Interview with Mohammed Al-Mady, SABIC

Mohammed Al-Mady is CEO of SABIC, a Strategic Partner of the World Economic Forum

What does the Annual Meeting Theme, “The Power of Collaborative Innovation” mean in your business?

From our earliest days of formation, SABIC has learned to work collaboratively with other companies to share knowledge and financial resources through joint venture projects.  As a company we have greatly benefited from our joint ventures.  We plan to continue expanding our business through joint ventures as well as acquisitions.

How will you use the Annual Meeting to collaborate with other stakeholders to address your top issue on the Global Agenda?

As a petrochemical producer, I am interested in what steps industry leaders are taking or contemplating to address global warming and CO2 reductions.  Clearly, this is an issue that will have significant impact on the hydrocarbon processing industries.
 
In which new ways are people and organizations collaborating and how important is this for effective competition in your industry?

Competition in our industry benefits from growth in international trade as the global marketplace represents the world’s most competitive market.  However, companies and our industry must be strong and healthy and have the confidence of the general population in order to remain viable.  Our industry must respond positively to address issues such as global warming and the safe use of our products.

Regional trade associations in our industry such as the ACC, GPCA and CEFIC as well as others are searching for ways to work cooperatively to insure that our industry addresses global issues in an effective and beneficial manner.  I believe that collaborative efforts of the regional trade associations represents at a very fruitful avenue in addressing global industry issues.

Concerns about a lack of talent and a widening skills gap continue across many industries and regions; how are you responding to these challenges with your organization?

Our objective is to make SABIC a “learning organization.”  We have many talented people in our organization around the world.  We will work to continually upgrade the skill level of our employees through tapping into the knowledge base within our company as well as outside knowledge and innovation resources.  This is a serious strategic priority for SABIC worldwide.  SABIC will be relentless in its effort to provide the environment that will support its employees reaching their full potential.

What projects and initiatives are you engaged in with the World Economic Forum and what drove you choice to partner with the forum on these projects?  In what ways can businesses contribute to tracking challenges on the global agenda?

Business can play a very important role in addressing global poverty through ever increasing support for world trade and reduction and elimination of various trade barriers.  Business also has a very important, and I might say, a key role to play in addressing the issue of global warming.  Much of the economic burden will fall on industry.

How do you see the world economy evolving in the next 12 – 18 months and how confident are you that current market volatility will begin to stabilize soon?

I believe that we will still have positive global growth in the next 12 – 18 months but at a somewhat lower level than 2007.  The slowdown of economic growth in the U.S. and probably Europe will provide a modest drag on global economic growth.  Fortunately, emerging markets are expected to have good economic growth in 2008.

Market volatility is due not only to strong demand for most commodities, the weak dollar and high energy prices but also due to heightened geopolitical risks and uneasiness.

We should plan for continued market volatility until some of the serious geopolitical risks and turbulence in financial markets are resolved.  Obviously, this will take significant efforts as well as time.

Beyond the rapid growth seen in India and China, which other markets are you watching closely and why?
 
Because of our strategic vision of becoming a leading global producer of petrochemicals, SABIC is watching and evaluating all markets including those in which our company is under represented such as Latin America, Russia and Eastern Europe.  Of course, we are continually striving to grow our market share in the major consuming markets of Asia, Europe and North America.

Do you think we are seeing a significant shift in the way the public and private sector can collaborate and what are the implications for business?

The private sector can play an effective role in developing fruitful commercial relationships across borders.  These commercial relationships have, in many instances, yielded positive results and support government to government relations when accompanied by successful diplomatic initiatives.  The role of government sanctions in achieving political goals has been largely unsuccessful!

If you are a leader in an industry where science has always played a role, what advice can you share with others who may now be more concerned by scientific considerations than in the past?

As science in industry is examined more closely by political bodies and NGOs, it is quite important that policy decisions are based upon sound and valid science.  Unfortunately, in too many instances, judgments are based upon political considerations and good science falls victim.

In what way should science play a greater role in driving policy making given its growing importance with respect to almost every policy issue on the global agenda? (E.g. Climate change, health, ageing, genetics and biofuels.

Sound and valid science should play a major role in guiding major policy development and progress in resolving the global issues we all face.  Many public sector bodies lack qualified scientific inputs and too many policy decisions are based upon non-scientific inputs such as political interests.  This delays reaching science-based policy decisions.

In what ways is your company using new communication channels – blogging, social networking websites, etc. – to reach an external or internal audience?  Have they focused in rethinking of your communication strategy?

I would say that we are using the more conventional channels of communication.  However, regarding internal communications, SABIC now has grown very quickly from 10,000 employees to 30,000 employees spread around the world.  This does suggest that we do need to examine our communication strategy – both to inform as well as to mold a SABIC culture and identity that unifies and links all our employees in a common culture and strategic path forward.

Given the demographic changes that we know are under way, such as increasing percentage of older populations in some regions versus a “youth bulge” in others, how is your corporation adapting to these shifts?

Since most of our products at the time are commodity products, our company is still somewhat removed from consumer products sector and we tend to watch broader trends such as economic growth.  To the extent that demographic shifts impact economic growth rates, that is a matter of interest to us.

What key things do you think countries, companies or individuals should do to make the world a better place in 2008?

Our company, SABIC, is a strong believer in promoting growth in global trade.  For many years our world has seen a steady and accelerating growth in international trade as more countries reduce trade barriers and adopt market oriented economies.

In the past years, millions of people around the world have been lifted out of poverty, have found jobs, have built homes and found a better life for their families.  International trade builds company to company and government to government good will and cooperative spirits.

In summary, I feel that providing strong support to continued growth in global trade and fair trade will have a most positive impact in building better lives for people now living in poverty.