Making sense of Davos

January 9, 2012

When the World Eco­nomic Forum pub­lishes a well-researched report on global gender gaps, sus­tain­able con­sump­tion, water secur­ity or com­pet­it­ive­ness, it fuels global debate. When it gath­ers its Mem­bers from the busi­ness world with oth­ers from a broad swathe of soci­ety (aca­dem­ics, artists, politi­cians, human rights cam­paign­ers, trade uni­on­ists, envir­on­ment­al­ists and more), it becomes either the sin­is­ter archi­tect of a global con­spir­acy or the con­vener of a point­less gab­fest: Weltver­schwörung or waffle.

So what is the Forum? I can’t pre­tend to give you the defin­it­ive answer, but I can tell you how I make sense of it, hav­ing spent my work­ing life in tele­vi­sion news and higher edu­ca­tion. It might be help­ful to start by say­ing what it isn’t.

It is not a lob­by­ing or advocacy group. The world’s biggest com­pan­ies have little dif­fi­culty in secur­ing private meet­ings with whom­so­ever they choose. Politi­cians have good reas­ons to meet with com­pan­ies who might be employ­ers, and fin­an­ci­ers who might be investors. Trade asso­ci­ations, employ­ers’ groups and national cham­bers of com­merce all host such meet­ings and cam­paign on behalf of their mem­bers. This is not the role of the World Eco­nomic Forum.

It is not a net­work­ing asso­ci­ation. The Brit­ish prime minister’s coun­try res­id­ence at Chequers has long played host to eclectic gath­er­ings where journ­al­ists, bankers and celebrit­ies are encour­aged to rub shoulders. Doubt­less there are inter­est­ing con­ver­sa­tions over the marmalade, but that’s not the role of the World Eco­nomic Forum either.

So, what is the Forum’s reason for being? There is a Ger­man part to the explan­a­tion and a Swiss part. For the Ger­man part, you have to step back to the coun­try post-World War 2: des­troyed by extreme nation­al­ism; divided by com­mun­ism; its West­ern lead­ers seek­ing to rebuild their industry on a model that could also rebuild their society.

That pro­cess meant re-imagining indus­trial polit­ics. At its heart was the idea that busi­ness did not exist simply to serve share­hold­ers. Instead, an enter­prise should recog­nize its place within a con­stel­la­tion that includes employ­ees, sup­pli­ers, con­sumers, neigh­bours and bey­ond – its “stake­hold­ers”. For a firm to be account­able only to share­hold­ers was too nar­row. Cor­por­a­tions needed to embrace their broader respons­ib­il­it­ies as social, polit­ical, intel­lec­tual, cul­tural and even artistic or spir­itual act­ors. And under­stand­ing those respons­ib­il­it­ies required interaction.

The idea doesn’t have an easy Eng­lish label, and it is hardly in com­mon cur­rency. The Forum calls it the “multistake­holder” prin­ciple, and that prin­ciple extra­pol­ated to a global level is what gath­ers Mem­bers of the World Eco­nomic Forum with other global stakeholders.

The World Eco­nomic Forum has one simple motiv­a­tion in bring­ing people together – “con­ven­ing” in the jar­gon of inter­na­tional organ­iz­a­tions. It believes that its Mem­bers can only truly under­stand their interests by encoun­ter­ing the interests of others.

Then there is the Swiss part: par­ti­cip­a­tion. Per­haps it reflects the tra­di­tion of moun­tain com­munit­ies that respons­ib­il­ity be shared, that every view must be integ­rated, that one can­not simply abrog­ate one’s mem­ber­ship in a com­munity. It is an old idea. It was prob­ably old when it was artic­u­lated by one of Geneva’s most fam­ous sons, the polit­ical philo­sopher Jean-Jacques Rousseau. For the Swiss, it is a prin­ciple of their demo­cracy – the Konkord­anz­sys­tem.

That demo­cracy at fed­eral, can­tonal and town level is con­sul­ted in the pre­par­a­tions for the Forum’s Annual Meet­ing in Davos. Davos is an independently-minded moun­tain com­munity, steeped in Switzerland’s dir­ect demo­cratic tra­di­tion. Its alti­tude and an enter­pris­ing doc­tor, Alex­an­der Spen­gler, made it a des­tin­a­tion for well-heeled tuber­cu­losis suf­fer­ers. Thomas Mann set his com­edy of ennerv­a­tion, The Magic Moun­tain, in one of its san­at­oria. Albert Ein­stein helped kick-start its repu­ta­tion as an intel­lec­tual retreat (video).

Davos today is a work­ing alpine town. The town’s tour­ism is a func­tional con­trast to the chocol­ate box world of Vil­lars, Zer­matt and St Mor­itz. The Forum’s Annual Meet­ing boosts the local eco­nomy, but not its winter sports. Barely one-fifth of those par­ti­cip­at­ing can be accom­mod­ated in a five-star hotel. The local ski-lift com­pany has con­tem­plated shut­ting the lifts dur­ing the Meet­ing. When I’m there, as a mem­ber of the Forum, I sleep on a single bed and share a bath­room. Hard­ship? Not really, but it is work.

And that suits the Forum, because it deals with the world as it is, not as it would prefer it to be. It is not a decision-making body. Nor is it a con­spir­acy in which the horo­lo­gical com­pon­ents of global gov­ernance and industry are wound together to frus­trate the rest of the world.

For the busi­nesses and organ­iz­a­tions and indi­vidu­als who come together in Davos, the oppor­tun­ity simply to meet with one another, to think out­side their usual entour­age of attend­ant coun­sel and advisers, and to have no pre­de­ter­mined out­come assigned to every encounter is both a relief and an oppor­tun­ity. It brings together com­pet­it­ors and col­leagues, prot­ag­on­ists and ant­ag­on­ists, the well respec­ted and the heart­ily reviled, without requir­ing all who enter to adhere to its pre­cepts or accept its principles.

It is an incre­ment­al­ist organ­iz­a­tion. It moves slowly, and a diverse fund­ing base means that it is not a host­age to any interest. Much nego­ti­ation and plan­ning is required simply to arrive at a con­sensus around which debate can take place. But when that con­sensus is achieved, move­ment can be profound.

Fabi­ans would recog­nize the bene­fits of a plat­form from which Nel­son Man­dela could announce his eco­nomic policy for the post-apartheid era in South Africa. It can inspire extraordin­ary acts of phil­an­thropy, like those of Bill and Melinda Gates. It can provide a global micro­phone to someone like Aung San Suu Kyi. Like any plat­form, its power comes from the people who stand upon it, and their power in turn derives from the strength of their organ­iz­a­tions, their office or their ideas.

At any gath­er­ing of the power­ful, most often power remains frus­trat­ingly unwiel­ded. Swords stay planted in stones. And so there is frus­tra­tion. Why doesn’t the Forum DO some­thing? Why does it take in coun­try X, leader Y? Why does it nudge gently rather than poke aggress­ively? How can it let things stay the same?

Every­one who works for a com­plex organ­iz­a­tion makes com­prom­ises. Some­times those com­prom­ises come off, and the reward is pro­gress. Some­times they don’t. Encour­aging power to accept respons­ib­il­ity can be a cover for expedi­ency, but it can also prompt change. Organ­iz­a­tional cul­tures are self-reinforcing. If enough people within an organ­iz­a­tion judge their own con­tri­bu­tion by its mis­sion “to improve the state of the world”, it puts a value to their work and gives them meaning.

The world remains a com­plex and dys­func­tional place. Yet it is a big­ger and bet­ter place than the world I grew up in, in the world’s first indus­trial eco­nomy. In the early 1970s, women like my grand­mother wore head­scarves to go to mar­ket; heat and water came from coal scraped from scuttles; and a job meant simply work for men – labour that was fuelled by tinned food and for­got­ten with weak beer, the wire­less and the foot­ball pools. And this life was the best on offer for the most-favoured mil­lions. This was the world in which the Forum was created.

I am con­vinced that eco­nomic pro­gress can drive social and polit­ical pro­gress. Later this month, the World Eco­nomic Forum, under the rub­ric of the theme of its Annual Meet­ing – The Great Trans­form­a­tion: Shap­ing New Mod­els – will ask par­ti­cipants in Davos to think again about how the world works. The Forum too recog­nizes that even its own model needs to be ques­tioned. Often and regularly.

Cross­pos­ted from Forum:Blog.

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