The Swiss army conscripts guarding the VIPs have gone back to barracks, and the crowd control barriers and colorful bunting removed. That exciting week in late January when Davos becomes the world’s most exclusive club – the World Economic Forum (WEF) – is over. The powerful, the influential and the merely famous have all left.
The annual marathon over, and winter tourists rule Davos again. What happened – anything of note, or was it just a very expensive Groundhog Day? Did the WEF advance its lofty goal of “improving the state of the world?”
There was more introspection this year. Despite sighs of relief, the recovery is seen as tenuous. Some doubt is also emerging whether the WEF matters at all except as a massive networking event on the Magic Mountain, as the 20th century German author Thomas Mann called Davos.
Are there any lessons for us, the communications folk, in Davos 2013?
There is little surprise that there were warnings about the state of the world economy, even though bankers and other business people – and many government representatives – tried to focus attention on improvements in the economy. Christine Lagarde, managing director of the International Monetary Fund and one of the stars of Davos 2013, urged caution, describing the economic recovery as "fragile and timid". Commentators worried that we may see a decline in the pro-growth consensus. And in a world in need of both careful shepherding and new rules, clearly leadership itself is in crisis.
Gideon Rachman, the Financial Times columnist, wrote about “the Davos consensus” which he said has served the world well in the 30 years before the financial crisis. He warned that if China stops playing by Davos rules, the golden years of the WEF will be over.
“Since the financial crisis, (…) the ideas promoted at Davos have lost public confidence and support. This year, the fact that the world economy has stabilized a little led to a discernible rise in optimism among the people gathered in Davos. But the ‘reasonable’ worldview promoted at the forum is still far from secure. The most obvious question is whether it can still deliver prosperity. (…) But the real long-term threat to the Davos view may stem from economic hubris rather than despair. China still sends its English-speaking internationalists to Davos, but nobody is quite sure how much sway they hold at home. And if China stops playing by Davos rules, then the golden years of the World Economic Forum will be over. Despite the often justified cynicism that Davos provokes, the end of an era when the world’s most powerful people embraced similar ideas – and cooperated closely – would be a sad and dangerous moment.”
The Economist shone a light on leadership, and the crisis of trust.
There is clearly a need for global leadership, the magazine said, adding that the public is not impressed by what’s on offer.
“Many of the bankers and politicians caught dozing by the financial crisis were regulars at Davos. Ordinary folk trust Davos Man no more than they would a lobbyist for the Worldwide Federation of Weasels.”
Quoting the Edelman 2013 Trust Barometer, The Economist points out that only 18% of people trust business leaders to tell the truth. For political leaders, the figure is 13%. The magazine calls for stricter accountability for government leaders, and sounder regulations to curb corporate abuses. The Economist also says it would be wise for corporate leaders to become more local:
“The best global leaders need to immerse themselves in local cultures.” It calls for careful thought “about the relationship between business and the wider world. It sounds noble to promise, as practically every boss in Davos does, that your company will solve all manner of problems unrelated to its core business. (…) Talk of social responsibility needs to be realistic: it is more dangerous to promise too much than too little,” the magazine says.
For us communications professionals, Davos 2013 poses both challenges and opportunities.
First, uncertainty breeds a need for deeper, rich-context public relations. Understanding the societal dilemmas in which a corporation operates – so that it can mitigate its risks, operate with less friction, and spot and capture new openings – is a contribution that the CCO is uniquely placed to focus on.
Second, a fragile recovery is a chance to work on behaviors. Any economic trough brings a “back to basics” momentum. As we climb out of the trough, let’s not forget the basics, but codify and cement the good habits of leaner times to build better behaviors.
Third, storytelling remains the core of our job. As the global conditions for business change – how to stay both locally anchored and authentic is a balancing act which we need to address in the narrative about our company’s place in the world.
And finally, purpose is key. Knowing how to live your purpose so that CSR is not an add-on – as The Economist largely sees it – but your company’s way to create shared value is another opportunity for the CCO.
By Bjorn Edlund
Chairman Europe, Middle East and Africa, Edelman
Retd. EVP Communications, Royal Dutch Shell plc
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