Business and political leaders took pains to address corporate sustainability issues at Davos, says Peter Davis, politics editor
A few weeks ago there was the annual jamboree of about 2,000 world leaders, corporate bosses and celebs crowding into the Swiss resort of Davos. The World Economic Forum has become the event of the year for the rich and powerful who want to hob-nob and discuss the future of the world.
For the past couple of years, the tone of the event has been rather subdued. The atmosphere at this year’s event was, according to those there, more upbeat. Upbeat, but not unrestrainedly so.
On one level, confidence does seem to be returning. For the past 14 years accounting and consulting firm PricewaterhouseCoopers has conducted a global CEO survey to find out what corporate bosses are thinking about the year ahead.
According to this year’s worldwide poll of 1,200 chief executives, 48% said they were “very confident” of growth in the next 12 months. This is a big improvement on the 31% of last year and approaches the 50% who expressed this opinion in 2008, before the economic crisis struck.
This optimism is reflected in some of the comments made at the meeting. Ellen Kullman, chief executive of DuPont, for example, said that 2010 had been “a fantastic year for growth, and 2011 will still be good”.
However, this optimism appears to have been somewhat nuanced, as was reflected by the comments of Paul Bulcke, boss of food giant Nestlé. He said: “We are optimistic, but we are afraid to be optimistic.”
In part this caution reflects ongoing uncertainties in the global economy: the risk of a double-dip recession remains. The PwC survey highlighted concerns about access to capital, and the funding problems faced by many countries. However, it also points at real concern about more fundamental issues and how to respond to them.
This wider concern was reflected in some of the agenda items at this year’s forum. One debate was titled “What are the global risks at the top of the agenda in 2011?”. This focused on emerging security threats and on the growing economic disparity between rich and poor.
Another session looked at the role of business in development policy, focusing on sustainable development, public-private partnerships, infrastructure investment and skills development.
Cynics might say such sessions were there just for show: but such cynicism would seem to be misplaced.
Deeper concerns
One attendee of the WEF, speaking to Ethical Corporation, says these agenda items reflected a genuine “mood and tone” of the event that really focused on deeper concerns. According to this senior figure at a major international advisory firm, wider discussions among the leaders at Davos focused on issues such as resource scarcity and integrated nature of food, energy and water challenges. They examined the need, in addressing development challenges, for a move towards strategic partnerships between companies and the government, rather than just collaboration on particular projects.
The WEF can be viewed in one of two ways. Optimists can say that it provides a forum for the great and the good to establish what the key global challenges are on which they need to collaborate.
Pessimists on the other hand will see WEF as little more than a talking shop for the world’s leaders at which they pat themselves on the back, and which serves further to insulate them from the challenges faced by most of the world’s population. It is easy enough for the leaders at Davos to turn their attention to wider societal issues, but is that consideration going to continue during the rest of the year?
Arguably the most striking statistic from the PwC survey is the fact that, in 2008, 50% of chief executives said they were “very confident” of their corporate prospects for the coming year. These people were proven spectacularly wrong, since the following 12 months heralded arguably the worst peacetime recession since the Great Depression.
Has the fact that so many so-called leaders failed to anticipate such a major calamity made them more aware of un-looked-for risk? In hindsight, the economic crisis was entirely foreseeable; but this is also the case with many societal and ethical problems in which companies find themselves embroiled.
Does the apparently more considered nature of the debate at Davos this year reflect a more measured and humble approach: a recognition by the Masters of the Universe that they have feet of clay?
It is encouraging that, at the very least, issues of equity and of political risk were discussed at Davos. What’s more important is whether or not the corporate leaders at Davos act on these issues when they return to the office.