Uncertainty keeping firms from making big moves: Sorrell

It is the uncertain economic environment that's keeping companies from big investments.

Also read: Davos bosses hunt $5 trillion new revenue in low-growth world  Martin Sorrell, Group Chief Executive, WPP says, "Companies are confident but they lack certainty. That may sound a little bit of a non-sense thing to say, but I think it’s really meaningful. In 2008 they didn’t have good balance sheets. They weren’t in a solid position, Lehman, the sub-prime, now they are sitting on USD 2 trillion of cash. They are in a much stronger position but they lack the certainty the grey swans as we call it". Below is the verbatim transcript of an interview aired on CNBC-TV18. Q: If cost deficiency is going to drive growth this year then when will CEOs start putting those billions and trillions of dollars that they have on their balance sheets back to work? A: I think it is a bit mucky. It is a slog. I have just finished looking in our numbers for last year and we have got to where we wanted to get to but we got their ugly. If you look at the West certainly, look at US and western Europe, it is tough and it continues to be tough. So we have had this long slow climb, a rebound after 2009 and 2010, we had a record year in 2011. I should not predict anything but it is reasonable to expect another record year in 2012. But having said that as I said we got there ugly and we got their by kicking and coring our way. It has been a bit of trench warfare, hand-to-hand combat. So, it has been difficult. In the faster growth markets of which India is one, it has obviously been easier but it has been less easy than it was before. So, we have seen the growth come off the boil at the top end of the Chinese, Indian, Brazilian and Russian growth rates and in the Next Eleven the same thing has been true. So, it has been tougher sledding in 2012 probably than we thought it was going to be. We had the Olympics, we had the presidential elections and we had the Union of European Football Associations (UEFA) Championship. The industry and I thought it would be a little bit easier, that does not mean it was terrible, it was not. But we did start off the year for the first quarter on like-for-like growth of 4 percent in our own business, then 3 percent in Q2 and 2 percent in Q3. I cannot say what happened in Q4 but probably a little bit better than we expected at the end of the day. So, all in all no complaints but it has been tough. Coming back to your survey, companies are confident but they lack certainty and that may sound a little bit of a nonsense thing to say, but I think it is really meaningful, because in 2008 they did not have good balance sheets. They were not in solid positions; Lehman Brothers, the subprime, the insurance monoline was a surprise. Now they are sitting on USD 2 trillion of cash and they are in a much stronger position, but they lack the certainty. Q: So this is not the year they are going to put that USD 2 trillion back to work or any substantial part of it, because that is what will get the wheels of the global economy going? A: I doubt it. We are making bets in the Brazil, Russia, India and China (BRICs), in Next Eleven, in digital media, in application of technology into our business, big data and last by getting our people to work more closely together. That is where we know there is growth and there is opportunity. Are we making those investments so much in the United States? Are we making it so much in UK, France, Germany, Italy and Spain, certainly in the digital areas we are but generally, no? If somebody showed me something interesting in Mumbai, Delhi or whatever I would take it. Before we were in preparation for my interrogation I was looking at our budgets for next year and we will cross USD 0.5 billion of revenue in India.