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Davos Has a Credibility Problem

24/01 17:45 - Davos Has a Credibility Problem
Davos Has a Credibility ProblemDAVOS, Switzerland — Salvador Gómez-Colón, a teenage environmental and humanitarian activist from Puerto Rico, started the day Tuesday by telling business and government leaders that they didn’t have much credibility.“We’re tired of too much coming to Davos and going back and not doing anything,” Mr. Gómez-Colón said. “We’re tired of empty promises, we’re tired of too much talk.”Mr. Gómez-Colón’s remarks echo those of critics of Davos throughout history, including the anti-globalization protesters who took to the streets in a violent demonstration in 2000, decrying the gathering as a “meeting of murderers.”But on the 50th anniversary of the World Economic Forum in Davos, the annual gathering of about 3,000 business, government, and nonprofit leaders to discuss global issues in an Alps ski resort town, the critique carries extra heft.New survey data from the public relations company Edelman indicates that 56 percent of people globally believe capitalism does more harm than good. Nearly 50 percent of those surveyed said “the system is failing me.” Just 31 percent of respondents said they believed businesses would “pay everyone a decent wage,” though 82 percent said that was the duty of businesses. Trust in government is even lower than in business. “It’s a paradox of trust,” said Richard Edelman, the firm’s chief executive. “Economic circumstances are quite good and trust is down, and fears are very high.” The World Economic Forum’s own research released this weekblamed entrenched inequality across the globe for “a growing sense of unfairness, precarity, perceived loss of identity and dignity, weakening social fabric, eroding trust in institutions, disenchantment with political processes and an erosion of the social contract.”“We cannot deny that there is a general loss of trust and confidence of people,” acknowledged Klaus Schwab, the forum’s founder and executive chairman.Against that backdrop, it’s easy to understand skepticism about this gathering that includes more than 100 billionaires, many of whom arrived by private airplane. Despite efforts by the forum to entice and cajole organizations to bring more women, just 24 percent of attendees are female. Business leaders aren’t running toward discussion of pointed topics related to corporate responsibility, like tax avoidance. The author Anand Giridharadas has called Davos a “carnival for those who have rigged so many countries around the world,” and recommended that it be canceled.Mr. Schwab has framed this meeting around the theme of stakeholder capitalism, a shorthand for business concern for factors like workers and communities and not just their shareholders. To his credit, his response to the trust problem is to try to focus the proceedings on specific efforts around the environment and corporate responsibility. “The annual meeting will be a ‘do show,’ not a talk show,” he vowed on the main stage on Tuesday morning. Among the initiatives showcased here this week are a “trillion tree” project aimed at boosting reforestation and an effort to better audit companies’ social and environmental practices. The forum has a list of some concrete actions that resulted from its 2019 meeting.Editors’ PicksThe New Generation of Self-Created UtopiasThe Sex Scene Evolves for the #MeToo EraWhy ‘Star Wars’ Keeps Bombing in ChinaContinue reading the main storyBut the Davos business community’s increasing acceptance ofPresident Trump, who doesn’t believe in climate change and withdrew the United States from efforts to fight it, doesn’t help. Mr. Schwab diminished the forum’s credibility when he stood shoulder-to-shoulder with Mr. Trump on Tuesday and declared, “All your politics, certainly, are aiming to create better inclusiveness for the American people.”Already there are concerns that new lower estimates for global growth by the I.M.F. could undermine some corporate commitment to climate-change initiatives. “The latest signs of economic fragility will force global leaders and chief executives to tackle the more immediate challenges of restoring growth and confidence, rather than focusing on how to address climate change,” concluded The Financial Times.Does it matter if skepticism of the business and political elite and capitalism is mounting again? And does it matter if Davos is perceived to be just an expense-account-fueled frenzy of business deal-making and platitudes? Did most people — the constituents of the people here, workers and voters and their children — really think it was anything other than that?At the very least, it deepens critics’ convictions that business and government leaders can’t be trusted to deal with the world’s most pressing problems.“You say: ‘Just leave this to us. We will fix this, we promise we won’t let you down,’” the teenage climate activist Greta Thunbergtold attendees. “And then, nothing. Silence. Or something worse than silence. Empty words and promises which give the impression that sufficient action is being taken.”For companies to convince people around the world, especially the young, that capitalism is viable, business leaders need to show that they’re making hard decisions. The elite gathered here may think that they are making changes, but others don’t think they are doing enough when it comes to the environment and social responsibility. It’s a matter of degree, and speed.“Unless this crowd is willing to give up some power and share it, it’s not going to get better,” said Christy Hoffman, general secretary of the UNI Global Union, a global federation of trade unions.Maybe there’s hope. At mealtime discussions around the town, that sort of behavior — making the right decision even when it’s not good for you personally — is being praised more generally as a sign of strong leadership.“The question we should ask ourselves every year is ‘What decisions have I made this year that have sacrificed my own personal advantage and gain for the gain of the institution?’” said Ngaire Woods, the founding dean of the Blavatnik School of Government at Oxford University. “If you’ve come up with zero, you’re probably off base.”In its embrace of both Mr. Trump and Ms. Thunberg, the Davos set seems to want it all: lower taxes and a climate-friendly agenda. But that dance is increasingly straining the patience, and trust, of the rest of the world.Kevin J. Delaney (@delaney) is a senior editor in the Opinion section. https://www.nytimes.com/2020/01/21/opinion/davos-credibility.html...


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