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European Edition
1st March 2024
 
THE HOT STORY
Teleperformance shares slump amid fears over impact of AI
Teleperformance shares plummeted in Paris trading following a statement from buy-now-pay-later lender Klarna which rekindled concern that artificial intelligence will hurt the French company's call-centre business. The Swedish fintech said its AI assistant, powered by OpenAI, is doing the equivalent work of 700 full-time agents and has had 2.3 million conversations, equivalent to two-thirds of the company's customer service chats, within the first month of it being deployed. The AI tool resolved errands much more quickly and matched human levels on customer satisfaction, Klarna said. “The group's current activity in no way reflects the negative conclusions in its business that could be drawn from the technological developments mentioned in this communication,” Teleperformance said in a statement. Teleperformance already uses AI, it said. “The AI debate has raged on for Teleperformance in 2024,” Morgan Stanley analyst Annelies Vermeulen observed, adding  “Until questions around impact of pricing deflation, automated volume and shape of future earnings are answered, the stock performance may remain challenged.”
REMUNERATION
Pay raises for City of Helsinki employees
More than 4,500 employees of the City of Helsinki are set to receive pay raises as part of the city's salary development programme. The raises will go to early childhood education teachers, youth counsellors, and other professionals. The city's HR chief, Petri Lumijärvi, stated that the increases make salaries more competitive and improve the quality of services provided to residents. The salary development programme's allocation of raises changes each year across the city's various departments.
HIRING
Autistic people are being held back by job interview questions, UK report says
Ambiguous interview questions and application forms are keeping autistic people in the UK out of work, according to Sir Robert Buckland's report on autism in the workplace. Dr James Cusack, chief executive of research charity, Autistica, said: "To be their best and to ensure they can get the best out of their whole workforce, including autistic people, employers need to change the way that they recruit and support staff. This is not about reasonable adjustments for a small number of people - it's about changes that benefit everyone, because we all think and work differently." The review was commissioned by Work and Pensions Secretary Mel Stride, who said it provided "practical and inexpensive steps to open up workplaces to autistic people," backed by the extra employment support available in the government's £2.5bn Back to Work Plan. Businesses and government "must come together if we are to create the cultural change needed," he said. The Buckland review sets out how businesses and government can work together over the next five years, and it lists 19 recommendations for both. The UK's Equality Act 2010 made it harder for employers to unfairly screen out disabled people and ensured there was a duty to make reasonable adjustments for people at a substantial disadvantage because of their disability.
STRATEGY
UK's AstraZeneca chooses Shanghai as fifth global strategic centre
AstraZeneca has announced that Shanghai will be its fifth global strategic centre, reflecting the UK-headquartered pharmaceutical company's confidence in China's market strength. The new centre in Shanghai will integrate research and development, commercial, and production operations, and serve as a key strategic hub for AstraZeneca's global strategy and long-term development. Pascal Soriot, CEO of AstraZeneca, stated that the purpose of the expansion is to deepen their understanding of China and increase investment in innovation, benefiting patients worldwide. Shanghai, known for its thriving biomedicine industry, has implemented policies to support enterprises and promote R&D facilitation. AstraZeneca's Asia-Pacific headquarters, China headquarters, and global R&D China centre are already located in Shanghai. .
Thyssenkrupp plans to cut 5,000 jobs in steel division restructuring
Thyssenkrupp is considering cutting at least 5,000 jobs as part of the restructuring of its steel division, reducing the unit's future structure to 27,000 employees. The management board is working on a concept to be presented in mid-April. Thyssenkrupp declined to comment on the report in the German daily Handelsblatt.
CORPORATE
Consolidation in HR services as Deel acquires AI startup Zavvy
Consolidation is underway in the HR services industry as Deel, a Paris-based HR business, acquires Munich-based AI startup Zavvy. Deel, known for its payroll and HR services for distributed workforces, plans to incorporate Zavvy's personalised career progression and performance management tools into its platform. The acquisition price was higher than Zavvy's previous valuation of $16m. Deel, with 25,000 organisations as customers, including Reddit and Nike, is now seeing annual recurring revenues of over $400m. The company has been profitable since September 2022 and has over $600m in funding. Deel's IPO is expected in 2025/2026. The acquisition reflects the trend of larger players acquiring smaller startups to provide comprehensive HR solutions.
TECHNOLOGY
Microsoft, OpenAI and Nvidia back $2.6bn robot start-up
Investors including Microsoft, OpenAI and Nvidia have backed Silicon Valley start-up Figure AI to the tune of $675m as it pushes to introduce artificial intelligence-powered humanoid robots to the workforce. “Our vision at Figure is to bring humanoid robots into commercial operations as soon as possible,” CEO Brett Adcock said. “This investment, combined with our partnership with OpenAI and Microsoft, ensures that we are well-prepared to bring embodied AI into the world to make a transformative impact on humanity.”
AI to transform accountancy, says Sage CEO
Steve Hare, the CEO of UK-headquartered software company Sage, predicts that artificial intelligence (AI) will revolutionise the accountancy industry, leading to fewer but more productive jobs. Mr Hare believes that generative AI will soon be relied on by small businesses for basic accounting work, such as tax returns, which will eliminate the need for paper receipts and manual data entry. While AI will reduce the number of mundane accounting jobs, Mr Hare believes it will create more jobs focused on advisory, forecasting, and strategy. He also said that AI will not replace accountants but rather assist them in tasks and problem-solving. His comments came as Sage unveiled its new AI-powered software, Sage Copilot, which aims to automate administrative tasks, provide insights for business improvements, and enhance productivity.
RISK
Switzerland urged to strengthen banking supervision
Switzerland needs to strengthen banking supervision and its rules for handling failing lenders without burdening taxpayers, according to the G20's risk watchdog. The review highlighted the reliance on external auditors by Swiss regulator FINMA, which it says may lead to hesitation in reporting major weaknesses. The Financial Stability Board recommends increasing supervisory resources, strengthening early intervention powers, and enhancing the recovery and resolution regime. The watchdog also calls for the adoption of legislation for a public liquidity backstop facility. The review emphasises the importance of these measures after the merger of UBS and Credit Suisse, as the failure of the combined bank could have severe impacts on the Swiss economy and the global financial system.
TAX
France calls for global minimum tax on super-rich
France's Finance Minister Bruno Le Maire has called for a new push for a global minimum tax on the super-rich, following the success of a 15% minimum on multinationals. The aim is to prevent tax optimisation by the wealthiest individuals, who can currently avoid paying the same level of tax as others. A study by the EU Tax Observatory suggests that a global minimum tax on billionaires could generate $250bn annually. France wants Europe to take the lead on this issue, in line with the global minimum corporate tax. Over 140 countries have already backed a 2021 agreement to apply a minimum corporate income tax of 15%. Brazil, as the current G20 president, also plans to initiate discussions on international measures to discourage the super-rich from using tax havens.
INTERNATIONAL
European countries weigh reopening embassies in North Korea
A German delegation from the Federal Foreign Office has visited Pyongyang, North Korea for a technical inspection trip, marking the first visit since the closure of the German embassy due to the pandemic. The delegation inspected the embassy site, but no decision has been made regarding its reopening. Other European countries, including Britain and Sweden, also plan to send teams to North Korea. The countries are encouraged by North Korea's recent moves to ease international restrictions and reopen its borders. However, the return of diplomats is expected to involve security measures, repairs, and clearance of the facilities. As of January 2023, only nine countries have functioning embassies in Pyongyang. China, Russia, Mongolia, and Cuba are the only countries allowed to rotate staff at their embassies.
White House to issue executive order restricting access to Americans' personal data
The White House will issue an executive order to prevent countries like China and Russia from accessing sensitive personal data about Americans and individuals connected to the US government. The order sets forth new restrictions on transactions of various types of personal data, including genomic data, biometric data, personal health data, and financial data. The US is concerned about foreign adversaries leveraging their access to this data for malicious activities. The order will target countries such as China, Russia, North Korea, Iran, Cuba, and Venezuela. It will focus on tackling the legal means by which these countries gain access to personal data, including through data brokers and commercial channels. The restrictions are expected to have an impact on US engagement with Chinese companies, including TikTok. The order may have implications for commercial activity and scientific research, but exemptions will be considered to limit unintended adverse impacts. The executive order will be implemented after multiple rounds of public consultation.
China broadens law on state secrets to include ‘work secrets'
China's top legislature has started a second reading of changes to the state secrets law, proposing greater restrictions on matters considered state secrets. The draft includes tighter rules over "work secrets of government departments," giving authorities greater flexibility over what cannot be disclosed. The amendments also require state employees with access to classified information to undergo secrecy education and return classified materials. The revised law will also compensate individuals when their rights and interests are restricted for reasons of state secrets. The first draft of the revised law was put to the Standing Committee in October, followed by a month-long public consultation. Revisions to Chinese laws typically go through two or three rounds of deliberation. 
Nepal faces severe shortage of healthcare workers
Nepal is facing a severe shortage of healthcare workers: the country is included in a World Health Organization "red list" of nations with this problem. Limited financial resources for healthcare in Nepal have led to many nurses seeking better-paid jobs abroad. The situation has been exacerbated by a bilateral government pilot programme with Britain, which plans to recruit 10,000 Nepali nurses. This could worsen the shortages in Nepal, where less than half of the required 45,000 nurses are currently working. The causes of the staffing shortfall in Nepal go beyond migration, with the government allocating only around 4% of the total budget to the health sector. This has led to nurses experiencing demanding working conditions and low pay, prompting many to seek opportunities overseas.
South Africa to speed up work permit processing for large companies
South Africa plans to reduce work permit processing times for employees of large companies from 22 weeks to 20 days. The Trusted Employer program aims to expedite processing times for technicians and executives brought in to work for companies. The Department of Home Affairs introduced the program as part of its visa reform programme.
 


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