WEF: The Defending Champion
In 2003, SustainAbility participated in both the World Economic
Forum (WEF) in Davos, Switzerland and the World Social Forum
(WSF) in Porto Allegre, Brazil. John Elkington, co-founder and
chairman of SustainAbility, went to WEF in Davos, where he was
a panelist in three sessions; Seb Beloe, a director at SustainAbility,
went to Porto Alegre, where the firm co-hosted a session on
its NGO research with the United Nations Global Compact
Office. The following article provides their views of how it
went in the third round of the title fight.
For more information
on WEF, visit
For more information
on WSF, visit www.forumsocialmundi
The first thing that
struck me about the WEF meeting in Davos was a profound shift in
mood since January 2002. In New York, the focus had been on the
9-11 attacks and their immediate aftermath. Just a few months after
those terrible events, America was still seen as the victim. This
year, by contrast, there were fewer Americansand they were
under intense pressure because U.S. forces were massing for the
much-heralded attack on Iraq.
Whatever one may think about Saddam Hussein or about the proposed
war, many WEF speakersparticularly those from the NGO worldwere
opposed. To applause, Kumi Naidoo, CEO of the NGO umbrella organization
Civicus, challenged the views of U.S. Attorney-General John Ashcroft
that terrorism is an attack on the rule of law. Ashcroft
and his colleagues were adamant that Iraq was a fair target, whereas
Naidoo argued that terrorism doesnt happen in a vacuum. People
need to feel they have an economic, a political and a cultural stake
in the planet, he said.
How have the big issues changed?
Whether a given session focused on Iraq, HIV/AIDS or competitiveness,
however, we kept returning to the theme of the 2003 WEF meeting:
Building Trust. When Klaus Schwab kicked off the Davos event, he
stressed that never before in the 33 years of the World Economic
Forums history has the situation in the world been as fragile,
as complex and dangerous as this year.
Trust, he said, is the foundation of all personal relationships.
It is the foundation of all business. It is the foundation of all
international relations. In our increasingly interconnected world,
trust is the rock on which we all depend.
Unhappily, as he and others pointed out, levels of trust are declining
worldwide. Much reference was made to the results of a 2002 survey,
designed by Environics International (www.environics international.com),
carried out by Gallup International (www.voice-of-the people. net)
and launched by WEF. Polling 36,000 citizens in 47 countries on
six continents, the survey was billed as representative of 1.4 billion
peopleand the results showed that trust was lowest in national
legislative bodies and in large companies.
Climate change was a major issue again this year, although panellists
in one session chaired by Eileen Claussen, president of the Pew
Center on Global Climate Change, concluded that the environment
is increasingly taking something of a back seatovertaken
by such issues as recession, war and HIV/AIDS. Last years
World Summit on Sustainable Development, said Jonathan Lash, president
of the World Resources Institute, had been seen as pretty much an
irrelevance and pushed aside. But new evidence suggests abrupt
climate change could produce impacts far greater than most
people yet imagine, warned Robert Gagosian, president of the Woods
Hole Oceanographic Institution.
How does WEF see WSF?
I didnt ask Klaus Schwab this question directly, but as the
defending champion, its easy to imagine that many
at WEF see the WSF folk as interlopers, upstarts. When youre
33, a three-year-old doesnt feel like much of a threat. But
WSF, despite its teething problems, is proving to be a pretty energetic
challenger even so.
I suspect that many of the more traditional corporate WEF supporters
still think that the decision to let in more NGOs to the Davos event
in the wake of 1999s Battle of Seattle was a strategic
mistake. And the fact that there was a serious falling out between
WEF and Friends of the Earth in the closing hours of the summit
probably confirmed their fears. But the pressures to forge connections
between WEF and WSF are growing.
Many NGOs I talked to in Davos stressed that they also had people
(and generally more of them) in Porto Alegre. Most say they intend
to build stronger links in future years. But, interestingly, these
are also pretty competitive organizations. A few of the longer-established
NGOs, behind the scenes, expressed real concern that they had let
the WSF initiative explode into a niche which should have
Is the gap closing or widening?
If youre an optimist, the gap is closingin that WEF
has made huge strides to address many of the issues that are now
central to the WSF agenda. Brazils President Luiz Inácio
Lula da Silva was the strongest bridge by far between the two events,
but even he noted that he had to defend his decision to come to
Davos. The best long-term outcome would be a progressive convergence
between WEF and WSF, since neither can achieve a knock-out.
But theres still plenty to be pessimistic about. I sat in
more than one session where corporate leadersincluding leaders
of much-attacked companiessounded remarkably complacent about
the challenges they face in relation to sustainable development.
And on the challengers side, there are major hurdles to overcome
before real convergence is likely. WSF is still pitched as an anti-Davos
eventand WEF is building a series of initiatives (including
its Global Leaders of Tomorrow and Social Entrepreneurs
programs), which might just conceivably be used to outflank WSF.
To ensure this doesnt happen, WSF is going to have to come
up with a coherent, pragmatic and saleable agendaand fast.
What was the mood in Davos?
Gloomy. The looming war clouds spawned sessions focusing on everything
from what would happen if someone launched a nuclear warhead to
the possible impacts on U.S. brands of Muslim boycotts. And, as
if war was not enough, a deep pall had been cast by the collapse
of the New Economy, the global recession and the recent corporate
scandals in the U.S.
We didnt hear much about silver linings, either. Hewlett-Packard
chief executive Carly Fiorina argued that the technology industry
would never regain the momentum it had gained in the 1990s. Interestingly,
an unexpected star of the event was Cristobal Conde, CEO of the
U.S.-based SunGard Data Systems, one of the worlds largest
suppliers of backup equipment for computer systems. A clear beneficiary
of turbulent times, he popped up on panels with titles like The
Occurrence of Another 9/11 and Its Impact on Business.
Some folks, though, simply didnt show. The media and entertainment
worlds, for example, were conspicuous by their absence. Davos
is a mogul-free zone, was the way the International Herald
Tribune put it. It also quoted Sir Howard Stringer, chief executive
of Sony Corp. of America, to the effect that this years WEF
agenda was to blame: The two themes of this year are rebuilding
trust in business and the war in Iraq. Thats not exactly cheerful.
Which were the most interesting voices?
Davos is still largely white men over 50, as various women whispered
in my ear as we listened to one all-male panel after another. Among
the big political guns, theres no question that former U.S.
President Bill Clinton still wins in the charisma stakes. Indeed,
one of the most memorable sessions was a late-night discussion between
Clinton, José Maria Figueres, former president of Costa Rica
(now WEF managing director) and Ernesto Zedillo Ponce de Leon, former
president of Mexico.
The discussion gave an extraordinary insight into how the near-meltdown
of the Mexican economy was avoided by Clintons bold $40 billion
loan, despite U.S. opinion polls running 80:15 percent against.
But how long will we have to wait before we see similarly-inspired
leadership in relation to the sustainable development agenda?
While the three ex-presidents often looked to the past, even if
they were seeking lessons for the future, others had their eye firmly
on the emerging agenda. Brazils President Lula, for example,
is very much a rising star. He was in no doubt about the need for
closer WEF-WSF links. I think the people in Davos should talk
to the people in Porto Alegre, he said. It is like management
and unions that seem to be far away in contract talks. But when
you sit down, the distance doesnt seem so huge.
Among other things, Lulas call for the Group of Seven rich
countries to support a new fund to tackle developing world poverty
was greeted with a degree of scepticism by business people, but
signalled his desire to give Brazil a much bigger role on the international
And the international stage is likely to see much drama, if you
believe WEF 2003. For example, people like George Soros argued that
China could impact the global economy as a deflation machine,
driving down the costs of production and, in the process, adding
to existing deflationary pressures.
For me, though, the most interesting voices in Davos were often
those of social entrepreneurs. Each year, the Schwab Foundation
for Social Entrepreneurship, created by Klaus and Hilde Schwab (www.schwabfound.org),
selects a number of individuals and organizations involved in social
transformation. Among the selection criteria: innovation,
sustainability, reach and scope, and replicability/ expandability.
Indeed, when I facilitated a WEF session on When Markets Fail,
Who Responds, one of the big questions that surfaced was how
such social entrepreneurs can be helped to scale up their operations
Wheres the agenda headed?
There had been six major streams of work through the meeting, each
of which was asked to boil down its side of the agenda to just five
priorities. On the final morning, the resulting 30 priorities were
to be further distilled into five overall priorities. But the process
went even further, resulting in just three WEF priorities for the
* Values: Trust, it was argued, could not be rebuilt simply
by developing new rules and standards. Instead, it was argued, business
needs to go much deeper, focusing on principles and values. Interestingly,
too, was a strong sense that these values would need to be externally
driven, with key roles for NGOs and governments in pushing things
forward and ensuring a moderately level playing field. There remained
significant differences between the Americans and Europeans, however,
on where to go next on corporate governance.
The corporate panellists in the final New Agenda session
were pretty much in agreement on this one. Values, said Boeing chairman
and CEO Philip Condit, are absolutely crucial within a company,
within an economy, for building trust. Lafarge chairman and
CEO Bertrand Collomb stressed that what is now needed is a new focus
on global governance. And Pfizer chairman and CEO Henry McKinnell
also underscored the need to focus on principles and values, which
he argued promote principled behaviour and creative solutions, rather
than rules and regulations, which he said promoted a race
to the bottom.
* Volatility and risk: At times the profusion of risks discussed
was dizzying. Bill Clinton noted that, with more weapons than food,
North Korea was using its missiles and bombs (some of them possibly
nuclear) as cash crops. In parallel, too, there was
a sense that business now faces an unparalleled convergence of political,
social and economic risks. In the past, companies had tended to
get into trouble because they have been in the wrong place
at the wrong time. Today, by contrast, the risks are systemicand
the solutions will need to be systemic, too.
Threats like those posed by HIV/AIDS are set to take the guts out
of the economies of many African countries, said Pfizers McKinnell,
by removing many of the best-trained adults. This is our Holocaust,
argued actress Julia Ormond (co-chair of FilmAid International)
of HIV/AIDS, accepting one of two annual Crystal Awards from Klaus
Schwab. She noted that the disease was set to kill more people than
World War I, World War II and the bubonic plague combined.
* The corporate role in sustainable development: Given the relatively
weak political impact achieved by the 2002 World Summit on Sustainable
Development, it was interesting to see that sustainable development
(SD) was seen as centraland the consensus at Davos 2003 was
that business has a critical role to play in making it happen. The
links between the SD agenda and global security were seen to be
direct and increasingly urgent. Indeed, panellists from around the
world used words like stakeholder and sustainability
with an abandon that would have been unthinkable a few years back.
As the closing session moved to its conclusion, mine was among a
small forest of arms raised when a final round of questions was
invited. I didnt get to ask my question, but it was a simple
one. Like most participants, I found the three priorities intellectually
satisfying, but also wondered what panellists like Collumb, Condit,
Figueres and McKinnell wanted to see happen in the next 12 to 18
months. What key performance indicators would they use to judge
progress by the 2004 and 2005 WEF meetings?
To answer my own question, I would want to see four things by January
* clear targets set by all companies and governments
involved in Davos;
* much stronger links with the
WSF community, including joint sessions on major issues, possibly
mediated by President Lula da Silva;
* a major new focus on what
can be done to help scale up the work of the social entrepreneurs
spotlighted and networked by the Schwab Foundation and others; and
* a new stream of activity focusing
on business models designed in line with the principles of corporate
citizenship and sustainable development.
The Challenger -
John Elkington is co-founder and chairman of SustainAbility. Established
in 1987, SustainAbility is a sustainable development consultancy focusing
on how the sustainable development (SD) agenda fits within business
strategy in environmental, social and economic termsthe triple
bottom line. For more information, visit www.sustainability.