New Delhi: Blaming failure of leadership in corporates and governance across the globe for the financial meltdown, PepsiCo Chairperson and CEO Indra Nooyi on Thursday said the world is "now experiencing a severe crisis of expectations".

Addressing AdAsia 2011 here, Nooyi said when the downturn set in, "creativity gave way to fear and risk triumphed over ingenuity. As a result, I think we are now living in the midst of three inter-locking crises."

Describing leadership as the first crisis, she said, "At the top of some famous companies, responsibility went missing. One of the great tasks of leadership is to prepare for events, to be ready for when the storm comes. On any measure, leadership failed that test."

The problem was further compounded by failure of governance, she added.

"Accountability and oversight went missing too. Nobody said stop when bad practice was developing. Governance failed and it failed badly. The result of poor leadership and even worse governance is that we are now experiencing a severe crisis of expectations," Nooyi lamented.

Consequently, she said, "Businesses, regulators and governments are now unsure what success looks like. This complex world feels out of control."

She further said, "Governments are struggling to cons TRAI issues within their national boundaries. Financial, political or social instability in one region spills over into another."

Nooyi also blamed "exotic financial instruments" for introducing complexity into markets "which got way ahead of the understanding of regulators".

Describing the present as "the era of negative uncertainty", she said: "Trust in established brands and institutions have diminished. Businesses are left struggling to keep up." Yet, she said the world should be careful not to fall into pessimism.

"This is also a world abundant in opportunity, if we know how to navigate it. The global economy, which is USD 62 trillion on Thursday, is likely to be USD 300 trillion or more by 2030 and most of that growth will be powered in places like this. The middle class is going global."

She also said much of the growth is being powered by women who are emerging as great 21st Century leaders. 

"Across the globe, women are the biggest emerging market in the history of the planet—more than twice the size of India and China combined," said the PepsiCo Chief who was named the most powerful woman in corporate America by the Fortune magazine last year.

"There is plenty to give us cause for optimism. But we need to know how to unlock the potential," she added.

(Agencies)