Graduation address given by Mark Burrows

Mark Burrows gave the following occasional address at the University of Sydney Business School graduation ceremony held at 9.30am on 5 October 2012 in the Great Hall. Mr Burrows is Executive Vice Chairman and Managing Director for Credit Suisse, Asia Pacific.

The photo below is copyright, Memento Photography.

Mark Burrows

Graduation address

Chancellor, Academic Staff, Graduates, Parents and Friends, good morning.

Firstly, congratulations to all of you who today received your degrees from Marie Bashir, the esteemed Chancellor and might I say national treasure. CAN there be a more beautiful hall in which to acknowledge your diligence and academic achievement, nor a more beautiful quadrangle and stunning Sydney spring day to be joined in celebration with your family and friends in your mortars and academic gowns?

In the recent rankings by The London Times, Sydney University was ranked 62nd so you are graduating from one of the top universities in the world. One whose Vice Chancellor and Senate is striving to improve and importantly committed to exploiting the geographical advantage that Sydney University has over European and North American counterparts in being part of the higher education revolution in Asia Pacific. I am lucky to be a graduate of Sydney University and it was with the benefit of the degrees from this august institution that I was able to secure my first job as a lowly Analyst at the iconic English investment bank of Baring Brothers 40 odd years ago in London. So whatever I have made of my professional career since then, the starting point was the credibility that I gained from graduating from this institution.

Some years ago my daughters, also graduates of this university, and I planted a tree in the Botanic Gardens in Sydney in memory of my late wife where I wrote the words “Under the magic tree you can see forever”. The meaning of the words were intentionally ambiguous, the future being very much in the eye of the beholder; of course no one can see forever. Today I want to briefly touch on matters that relate to the future.

Firstly, what are the opportunities that present themselves to you graduating from this institution? No need for me to tell you that the opportunities that you will have from working in the Asia Pacific region are far greater than in any other sphere on this planet. The opportunities presented by 2.5 billion people in this region becoming wealthier and spending more is seen by some commentators as the $10 trillion prize. There is confusion about what the middle class is in the region and its rate of growth rather than the trajectory itself. Of the 1.2 billion Indians, 5% have cars but 21% have motorbikes, 2/3 have mobile phones and access to electricity; is the Indian middle class therefore 250 million or 60 million? Culturally India and China could hardly be less alike and there are obvious demographic differences. One is consumption, one is export. India is a decade behind China. It will be generations before per capita approaches the West and the Asia Pacific region is now filling with educated, aspirational people that have that sense of optimism and resolve that defined the America and its wealth and creation but with enormous cultural and religious differences.

America of course is still a country where most aspire to do better than their parents through education, hard work and innovation. For me the key ingredient of aspiration is a sense of optimism balanced by believability. When we think of the future you will all no doubt have studied John Maynard Keynes on macro economies and the Keynes economic theory which has today been sin binned by the austerity madness of the Europeans in Brussels. But interestingly Keynes made a real contribution to the theory of probability and risk. This was the subject of his fellowship at Kings College Cambridge. Keynes believed that the financial and business environment was characterised by “radical uncertainty”. The only reasonable response to the question what will interest rates be in 20 years’ time is simply, “we do not know”. Keynes saw the future more clearly than most but when it came to specific events and how they would unfold he simply did not know, like everyone else. For him, probability was about believability not frequency nor a probability distribution curves of future events.

So what is believable about the future of the world you are entering? Unquestionably you are going to work in that part of the world with the greatest growth upside where aspiration is driven by optimism of a better future. You leave with qualifications from one of the great universities and enter the epicenter of economic growth for the next century. But like Keynes, we cannot be certain as to the future, we do not know what might happen. Seismic changes are taking place as a consequence of the third economic revolution (the period from the invention of the chip in computers and encompassing the present digital world) and some commentators are questioning sustainability of long term growth cycles. For a Europe with declining population, fiscal imbalances and an entitlement mentality stagnation may well proceed long term decline, but that is the old world.

Rather perversely, the person that to me best personifies the challenges of the future and who would have enjoyed talking to Keynes is someone who dropped out of university. In doing so he stayed on at university for a further eighteen months so he could do whatever courses he liked without compulsion or restraint. The university that he attended at that time offered perhaps the best calligraphy instruction in the United States. He decided to take a calligraphy class to learn how to serif what made typography great, how calligraphy was itself beautiful, historically and artistically subtle in a way that science couldn’t capture. None of this had any practical application in the university drop-out’s life, but ten years later when Steve Jobs was designing the first Macintosh computer, he designed it all into the Macintosh, beautiful typography. Without attending that class the typefaces you use, the beautifully spaced and proportioned fonts all copied by Microsoft Windows would never have happened. Steve Jobs’ famous address to Stanford University in 2005, he said that “his wish for all was to stay hungry, stay foolish and trust in destiny”. To me staying hungry is all about attitude and aspiration, staying foolish is about risk, invention and originality, trusting in destiny needs no explanation. But none of us can foretell the future and while we all aspire to great things and ultimate success at our chosen careers, it is what you do tomorrow that may well dictate your future. Steve Jobs did calligraphy.

But Europe apart, Asia Pacific will not have the next century to itself. As I said, my view of the economic future of Europe as a whole is a deeply pessimistic one but I also believe that you will see a resurgence of America driven by their optimism, enterprise, ingenuity, a people of constant reinvention. Added to that will be the dramatic increase in American oil and gas production. The thought of the United States being a net exporter for fossil fuels is breathtaking in its consequences. But then again, America is the country that fathered Steve Jobs and Apple; trust in destiny.

Some personal insights from my own experience in Asia Pacific are the integrity and professionalism of the bureaucrats in the region. The impasse on the Dohar Round is being resolved by bilateral agreements largely between Asian Pacific countries. In Asia corruption is on the decline. The opportunity for businesses in Australia of connectivity in Asia is how to capture about $275b additional revenue from Australian and Asian Pacific trade not in resources but in intellectual property, education, health, agriculture and green technology. Economic integration between Australia and China is set to intensify in the years ahead with Chinese investing in more resources and agricultural businesses here and Australian companies ramping up their investment in China. We have on our doorstep two of those “BRICS” India and China, but equally significant next door we have Indonesia, a vast country with a growth rate of over 6%.

What a great century and sphere of the globe to be venturing into. Under the magic tree, which for you is your degree from Sydney University, you can indeed see forever.