Business Round-Up: Academic warns of the dangers of inequality - The Post

Business Round-Up: Academic warns of the dangers of inequality

In other news, Vestas informs its shareholders of a change of leadership, while Pandora is preparing pink slips for 1,900 of its employees

A getting ‘tired of getting the fuzzy end of the lollipop’ kind of scenario (photo: LuciaSofo)
May 8th, 2019 3:32 pm| by Ben Hamilton

Since 1912, the Gini index has been used to measure economic inequality, and in Denmark right now, it has never been higher, claims the Fagbladet 3F trade union based on its analysis of Danmarks Statistik data.

While the income of the poorest 10 percent in Denmark has remained unchanged over the last decade – a net income of less than 10,600 kroner a month – the wealth of the high-earners have shot up.

Detrimental to health
The upshot is that the index rose from 22.07 in 1987 to 29.32 in 2017.

“I think that if you asked Danes whether they would want such a large increase in inequality, most would say no,” Professor Kasper Lippert-Rasmussen at Aarhus University told TV2.

Wealth inequality can be detrimental to our health and perceived social status, he warned.

Vestas chief executive to step down
Anders Runevad, the Swedish chief executive of Vestas since 2013, is stepping down. His replacement, Henrik Andersen – the current CEO of Hempel, who is a member of the Vestas board – will take over on August 1. Runevad, 59, is credited with steadying a ship that was in rocky waters when he took over, as the period between 2011 and 2013 was generally regarded as a period of crisis. Runevad will continue in an advisory role until the summer of 2020. Runevad’s predecessor, Ditlev Engel, was also a former CEO of Hempel.

Danfoss revenues still increasing despite slowdown in China
Danfoss revenues shot up to 1.56 billion euros (just under 10 billion kroner) for the first quarter of 2019, despite a slowdown in China. Strong sales in North America and western Europe were fuelled by the group’s increasingly green focus and the strong performance of two of its units: Danfoss Power Solutions, which provides large vehicles for agriculture and construction, and Danfoss Cooling, which provides air conditioning and refrigeration units.

Pandora to chop 50 stores and close to 2,000 employees
Danish jewellery group Pandora has confirmed plans to shut down 50 stores – 4 percent of its total number – following its announcement that its Q1 revenue has fallen by 12 percent. Sales at its physical stores decreased by 10 percent, while online trade rose 7 percent. Some 700 production employees have lost their jobs in Thailand, and a further 1,200 worldwide. Overall, Pandora’s expectations for 2019 remain the same: a decrease in revenue of 3-7 percent.

Arla on track with environmental commitments
Arla has confirmed that its environmental efforts this year will cut down its CO2 emissions by 7,330 tonnes. The measures include using bio-based plastic (extracted from sugar cane or wood waste) to produce 600 million milk cartons (previously they were fossil fuel-based plastic) and making 560 million yogurt pots recyclable. Overall, Arla intends to cut its CO2 emissions by 30 percent by 2030 at a rate of approximately 8,000 tonnes a year, and then to be CO2-neutral by 2050.

House prices hit decade-high levels
Nationwide house prices have equalled a decade high set last August of 14,057 kroner per square metre, according to Boligsiden.  On average, nationwide house prices (villas and terraced houses) have increased by 2.1 percent since April 2018: by as much as 2.9 percent in the capital region and 2.8 percent in northern Jutland. At the other end of the scale, prices have fallen by 1.0 percent in southern Denmark. Boligsiden communications director Birgit Daetz expects house prices – which are currently increasing faster than apartment prices, which have only risen by 1.2 percent since April 2018 – to continue rising for the forseeable future.

Organic food sales in the ascendancy
Organic food sales rose by 14 percent in Denmark in 2018 to total 12.9 billion kroner, according to Danmarks Statistik. Nowhere in the world do organic foodstuffs account for a bigger share of the overall total. Organic fruit and vegetable sales rose to 4.3 billion (accounting for 38 percent of the increase) – up from 1.3 billion in 2012. Landbrug & Fødevarer, the agriculture and food council, is predicting a further rise of 10-15 percent over 2019, and similar year-on-year increases for the foreseeable future.