Davos is not that far - diving deep into the WEF

Last year, the World Economic Forum completed over half a century of existence.?

A week ago, the 53rd convention at Davos came to the conclusion that it would take over 230 years to eradicate poverty if we steer as per the current rate of development.

While the annual WEF conference is one of the most awaited events of the year, I felt like digging deeper, and focusing especially on its linkage between Economics and Sustainability which set a global precedent of the same.

A couple of months ago, I wrote about how ‘Sustainable Development’ came about in ‘Breaking down the Brundtland Commission’, and today I spent the day reading about Klaus Schwab, founder of the WEF and his connection to where the world stands today.

The World Economic Forum started with an idea which is too common for us to process as a breakthrough, but it was at the time.

In the world healing from a lot of wars, and stepping into some more, in 1970, Professor Schwab, a German Engineer and Economist had an idea.?

The STAKEHOLDER THEORY.

In 1970, the USA, USSR, Germany, Japan and France made the top 5 economies as per GDP.

Today, it is the USA, China, Japan, Germany and India.

While some of the names remain the same, a geopolitical shift remains evident and everlasting over the last five decades.

If we all think about it, tangible changes include population, globalisation, openness of business, diversity of professional options, solidified governance supplementing the changing world order and values of global currencies.

But intangible changes, most importantly, include accountability.

I haven’t lived in 1970, but the amount of change of scene in the last 20-25 years, is enough to make me realise how business and perception of business has become incredibly inclusive.

Back in the day, the consumers had no choice. Everything that entered the market was new, and hence it sold. But today, the consumer is the king. Demand justifies Supply, and everything is customizable.

I work in ESG, and I am attuned to believe and to justify that corporations are the biggest drivers of change in society.

If we talk about the everlasting impact of oil and gas, it also started with industry and business, and in today’s?age, on the contrary, sustainability has become the biggest business case.

That is because businesses over the years have themselves or have been forced to understand the level of their impact. They have been the drivers of climate change, and they can be the drivers of climate mitigation as well.

Let us think about it in this way - it is taking so much effort to discard polythene and single use plastics from all our lives. But when it was made as a byproduct of petroleum, it was a eureka moment for the whole world.

The changing shape of business and the increasing importance of the customer has justified Professor Schwab’s Stakeholder Theory even more over the years.

Just like the Donut Economy, we all get a part of the pie. Similar to what ESG says and so does the Triple Bottom Line.

Davos started as a workation (as we might’ve said today), for industrialists back then for a retreat and reflection in the Swiss Alps.

Back in 1971, at the first Davos Annual Meet, the concept of social consciousness for business came up and Prof. Schwab’s wife, Hilde Stoll started her own Organisation - the Schwab Foundation for Social Entrepreneurship - probably a first attempt at impact investing and social sustainability.

The World Economic Forum, today stands at a stage where all of us follow it and look at it as an ideal, but over the years, the organisation has taken note of, and stood for change and mitigation way ahead of time.

In 1973, the Davos Manifesto was outlined. Based on the core principles of Stakeholder Theory, it has been then updated almost every single year.

In 1976, the convention was able to bridge a gap between the West and the Arab world through the first Arab-European Business Cooperation, just after the Arab-Israeli war and a heavier oil economy globally.

If we draw a parallel, we realise that Klaus Schwab was born in the war-ridden epicentre Germany in the beginning of the 2nd World War.

Where accountability was extremely dimly lit, he started his journey with the idea of equity and responsibility - a mirror of what the world needed and will always need, in business or otherwise.

He started the Annual Davos Meet in Davos, Switzerland - a neutral country. A country which has essentially believed in safeguarding itself and taking responsibility for its conscious decision making.

The World Economic Forum, has over the years transpired, inclusion in ways more than one.

From opening the door to China, when the country started transforming to trying to resolve the after effects of the Cold War, through collaboration and business, the WEF also ended up averting a war between Greece and Turkey and reaching resolution.

It stood tall when the Berlin Wall was brought down and it played a major role in ending the apartheid with constant collaboration with Nelson Mandela and South Africa.

We spoke so much about G20 this year, but the first G20 ever was born in Germany through the WEF, and later, so was the G8, a key global economic convention today.

In the last year of the 20th century, WEF collaborated with the United Nations and spoke about ‘Responsibility Globality’, highlighting the social responsibility of business and thereby forming the UNGC commitment (United Nations Global Compact).

It was the World Economic Forum which released its first Gender Gap Report focusing on women’s empowerment, gender equality, pay parity and a breakthrough through the American recession.

The WEF stood by strong for the #METOO movement, developed the world’s, first all-female business and responsibility panel and while sustainability was at its foundation from the time of inception, in 2019 the organisation collaborated with Sir David Attenborough and Greta Thunberg to shed light on Environmental Sustainability and Business Responsibility, a year before officially adopting the Sustainability Development Goals and helping governments facilitate achieving their 2030 targets as well as reach the goal of the Paris Agreement.

In 2023, the Annual Meeting in Davos spoke about a fragmented world and the ‘Global Risks Report’, which portrayed energy security, technological risks, and the climate prices as foremost risks in today’s world.

As I enlisted all achievements and breakthrough observations by the World Economic Forum, I realised once again, the power of global corporations and having an individualistic effort and better focus can lead to incredible change.

Professor Schwab wasn’t aware of the impact his thought leadership was going to have on the world, and today we look up today as a game changer, setting precedent for the rest of the year.

But the WEF since day one has been talking about accountability for each and everyone - it is subjective and yet transformative.

This year, the annual meeting at Davos declared the wealth inequality to be so bad that it could take over 200 years to eradicate poverty, and the first trillionaire could be found within a decade.

While the rich become richer and the gap widens, is it a time to back up a bit and reflect within and transform the stakeholder theory for a new world and for a newer us?

This is my takeaway from last week.?

All in Good Time, but intent turning into action means the most.

I’ll try to do a detailed analysis on Poverty and Sustainability sometime soon, but thank you for reading :’)