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The World Economic Forum will focus on how to dig out of the worsening global financial crisis. Let's hope for some fresh ideas
As it has done for more than three decades, the World Economic Forum's annual meeting in Davos (Jan. 27-31) will bring together leaders from around the world in business, government, academia, society, and the media to discuss world affairs. For five days delegates will talk, brainstorm, and forge alliances to tackle top issues on the global agenda.
Looking back over WEFs past, it's hard to think of a more perilous context or more challenging issues. This year's principal theme is "Shaping the Post-Crisis World." Humbled financial-services executives will join with their counterparts in other industries and other sectors to discuss ideas on how to dig out of the avalanche that is smothering the global economy.
The leaders of the WEF have focused on some long-overdue changes that may be required and enabled by the current crisis, and that ultimately could position the planet for stability, growth, sustainability, and justice. Klaus Schwab, who founded the organization in 1971 and also serves as its chairman, told reporters last week that the meeting is among the most crucial in the organization's history. "What we are experiencing is the birth of a new era, a wake-up call to overhaul our institutions, our systems, and, above all, our way of thinking," Schwab said.
Music to my ears; I'll be looking for fresh and innovative ideas for fundamental change.
The Davos meeting is not designed to achieve one all-encompassing statement of beliefs at its conclusion, such as we see at G8 summits. Rather, it brings together leaders from around the world who would otherwise not meet one another in the normal course of business. Bono can talk to Bill Gates, who in turn talks to Tony Blair, Indra Nooyi, Michael Porter, and Condoleezza Rice. Delegates find issues of common interest and form new relationships that will help one another achieve their goals.
Attendees are not permitted to bring staff of any kind—the only guests are spouses. Accommodation is modest as CEOs of Global 100 corporations find themselves staying in three-star hotels in this small, overcrowded skiing town. But as someone who has attended the event for over a decade, I can say that the intellectual stimulation and initiatives that are catalyzed make up for any shortcomings. From my experience, many of the best discussions are in small meetings, in hallway conversations, in the bar, or over dinner.
I'll be blogging for BusinessWeek during the event. Here are some of the many issues and sessions that have grabbed my attention:
Rethinking the Financial Services Industry
In my view, fresh capital and updated regulations are not enough to solve the current crisis and reboot the system. Bankers and business leaders should collaborate around a private sector solution to the chronic problems undermining the financial services marketplace. They need to rethink many assumptions of the industry's basic modus operandi. To restore confidence to America's bludgeoned financial services industry, we need a new operating model based on unprecedented transparency and the sharing of intellectual property among all players. Rebuilding trust takes total transparency, which is completely feasible and affordable in a digitized world. As financial instruments became more complex, they became more opaque, which has proved disastrous. Sunshine is the best disinfectant, and it's what smart digital tools would provide.
The Future to Democracy
Basic democratic institutions are at risk and in danger of failing due, in part, to the economic crisis in poor countries. (The best predictor of democratic survival is per capita income.) In developing countries, democracies have been captured by military, organized crime, or tribes. Given the crisis, it's easier for authoritarian regimes to make the case that democracy is inferior or an unnecessary luxury. Close to home, the Securities & Exchange Commission became beholden to the investment banking community.
At the same time, the Internet provides a new global platform for government and citizen engagement. One WEF working group put the opportunity well: "A new kind of public sector organization is required in response to these challenges—one that opens its doors to the world; co-innovates with everyone, especially citizens; shares resources that were previously closely guarded; embraces transparency as a modus operandi; harnesses the power of mass collaboration; and behaves not as an isolated department or jurisdiction, but as something new, a truly integrated organization. The breakthrough enabled by new technologies is found in collaborative, cross-organizational governance networks that leave behind outmoded silos and structures. We call this Government 2.0."
As an example, one session, called "Power to the People: Politics in the Internet Age" was inspired by President Barack Obama's 2008 campaign. It examines future threats and opportunities for democracy in the Digital Age.
Fresh Thinking from Government Leaders?
Clearly, a global leadership crisis has emerged. Russian Prime Minister Vladimir Putin will address the meeting on its opening day. So will Chinese Premier Wen Jiabao, amid unease over China's ability to provide an urgently required engine of growth for a stalled world economy. British Prime Minister Gordon Brown, wrestling with a recession and a massive bank bailout that he's promoted as a model for governments everywhere, is also scheduled to speak. Other world leaders attending include U.N. Secretary-General Ban Ki-Moon, German Chancellor Angela Merkel, and Mexican President Felipe Calderon. Notably missing will be the leader of the world's largest economy and arguably the freshest thinker on the global scene, U.S. President Barack Obama. The timing of the event—during his second week in office—could not have been worse. He is supposed to be represented by senior adviser Valerie Jarrett and Sheila Bair, as well as Laura Tyson, a professor at the University of California at Berkeley who advised Obama during the Presidential campaign. I'm looking forward to meeting with them.
A New Era of Global Cooperation?
There will be a lot of discussion about the need for better collaboration on a global scale—dare I say global governance? Clearly, domestic regulation is the wrong fit for the global financial services marketplace. Increasingly, the problems of the world—from economic stability to the reindustrialization of the planet to global warming—cannot be solved on a national basis. The WEF has many initiatives in this area, and arguably it could become instrumental in addressing the global crisis of leadership that exists.
One example is a bold attempt by the WEF, called WELCOM (the World Economic Leaders COMmunity), to create a global communications platform for the world's leaders to solve problems, exchange knowledge, respond to crises, and better govern on a global scale overall. WELCOM is rolling out a range of innovative tools for locating and gaining access to expertise, sharing knowledge, and meeting and working with peers. I'm deeply interested in this initiative and am looking forward to seeing its progress and next steps.
The Tapscott Blog. I'll be reporting daily from Davos. Please send me your questions and thoughts, and I'll do my best to respond. You can read me through Twitter.