Good morning.

The World Economic Forum in Davos is an easy target for cynics (see this and this for examples). But it is also an unmatched opportunity to take the pulse of global business leaders. And what emerged last week was a clear sense that the focus on technological transformation, which obsessed the Davos crowd for the last half decade, has been replaced by a discussion of stakeholder capitalism.

The two are related. On the flight home, I (belatedly) read Colin Mayer’s book Prosperity, which Microsoft CEO Satya Nadella touted during his comments at Fortune’s CEO dinner. Mayer provides a useful framework for thinking about the connection.

A corporation, he argues, is made up of different types of capital—financial, material, human, intellectual, social, natural. In the 19th and 20th century, financial and material capital were in short supply, and thus were the locus of power. All our systems of corporate control were built to measure and allocate those forms of capital.

But today, material capital is far less significant, and financial capital is abundant. A salient fact from the book:

“Forty years ago, 80 per cent of the market value of US corporations was attributable to tangible assets—plant, machinery, and buildings—as against intangibles—licenses, patents, and research and development. Today, intangibles account for 85 per cent of the market value of US corporations.”

Today, it’s human capital and intellectual capital, as well as social capital and natural capital, that are in short supply. And that means they hold the power. The shift toward stakeholder capitalism is recognition of that fact. Our accounting and management practices need to adjust to give them greater priority. That’s no small task, and one the Davos crowd deserves credit for starting to tackle.

*****************

By the way, there are two topics that CEOs generally don’t like to discuss in these conversations about business and society. One is CEO pay; the other is their proclivity for using tax havens. Fortune last week published a ProPublica investigation into a Microsoft tax dodge. You should read it here.

I asked Nadella about the two forbidden topics in our Thursday night conversation. On CEO pay, he answered somewhat cryptically:

“CEO pay is something that absolutely should be discussed. Steve Ballmer said to me when I took over: ‘You’re labor, I’m capital.’ And someone should think about the return to capital versus the return to labor.”

On tax, he came out in favor of a global minimum tax:

“I would rather have everyone pay 21% tax everywhere and not have all this nonsense.”

Sounds right to me. More news below.

Alan Murray
@alansmurray
alan.murray@fortune.com

TOP NEWS

Google antitrust

State attorneys general and the Justice Department will reportedly compare notes next week on their various probes into Google's online ad business and the firm's Android-related tactics. The unprecedented meeting could presage more formal cooperation. Wall Street Journal

China shutdown

The death toll from the Wuhan coronavirus now stands above 80, and almost 3,000 are confirmed ill. The national new year holiday has been extended through the end of this week—in order to stop half a billion people travelling as they otherwise would—and most companies in Shanghai are banned from returning to work until Feb. 9. Meanwhile, the crisis is hitting stock markets in Asia and Europe. Bloomberg

Huawei U.K.

The British government will reportedly allow Huawei to participate in the country's 5G network, albeit with a cap on its market share that's intended to stop the network becoming over-reliant on the contentious Chinese giant. If the U.K. does give Huawei the green light, the move will annoy the Americans, who have been lobbying hard for an outright rejection. Financial Times

Air India

The Indian government wants to sell its entire stake—that is, 100%—of flag carrier Air India. A couple years ago, the government tried to sell 76% of the debt-laden airline, but potential bidders shied away. The government wants control of Air India to remain with an Indian entity. Reuters

AROUND THE WATER COOLER

Investor opinions

How do investors feel about the Business Roundtable's new statement of purpose, which marks a shift from shareholder to stakeholder capitalism? Fortune and Civis Analytics polled more than 1,300 investors to find out, and the results suggest they are open to throwing out business as usual. Fortune

Boeing test

Boeing has successfully completed a test flight of its 777X, the world's largest twin-engined plane. The four-hour flight was the craft's first—it was due to launch this year but technical difficulties got in the way. Boeing has already sold 309 of the plane, which rivals Airbus's A350-1000. BBC

Payment software

Visa and Sapphire Ventures have joined in an $80 million funding round for a British startup called Currencycloud, which powers cross-border payments for the likes of Monzo and Revolut. Google and the World Bank's investment arm also participated in the round. CNBC

Kobe Bryant

The retired basketball legend Kobe Bryant and his daughter Gianna—along with seven others—died in a helicopter crash in California yesterday. Due to the location of the crash site, it may take days to recover the bodies. Fortune

This edition of CEO Daily was edited by David Meyer.

Correction: an earlier version of the 'payment software' blurb did not take account of the fact that Sapphire Ventures was spun out of SAP in 2011 and now operates entirely independently.