50th Anniversary of Davos requires Searching for its Soul

A thought to revisit a successful idea behind Davos

50th Anniversary of Davos

World Economic Forum turned 50 in 2020, and it is still focused on the “Stakeholder Capitalism” since the first World Economic Forum in 1971. Stakeholder capitalism vs. shareholder capitalism is a popular comparison, and the forum has taken the side of stakeholder capitalism. Having successfully completed goals aimed at international cooperation and development, the forum has some immediate challenges as it turns 50 in 2020. Paris Agreement on climate change and the Sustainable Development Goals indicators are some prominent challenges before it. It is relevant to refer to “The First Davos” taken place in 1971 when the founder Professor Klaus Schwab hosted it. A look at Davos through the years reveals that the World Economic Forum has already faced serious challenges. For instance, the world was divided as a result of continuing the Cold War. Vietnam War just ended and the United States was coming out from its effects. Apart from it, the oil crisis was looming in the world. This was the context when the World Economic Forum started its journey.

World Economic Forum has contributed to the World

Exactly, this is what is needed now for more effective and relevant action from the forum in 2020. Davos has always had critics over its way of functioning and results. Despite this fact, it has been offering a platform to the world where many international disputes have been prevented. Nations and multinational corporations interact with each other. It has resulted in stakeholder engagement in policy development. The world seems to be one organization, and all countries and organizations act as its stakeholders. Some areas like health and well being got much support from all stakeholders as the global vaccine alliance Gavi is its prime example. Gavi vaccine alliance was launched in the forum’s annual meeting in 2000. More than 700 million children have been immunized through the alliance that has estimated to save more than 10 million lives across the globe. Credit goes to the founder and world economic forum over this achievement. But this is only a bright and positive side of the picture. In a recent New York Times article, it has been highlighted that “Davos has become a punch line.”

New Ideals are shaping the World on 50th Anniversary of Davos

Certainly, the founder was busy before the World Economic Forum 50th-anniversary annual meeting in Davos, Switzerland. However, he did not seem to be satisfied with the goals and ideals he set at the time of forming the forum. He has evidence of why it is the case because the world is going to encourage and promote protectionism in trade in place of open borders in the world. Globalization has gone far from reality because the world is embracing the new realities and ideals. Open borders in the world were the obvious and inevitable consequence of globalization in international relations.

Liberal democracies in the world are facing a threat from new idealism in international relations as the world is embracing authoritarianism. Protectionism in trade is promoting new trends and views among people of a country. Leaders are raising the Populist Party campaign slogan protecting national interests is getting popularity. It joins with religious sentiments that take the situation to an extreme level. As a result, authoritarianism is getting its roots in place of liberal democracies in the world. It is also not in line with the stakeholder theory and its application at the World Economic Forum stage.

Then, there is a threat to the western capitalist culture of the Chinese economic system today. With high production capacity and relying on manufacturers over China, it is shaping the world scene. From the perspective of the World Economic Forum, stakeholder capitalism is facing the challenge. The centralized mechanism of the Chinese economic system today may not be suitable for stakeholder theory, where everyone has to contribute to common goals and objectives. It calls for a serious approach from the world leaders and executives from famous multinational companies. The question is getting much relevant in this context to know whether the world leaders and corporations are ready for sensitivity for each other. As Davos turns 50, this aspect should be in the mind of every leader and top executive participating in the forum.

More responsibility is on Attendees of the Forum

It requires World Economic Forum 2020 speakers to embrace the very objective of the forum, i.e., to make the world more cohesive and integrated. Despite the fact, the world is getting closer to protectionism and heightened nationalism. It is having common and shared problems and issues. Global warming and climate change are among those issues that require world attention. Every country has to feel the pain as these issues are affecting and keep affecting how countries treat each other. It also calls for leaders to emit less carbon into the atmosphere.

When guests would come to the World Economic Forum on private jets, it would be farfetched to think they would work to reduce carbon emission. They do not have to act like elites as they come to the forum to represent the world. In this world, millions of children are not going to school and a large population does not have access to clean water to drink. The world’s collective effort towards climate change, i.e. the Paris Agreement on climate change, is facing uncertainties. Attendees of the forum express their concerns over inequalities in the world. Inequalities are there in terms of compensation and social treatment. However, their way of life looks like as elite. The forum has to adopt a common culture where mutual responsibility emerged. World Economic Forum 2020 theme should start having a worldwide purpose of shared responsibility and stakeholder capitalism.

On the 50th anniversary of Davos has to act like an old man that thinks over his legacy at the age of fifty. Otherwise, it was right about Mr. Schwab to lament over the retreat from the ideals of the forum back in 1971. It is not to celebrate the anniversary but to think over the future critically. If the world is going through a new wave of nationalism and protectionism, there is no reason to stop them. Davos should discuss positively and healthily so that everyone can understand others. The forum is the place and should be the place for open thought and interaction.

Otherwise, it would be right in the words of New York Times’ article that “Davos has become a punch line”. It is time to present for self-accountability so that the world gets a common agenda to move forward. Congratulations to the forum and its founders as it turns 50, but it needs a critical look over its achievements and shortcomings.