2020 CEO Survey: Bob Johnston, GPT

More than ever you need to plan for the unexpected, says GPT’s Bob Johnston

Bob Johnston, CEO of property major GPT Group. Picture by James Croucher

What are the three enduring lessons or changes to flow from COVID?

One of the most enduring lessons for me from the COVID pandemic is that you have to be resilient and focussed on things that you can influence. None of us had been through a pandemic before and there were many known unknowns. In these situations, you have to focus on what you can control and remain agile as things change. You need to expect the unexpected.

A health crisis is very different from a financial crisis. First and foremost, the focus has very much been to keep our people and communities safe. Clearly, managing the business risk is also important but health and safety has been the first priority, and this is something we will only build on going forward.

A key change coming from the COVID pandemic is the way we work. Technology has been leveraged exponentially and there is no doubt this trend will continue in the future. While face-to-face communication will continue to remain an important channel for learning and development and establishing relationships, we have shown that remote working can be done effectively and should lead to productivity benefits when combined with meaningful face-to-face interaction.

How would you rate the shape of the Australian economy as we head into the New Year?

I am optimistic about the outlook for 2021. Australia has come through the COVID pandemic well, with all levels of government working together to ensure there is a sensible balance between managing the health crisis and minimising the economic fallout. The rollout of a vaccine is now likely to occur well ahead of initial expectations and this is providing a greater level of confidence for business investment and consumers. The key will be how the economy transitions as government stimulus is reduced through the first half of 2021. Overall, while the path to recovery remains uncertain, we are optimistic about the prospects for a strong recovery in the second half of 2021.

What three reforms are needed to sustainably grow the economy?

The key to Australia’s long-term growth is investment and reform to successfully transition to a low carbon economy. This must be a priority for government and businesses over the next decade. Significant investment not only has to occur in renewables, but also in new technologies for carbon capture along with policy certainty to support private investment.

Reforms that drive innovation and investment will also be important for Australia to remain competitive as a nation. We have relied on population growth for many years to drive GDP growth and while population growth will return, we need to look at reforms that will help drive productivity per person gains.

What are the three best growth opportunities for your company in 2021?

E-commerce spend was accelerated in 2020 and while there was little choice for extended periods given the social distancing measures implemented by government, we think that the acceleration of this trend will lead to strong demand in Logistics facilities and GPT is well placed to benefit from this.

E-Commerce has also accelerated the transition of bricks and mortar retail which is a positive over the medium term. We expect that we will see a strong recovery in bricks and mortar retail in 2021.

Given Australia has come through the pandemic better than most other countries, we also expect strong capital flows into Australia that will benefit our Funds Management Platform.

What impact will digital transformation have on your company?

Digitisation of our business has been a focus over the last five years, providing real time customer insights and data flow that informs our investment decisions. There is no doubt in my mind that digitisation is at a tipping point and change in every sector is being accelerated. Investment in technology to enable real time decision making will become increasingly important.

How would you rate business, State and Federal Government performance this year?

I think the proof is in the pudding. Australia has come through the pandemic well ahead of most other countries, and this has been achieved by an unprecedented level of co-operation across Federal and State governments. It hasn’t been all plain sailing but in the main they have done a good job. Business and community co-operation have also been instrumental in achieving this outcome.