustainability at the core of
Keppel’s strategy, mission statement, and its senior management’s
performance appraisal process. The firm is also incorporating
sustainability into its investment strategy, be it through developing
floating or tropical data centers, or using liquid hydrogen or green
ammonia to power the energy grid and data centers. “I think the
market likes the idea that we are not just green but can promote a

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greener world through the solutions that we provide to our

customers,” he said.

Meanwhile, Australia’s decarbonization efforts and rapid acceleration

of its digital economy have also created extraordinary opportunities
for businesses. Australian Banking Association’s Bligh highlighted
the country’s numerous solar and wind power locations, its vast
hydrogen opportunity, and its global competitiveness in suppling
critical minerals into the digital economy. “These are just three
opportunities, but what needs to go with that is making sure that we
have the skills, the investment, the resources, and the mindset to
build on top of that and make Australia one of the leading countries
in this transition,” she said.

Creating dynamic, inclusive, and

resilient cultures

Asian leaders are also prioritizing—and in many ways rethinking—

their relationships in the workplace. At a time of fierce competition
for talent and finding the right hybrid-working norms, leaders are
placing renewed emphasis on strengthening their organization’s
culture and purpose.

Video

Wipro’s Rishad Premji on leading culture change through

self-motivation and myth-busting

For Girish Mathrubootham, CEO and founder of software-as-a-

service (SaaS) firm Freshworks, human-centered leadership has
been a crucial driver of success. Mathrubootham believes that
building a successful business with the right value system and ethics
is an accomplishment by itself. “The only thing that works in

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Freshworks for a leader is earning trust through a heart-led

approach, which focuses on putting humans first, over business
motives, and doing the right thing by them,” he said.

In 2020, Rishad Premji, chairman of the software giant Wipro, also

began the task of reshaping the organization’s culture by
institutionalizing five commonplace habits in the workplace: being
respectful, being responsive, always communicating, demonstrating
stewardship, and building trust. According to Premji, people and
culture determine a company’s success and failure as much as
strategy, if not more. “The question is how can you build this strong
high-performance organization? Oftentimes, people associate that
with being a bit rough and abrasive. I am a big believer that you can
build a high-performing organization that still has a soul, that is
empathetic, vulnerable, collaborative, and decent,” he said.

Some executives are also working to improve the relationship

between the CEO and their boards, an often-discussed topic that has
become even more relevant as companies deal with increased
uncertainty. Alison Watkins, who sits on the board of several
organizations, including the biotech company CSL, the Reserve Bank
of Australia, and the retail conglomerate Wesfarmers, believes there
is a healthier balance between the board and CEO today, with a
broad-based focus on a number of metrics beyond financial
numbers. “The days of the omnipotent CEO, with the board being
much less proactive, are over. I think that is a big and really healthy
change,” she said. “The boards of today work with CEOs, who don’t
come across as big, powerful, egocentric individuals but just as
people who are part of a team and want to work together with the
board to achieve an outcome that everyone agrees on.”

Adopting a growth and learning

leadership mindset
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Video

Dr. Reddy’s Laboratories’s G.V. Prasad on navigating

experimentation and failure in pharmaceuticals

In instituting large-scale transformations for improved organizational

performance, Asian leaders are also extending their leadership tool
kits to keep up with the currents. According to Watkins, CEOs are
increasingly adopting an enterprise risk management approach to
test out how to think about all the externalities that may potentially
impact the business. “Enterprise risk management has gone from
being something that seemed vaguely theoretical, a bit bureaucratic,
and unrelated to the real world to now becoming the source of some
important strategic conversations,” she said.

These leaders have not only focused on speed, nimbleness, and

responsiveness but also have encouraged risk taking and innovation.
G. V. Prasad, cochairman and managing director of Dr. Reddy’s
Laboratories, said that failure is an inherent component of an
industry like pharmaceuticals. “We are a very experimentative
company. We encourage people to take risks. In that process, if they
fail, but they fail for the right reasons, we are OK with that. We don’t
punish failure,” he said.

Video

Anna Bligh on what to do when crisis strikes

In a world of heightened volatility and uncertainty, today’s top leaders

are demonstrating courage and conviction while making strategic
calls for their businesses. “One of the definitions of a crisis is that you
have to make high-stakes decisions in really suboptimal
environments,” said Bligh. “You will not get all of the information. You
won’t have the time to peer review over a number of weeks the full
range of options. You may only have an hour to make a decision that
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is going to impact potentially real life-and-death situations. It

requires a lot of courage to make that call. But I think hand in hand
with that courage to make the call also is a willingness to accept
responsibility for the call.”

Resiliency expert Dr. Amit Sood has said: “Uncertainty and lack of
control are not new. The stressors just keep changing. The headline
is our increasing adaptation. We are a species that is very flexible at
recalibrating our expectations.” As we reflect back on 2022, we’ve
seen a new form of leadership take hold in Asia with the ability to
withstand, bounce back, and grow businesses despite the
downturns. Leaders in Asia are making big, bold bets to drive long-
term value. These transformative initiatives—whether in corporate
strategy, organization capabilities, people and structures, technology,
sustainability, or the broader community—will help power the next
phase of growth and define how a new era of business emerges.

1. “IMF launches regional economic outlook report for Asia and Pacific: Sailing into
headwinds,” International Monetary Fund, October 27, 2022.
2. “In just nine months in 2022, India witnessed some form of natural disaster almost
every day, says CSE’s new report on extreme weather,” Centre for Science and
Environment, November 1, 2022.
3. Shaping our digital future: Asia–Pacific digital transformation report 2022, UN
Economic and Social Commission for Asia and the Pacific, August 30, 2022.

ABOUT THE AUTHOR(S)

Gautam Kumra
Senior Partner and Chairman - Asia, Singapore

 LinkedIn  Email

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1/20/23, 10:13 PM Asia’s top CEOs embrace change with boldness and resilience | McKinsey

Joydeep Sengupta
Senior Partner, Singapore

 LinkedIn  Email

This article was edited by Arshiya Khullar, an editor in the Gurugram

office.

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