Author: Mel Chamber

EY Malta’s Industry Focus Sessions held in collaboration with The Malta Chamber have returned. The event was the first in this year’s series which leverages the insights of The EY Future Consumer Index in different sectors, The Malta Chamber’s experienced network, and the perspective of business leaders in the market.

This session focused on the retail sector. The aim was to continue exploring new avenues of opportunities to redefine the industry in an ever-evolving local and global market post-COVID. The move to digital meant larger markets and greater space for experimenting with the customer’s journey. As consumer preferences and behaviours continue to change further growth is being envisaged.

Dr Marthese Portelli, CEO of The Malta Chamber kicked off the event. She said that, “retailers need to fully reimagine their business models. Very few have taken or are taking the full plunge. Some retailers are choosing to retain the status quo, while others are responding with incremental changes. This passivity has resulted in reduced spending and insufficient investment in crucial areas.” Dr Portelli also emphasised three main areas which the retail industry must work on: Managing the skills shift; Adopting a more agile and omni-channel operating model and Embracing automation across their organisations.

Gilbert Guillaumier, EY Malta Strategy and Transactions Partner, and Gianluca Trapani, EY Malta Strategy and Transactions Senior followed up with a presentation of the local results of the 8th EY Future Consumer Survey against the backdrop of global insights. The survey highlighted that the key emerging trends which are affecting consumer behaviour and choices are affordability, accelerated digital adoption, focus on health, awareness of sustainability issues, and seeking experiences.

In fact, these five themes were among the foremost topics covered by the panel discussion including Norman Aquilina, The Malta Chamber Council Member and CEO of Farsons Group; Geoffrey Debono, The Malta Chamber Council Member and CEO of Debono Group Holdings Company Ltd; Alona Andruk, CEO and Founder of Take Off and BundleX; moderated by Theo Dix from EY Malta.

The panel discussion revolved around the importance of having customers as a focal point for a successful brand strategy. They spoke about the fact that companies need to be sensitive to what the market is telling them and it would be foolish to push premium brands to all the customers if they are not interested in them. The speakers emphasised that, we as retailers need to know what the customers’ needs and preferences are and to do so constant communication with your target audience is key. To obtain this the use of technology and digitilisation is fundamental.

In her closing remarks, Rachel Attard, Head of Communications and Strategy at The Malta Chamber said that, “This survey showed that consumers and retailers are vividly aware that this is a time of disruption. There is increasing pressure on profitability and return on capital. But at the same time there is a growth of opporunities, new opportunites, leading to a sustainable future.”

Key Findings and Observations

The study showed that growing concerns about affordability have led to a change in priorities from long-term, collective goals, towards shorter term, individual goals. This reprioritisation is driving behaviours such as cutting back on non-essential spending, exploring alternative brands to reduce costs, and becoming more sensitive towards wastage.

An extent of spending reprioritisation is seen between customer segments by income category, as lower/ middle income groups are indicating less expenditure on discretionary items, whilst high income earners are spending more on grocery deliveries, non-alcoholic beverages, and vacations in the coming months.

Customers are gradually starting to follow through on their intentions on the sustainability agenda by making incremental behavioural changes in this respect. Consumers are now demanding better information, easier access to sustainable products, and less confusion around sustainability claims of companies. Especially when considering that 61% of buyers now pay more attention to the environmental impact of their purchases with 51% also noting their societal impact.

Against this backdrop, the need for customer-centricity is not retreating, but accelerating as consumer expectations evolve, enabled by other factors such as increased transparency and choice, rapid technological shifts (especially in digital environments), mounting concerns and commitments around sustainability, and convergence between different sectors as retailers explore new ways to unlock value.

Way Forward

Inflation is showing no signs of slowing and consumers are concerned. Retailers must act in accordance with their customers’ changing priorities. Some retailers may find that passing on cost increases to customers can prove difficult and efficiencies in the cost structure need to be sought. Technology and digitisation of business processes can help in this respect. Customers also want more transparency around business’s sustainability goals and a better customer experience overall.

It may seem a tall order but those who are embracing adaptation are finding new areas of revenue which is helping them both survive and thrive. It is time to accept that the new normal is here to stay, and while the appeal of shopping pre-COVID is still around it will take more than that to convince patrons to buy.

“Education matters greatly for business. It matters for human capital; digitalisation; sustainability; good governance; and for the overarching goal of resilient economic growth. All this is key to maintaining Malta’s international competitiveness,” The Malta Chamber President, Chris Vassallo Cesareo, said in his opening speech during a conference organised in collaboration with HSBC Malta Foundation.

The Malta Chamber of Commerce, Enterprise and Industry organised a conference titled ‘Skills Rush: Have we missed the bus?’ which published the analysis and results of an exercise carried out by Prof. Alexiei Dingli and Prof. Rose Marie Azzopardi in relation to Human Capital and its transition from a local, European and Global context. This study was carried out through the Human Capital Research Project funded by the HSBC Malta Foundation.

The Malta Chamber President said that “we will remain committed to put the Education sector at the forefront of our work. Human Capital has always been one of Malta’s greatest resources and we are supporting this project because we believe in having an optimum workforce that can address future needs.”

Geoffrey Fichte, CEO at HSBC Bank Malta, noted that “given HSBC’s commitment to Malta, we want to raise awareness on an important topic that affects our customers and the community: Future Skills. At HSBC Malta, we are constantly investing in the long-term success of our people and our community. We need to ensure that our people have the skills needed for the jobs of the future. Therefore, we are supporting this 3-year project, which is being endorsed by the Ministry for Education, because it anticipates the skills needed to succeed and ensure Malta’s ongoing competitiveness in the global economy. Together with The Malta Chamber we hope that this project plays a key role in the formation of national policy in this area.”

Minister for Education, Sport, Youth, Research and Innovation Clifton Grima in his address said that “we need to equip our students with the necessary skills such as critical thinking and problem solving. The education system should be able to give our children the right tools that the future needs.”

AI Expert Prof. Alexiei Dingli together with Economist Prof. Rose Marie Azzopardi emphasised that in today’s fast-changing world, Malta is ready to make a big difference in education. “We need to create learning plans that are personalised for every student’s unique needs and talents, instead of a one size fits all. Tools like chatGPT can greatly help our learning process. It’s no longer about having access to knowledge but more about knowing how to use it in our tech-driven world. It’s also important to connect school learning with real-world jobs. We want our students not only to learn but to use this knowledge in everyday life. This means getting them comfortable with digital tools and technology from a young age. Malta’s current economic model is unsustainable.  We need to focus on quality not quantity, evaluate the high level of skills mismatch in the labour market, aim for a skills anticipation strategy, consider reskilling and upskilling as an ongoing process and work to ensure we implement the strategies, we as stakeholders decide upon together. We need to act before it is too late,” they said.

In her closing remarks, Dr Marthese Portelli, The Malta Chamber CEO, said that “our economy depends, directly and intrinsically, on a high standard of education in order to enable us to broaden our intellectual capital through successful human resource growth. For this reason, education must be continuous, relevant and attractive. The bottom line in education is not how much money we spend, but on what we spend it and how we spend it.”

The Malta Business Bureau, the Energy & Water Agency (EWA), and The Malta Chamber, hosted an event titled Sustainability in Industry: Different Perspectives. The scope was to provide a holistic and comprehensive overview of the path businesses need to take to become sustainable, ranging from core concepts such as double materiality, to the behavioural dynamics obstructing green growth. This webinar was the 11th of the WE MAKE event series, a collaboration between the aforementioned partners, funded by EWA. Through the project, the call to action for SMEs to become more sustainable is to begin with an energy audit, which can be funded up to 5000 euros. Those interested are to get in touch with the Malta Business Bureau.

Vice President of The Malta Chamber, Mr Mark Bajada, opened the event by stating:

“This consortium serves as a valuable resource, offering guidance, connections and resources to businesses seeking to embark on a sustainable path, and obtaining financial support. By fostering meaningful connections between industry, academia, business and policymakers, we can dismantle barriers, unlock opportunities and ensure industry’s sustainable growth.”

Dr Alex Mifsud, an academic versed in carbon literacy and sustainable development, presented an overview of the key concepts behind going green, while sustainability consultant Corinne Fenech explained how change is difficult both because of psychological obstacles to sacrificing in the short term for long term gains, and also because sustainability presents a social dilemma. Social dilemmas arise when individual self-interest conflicts with the collective interest, posing a challenging decision-making situation. These dilemmas occur in various contexts, such as the overuse of shared resources or the provision of public goods. In such scenarios, individuals face a choice between pursuing their own immediate benefits or contributing to the greater good. However, if everyone acts solely in their self-interest, it can lead to suboptimal outcomes, where the collective suffers. In a business context, these suboptimal outcomes may be understood via the concept of double materiality.

Dr Jonathan Spiteri from the Department of Insurance & Risk Management at the University of Malta explained that double materiality recognizes that the impacts of environmental factors, such as pollution, resource depletion, or climate change, can have material effects on both the financial performance of a company and the broader societal and environmental well-being. It is a concept that recognizes the interconnection between environmental, social, and governance (ESG) factors and their impact on both the financial performance of a company and the broader society and environment.

Double materiality emphasises the importance of assessing and managing risks and opportunities related to ESG factors that can have material impacts on both the financial bottom line and the well-being of stakeholders and the planet. By adopting a double materiality approach, companies can strive for long-term sustainable success by integrating ESG considerations into their strategies, operations, and reporting, and addressing the interconnectedness of financial and non-financial factors. By recognizing the double materiality of environmental factors, businesses are encouraged to consider the potential financial risks and opportunities associated with environmental damage, as well as the broader societal and environmental impacts.

The event concluded with an overview of the next steps which businesses can take to become energy efficient by participating in client journeys through the Enterprise Europe Network (EEN). MBB Senior Executive (Business Advisory & Support) Michele Agius  explained how client journeys enable a green transition for SMEs. Those businesses interested in taking advantage of these opportunities may reach out to MBB Senior Projects Executive (Sustainability) Timothy Alden at talden@mbb.org.mt

The Water and Energy Management and Knowledge Transfer in Manufacturing Enterprises (We Make) project, is a collaboration between the Energy and Water Agency (EWA), Malta Business Bureau and the Malta Chamber of Commerce, Enterprise and Industry, sponsored by the EWA, to give manufacturing industry businesses guidance on how to consume energy and water efficiently.

On the occasion of its General Assembly in Geneva today and as the EU enters a pivotal 12-month period, Eurochambres calls on policy makers to commit to Europe’s competitiveness and to getting the regulatory balance right.

With Spain about to take over the Presidency of the Council of the European Union, with one year left of the current EU legislative term and with preparations for the next five-year mandate gathering momentum, it is of paramount importance that political leaders seek to improve Europe’s deteriorating business environment.

Since the beginning of the current EU term in 2019, the European business community has been exposed to a high number of significant new policy initiatives and legislative proposals. The pursuit of the von der Leyen Commission’s policy objectives has continued unabated despite a global pandemic, the war, the energy crisis, international supply chain disruption and strong economic headwinds.

Businesses are struggling to keep pace with emerging new requirements, notably in relation to the green transition and to environmental, social and corporate governance. The digital and green transition can only be achieved if it is driven by a flourishing business community, but many companies have reached regulatory saturation point. Indeed, there is a sense among entrepreneurs that the EU is oblivious to the cumulative burden that its rules impose on the day-to-day activities of businesses.

While the new Commission target to reduce reporting requirements by 25% and its commitment to conduct regular competitiveness checks are both welcome, a more fundamental reset is needed, and an approach based on burden prevention rather than cure. The final 12 months of this EU mandate must be used to redress the regulatory imbalance swiftly and substantively. This should set the tone for a 2024-2029 legislative term that puts businesses front and centre to allow them to plan, invest, innovate, and employ.

Chambers act as a bridge between public authorities and the business community and as such are committed to providing concrete recommendations and support to the EU in getting the regulatory balance right. Europe remains an economic force and a source of progressive policy solutions to society’s challenges. Let us work together to ensure that this remains the case, for the good of our businesses and for the good of our citizens.

The full document can be downloaded here.

– Silvan Mifsud, Membru tal-Kunsill tal-Kamra tal-Kummerc, l-Intrapriza u l-Industrija

Jekk il-politika fiskali tkun waħda espansiva, fejn jibqgħu jingħataw sussidji fuq l-enerġija u fejn l-infieq tal-Gvernijiet biex itaffu l-effett tal-inflazzjoni jibqgħu jikbru, dawn il-miżuri jmorru kontra t-tnaqqis fid-domanda li qegħdin nippruvaw miż-żieda fl-imgħaxxijiet.

Dan ifisser li ndumu ferm aktar sabiex nrażżnu l-inflazzjoni, bir-riżultat li l-imgħaxxijiet ikollhom jogħlew aktar u bir-riskju li jkollna nidħlu f’riċessjoni pjuttost qawwija qabel titrażżen l-inflazzjoni. Għalhekk ftit tbatija issa tista’ tiskansana t-tbatija fil-futur. Dan intqal mill-ekonomista Silvan Mifsud, li hu ukoll membru tal-Kunsill tal-Kamra tal-Kummerc, l-Intrapriza u l-Industija f’intervista li kellu ma’ dan il-ġurnal, fejn irrimarka li l-inflazzjoni hi r-rata li bihom qed jiżdiedu l-prezzijiet fi żmien partikolari. Mifsud qal li l-problema hija meta din ir-rata ta’ żieda fil-prezzijiet tkun għolja wisq u tkun hekk għal żmien twil.

Qal ukoll li din jista jkollha konsegwenzi soċjali ħżiena filwaqt li l-miżuri li jridu jittieħdu sabiex titnaqqas l-inflazzjoni jistgħu jwasslu għal riċessjoni ekonomika. Huwa għalhekk li l-Bank Centrali Ewropew għandu l-mandat sabiex ikunhawn stabbilita’ fil-prezzijiet u li jkun
hawn inflazzjoni ta’ madwar 2%.

Meta mistoqsi minn fejn hi ġejja l-inflazzjoni, Mifsud spjega li din tista tkun ġejja minn tlett sorsi. L-ewwel sors turi x-xokkijiet li ġejjin min-naħa talprovista. L-ekonomist irrimarka li dan ġara hekk kif kellna tali xokkijiet li kienu ġejjin mill-ewwel pandemija tal-Covid-19 u imbagħad mill-gwerra fl-Ukrajna. Teknikamnet din tissejjaħ inflazzjoni “cost push”, fejn iż-żieda tal-prezzijiet provduti minħabba x-xokkijiet li kienu ġraw iwasslu għal l-inflazzjoni.

Mifsud qal li t-tieni s-sors huwa ż-żieda ta’ flus fl-idejn. Ġie spjegat minnhu li hekk kif ikun hawn aktar flus qed iduru fl-ekonomija, jkun hawn domanda aktar għal prodotti u servizzi u dan iwassal għal żieda fil-prezzijiet. Teknikament wieħed jista’ jirreferi għaliha bħala “demand pull”.

It-tielet u l-aħħar sors li jista’ jkun li qed toħloq l-inflazzjoni huma l-aspettattivi. F’dan ir-rigward, Mifsud qal li hemm element ta’ inflazzjoni li jiġi minħabba dak li s-suq ikun qed jantiċipa jew jistenna li jiġri. Jekk is-suq ikun qed jistenna żieda fid-domanda, hemm ċans li l-prezzijiet jogħlew minħabba f’hekk. L-ekonomista żied jgħħid li it-tali aspettattivi jistgħu jwasslu sabiex il-pagi jibqgħu jogħlew u jwasslu għal ċirku vizzjuż.

Fir-rigward ta’ kif qiegħed iħares lejn il-fatt li r-rata tal-interessi jidhru li se jibqgħu jiżdiedu, l-ekonomist Silvan Mifsud qal li l-Bank Ċentrali Ewropew m’għandux għażla oħra ħlief li jgħolli irrati tal-imgħaxx, bħala parti mill-politika monetarja tiegħu, sabiex jipprova jnaqqas id-domanda u jikkontrolla l-inflazzjoni, waqt li jirbaħ il-ħin sabiex il-problemi fissistemi ta’ provvista jissolvew.

Huwa qal ukoll li l-Bank Ċentrali L-ekonomista Silvan Mifsud Ewropew huma inkwetati bil-persistenza tal-inflazzjoni li għaddejin minnha. Sa issa l-Bank Ċentrali Ewropew kien qed jipprova jibbilanċja bejn iż-żieda flimgħaxxijiet sabiex jiġġieled l-inflazzjoni waqt li jniżżel id-domanda bilmod u ma jitfax l-ekonomiji Ewropea f’riċessjoni profonda.

Pero’ il-Bank Ċentrali Ewropew, jibża’ li jekk ma jibqax iżid l-imgħaxxijiet issa, se nispiċċaw biex l-aspettativi msemmija qabel, ikunu li l-inflazzjoni se tibqa’ għolja fit-tul, li jwassal li l-Bank Ċentrali Ewropew jkoll jgħolli l-imgħaxxijiet ferm aktar u għal aktar żmien fit-tul, li żgur imbghad jitfa l-ekonomji Ewropew f’riċessjoni kbira – xi ħaġa li l-Bank Ċentrali Ewropew qed jipprova jevita.

Jista’ jagħti l-każ ukoll li l-inflazzjoni tista’ twassal għal riċessjoni. L-opinjoni tal-ekonomista Mifsud fuq ir-relazzjoni ta’ bejn l-inflazzjoni u r-riċessjoni, huwa qal li jekk l-inflazzjoni ndumu sabiex nrażżnuha, dak ikun ifisser li l-aspettativi ta’ kulħadd huwa li l-prezzijiet se jibqgħu jgħollew fil-futur.

Dan għalhekk jista’ iwassal sabiex innies jibdew jibżgħu u jnaqqsu in-nefqa tagħhom fuq ħafna affarijiet, speċjalment dawk mhux neċessarji. Huwa qal ukoll li barra minn hekk il-politika monetarja tkun trid tibqa’ tgħolli l-imgħaxxijiet għal ħafna aktar żmien.

Misfuq saħaq li dan kollu jista jwassal għaltnaqqis drastiku fid-domanda li jwassal għal riċessjoni qawwija fejn jitkissru xi negozji. F’dan ir-rigward huwa qal; “Filwaqt li għandna bżonn nikkalmaw ftit id-domanda ma rridux nġibu kollass fid-domanda għax l-ekonomija għandha bżonn l-istrutturi ekonomċi tagħha (innegozji) jibqgħuu għaddejin għal meta
jkollna aktar stabbilta’ fil-prezzijiet”.

L-ekonomista qal li huwa għalhekk importanti li kemm il-politika monetarja u anke fiskali jaħdmu id f’id sabiex dan ixxenarju jiġi evitat. Hawnhekk żied jgħid; “Huwa importanti ħafna li meta nitkellmu fuq prezzijiet u fuq x’qed jikkawża l-inflazzjoni, dan isir fil-qafas ta’ analizi xjentifika u mhux waħda superfiċjali”

L-ekonomist Silvan Mifsud temm jgħid li huwa importanti li n-negozji jaraw kif se jsiru aktar effiċijenti fil-mod kif jaħdmu ħalli jżommu l-ispejjeż tan-negozji tagħhom taħt kontroll. Dan sabiex jkunu jistgħu jnaqqsu il-pressjoni fuq jekk u kemm iridu jżidu l-prezzijiet tagħhom.

Huwa qal li min-naħa l-oħra l-ħaddiem huwa importanti li jifhem li żieda fil-pagi, sena wara sena, sabiex jagħmlu tajjeb għal żieda għolja fil-prezzijiet ma tkunx se tgħinhom sabiex jkollhom is-saħħa tal-pagi tagħhom. Qal ukoll li jkun aħjar li għal xi żmien l-ħaddiema jaraw kif se jibdlu l-konsum tagħhom sakemml-inflazzjoni tiġi taħt kontroll.

Dan l-artiklu ġie ppubblikat għall-ewwel darba fuq talk.mt fid-19 ta’ Ġunju 2023.

Earlier today, The Malta Chamber of Commerce, Enterprise and Industry, through its Health and Wellness Committee which is sponsored by Atlas Insurance, organised an event to raise awareness on the need for a fire safety legislation in Malta.

Fire safety is an area of great concern for the general public, insurers and also for health and safety professionals. Malta currently follows a set of guidelines that are now out of date and which in themselves do not hold the power of law, while the new Fire Safety Act still awaits ratification.

In her introductory speech, Catherine Calleja, Council Member and Chair of the Health and Wellness Committee within The Malta Chamber, said “what The Malta Chamber is pushing for is to have a single piece of legislation which can be updated regularly to ensure that working or living in Malta is as safe as in other comparable jurisdictions.  Fear of retrofitting is not a justifiable reason for delay.  Transition periods to comply must be given but we have to start somewhere. The longer we delay the more expensive retrofitting will be. Resources for enforcement must be provided.  It is useless having legislation in place and no provision for enforcement.  Otherwise, it is just a matter of time before we are ‘too late’ to prevent another tragedy.”

“This standard is therefore about people’s safety and people’s lives. The drafting of the standard has to be the result of a solid interface between the Building & Construction Authority which is responsible for building codes together with the Civil Protection Department that has various important responsibilities in relation to this specific topic” said Hon Stefan Zrinzo Azzopardi, Minister for Public Works and Planning.

When asked about who will take the role of enforcing the new legislation once it is in place, Ing Antoine Bartolo, Chief Officer at the Building and Construction Authority said that “the authority is looking at the resources required for the enforcement of this legislation.”

Peter Paul Coleiro, Director General at the Civil Protection Department, gave an overview on the current realities. “A holistic approach is the way forward. Together with the Building and Construction Authority, and the input from various stakeholders, we have drafted a fire legislation which is in its final stages. Emphasis is also being made on educating the young about fire safety and we have started discussions on getting courses for those who are interested in the profession,” he said.

During one of the panel discussions, Dr Marthese Portelli, CEO of The Malta Chamber, started off by saying that The Malta Chamber goes beyond simply representing its members, but ensures that its policy proposals are for the general benefit of the entire community. “As The Malta Chamber, we are after clarity and responsibility. Rather than a lot of sporadic legislation falling within the remit of various entities, departments and enforcement officers we are pushing for a main law which regulates fire safety and which gives the legislator enough flexibility to be able to legislate further and amend easily. The Malta Chamber is also advocating that everybody needs to bear their fair share of responsibility,” she noted.

Dr Portelli also highlighted how fire safety ties into proper governance structures and policies, the relationship between energy-efficient solutions and fire safety, as well as the relationship between quality and fire safety. In terms of public procurement, she insisted that one should move away from the ‘cheapest compliant’ as ‘cheap products mean cheap safety’.