50TH WORLD ECONOMIC FORUM ANNUAL MEETING

50TH WORLD ECONOMIC FORUM ANNUAL MEETING

March 26, 2020

The world that we’re currently living in is tumultuous. Economic downfalls, terrorism upsurges and even the mass outbreak of virus – there is no end to the number of challenges and obstacles that each of us global citizens needs to face daily. Regardless of our differences in terms of demography, all of us have one single identity – we are all citizens of the same planet. And that is what embeds us in the same thread and enables us to rise for each other’s national, local or even individual problems.

In the early 1970s, the global scenario did not offer us a rosy picture. The Cold War sliced the world in two, the Vietnam war had split America and to top it all off was an impending oil crisis. It was at that moment of uncertainty and global instability when a German Economics professor was struck by an epiphany. Professor Charles Schwab initiated the first meet under the name of the “European Management Forum”. It witnessed the participation of 450 individuals hailing from 31 different countries – managers from various companies in Europe, as well as members of the European Commission, and leading academics from U.S. universities – gathered in the Alpine valley to discuss better management techniques.

Initially, the meetings focused on how European firms could catch up with US management practices. This is where Professor Schwab introduced and promoted the ‘stakeholder’ management approach, which based corporate success on managers taking account of all interests: not merely shareholders, clients and customers, but employees and the communities within which they operate, including government. And in 1987, the forum decided to broaden its horizon and address issues that are much more crucial than the happenings of the corporate world. That was the birth of the World Economic Forum.

From then onwards, this annual meeting of the world’s leaders in the Swiss Alps witnessed its fair share of historic moments. In 2000, Gavi, the Vaccine Alliance was launched at the World Economic Forum Annual Meeting in Davos, with an initial pledge of $750 million from the Bill and Melinda Gates Foundation. To date, the Vaccine Alliance has contributed to the immunization of 760 million children, saving more than 13 million lives. Apart from inducing many other such key initiatives, the forum has witnessed the rise of a 16-year old environmental activist last year named Greta Thunberg; who solemnly iterated the impending global environmental crisis to all the world leaders.

Like every year, the 2020th Davos meeting also took place last month from 21st to 24th January. This year’s congregation had a specialty of its own. It was the 50th session of the World Economic Forum Annual Meeting and had invited not only the world leaders but also notable individuals from many other walks of life.

With the theme “Stakeholders for a Cohesive and Sustainable World”, the event witnessed discussions on a wide array of topics – (1) advocating for the environment and a response to climate change threats, (2) pursuing a more inclusive economy, (3) reaching global consensus on the deployment of Fourth Industrial Revolution technology, (4) how to reskill and upskill a billion people over the next decade, (5) building bridges to address global conflict, (6) helping businesses develop the models needed to drive business activity in the Fourth Industrial Revolution. The highlights of the topics have been outlined below –

 

FUTURE OF WORK

One of the significant launches of this year’s event was a platform named the Reskilling Revolution, an initiative to provide one billion people with better education, skills and jobs by 2030. Founding governments include Brazil, France, India, Pakistan, the Russian Federation, UAE, and the US. Several other organizations have pledged to support the cause, with the likes being PwC, Salesforce, ManpowerGroup, Infosys, LinkedIn, Coursera Inc. and The Adecco Group. The Forum has estimated that the platform will reach 250 million globally.

Coursera Inc. will be a data partner and a founding member of the Skills Consortium of online training and learning providers hosted by the Reskilling Revolution. Infosys is expanding computer science and maker education to K-12 students and teachers across the US, especially among under-represented communities, and will become a founding member of a Skills Consortium of online training and learning providers hosted by Reskilling Revolution. LinkedIn will be a data partner for the Reskilling Revolution initiative. ManpowerGroup’s MyPath is enabling hundreds of thousands of people to access high-growth roles by providing accelerated upskilling, on-the-job training and certification, transforming the role of the recruiter to become talent agents, experts in assessment, data and coaching so workers receive the guidance they need for future roles. PwC and its “New World. New Skills” program will deploy skills to support public-private collaborations through the Reskilling Revolution. It will also help clients prepare their workforces for the digital world, upskill each of its 276,000 people and scale up its community programs, particularly in areas where there is an acute need. Salesforce has committed to help train 1 million people with relevant skills and reach 10 million active users on Trailhead, Salesforce’s free online learning platform, within the next five years. Through workforce development initiatives including Trailhead Military, FutureForce and the Pathfinder Program, all powered by Trailhead, anyone can skill-up to learn in-demand skills and earn credentials to land a top job in tech.

The World Economic Forum also released a report during the annual meeting entitled, Jobs of Tomorrow: Mapping Opportunity in the New Economy. The report, which was produced with the help of LinkedIn, Coursera and Burning Glass Technologies, maps seven emerging professional clusters and the 96 fastest-growing jobs within them.

 

SUSTAINABILITY

During the annual meeting, the chief executive officers of many of the world’s largest companies expressed support for aligning on a core set of metrics and disclosures in their annual reports on the non-financial aspects of business performance such as greenhouse gas emissions and strategies, diversity, employee health, and well-being and other factors that are generally framed as Environmental, Social and Government (ESG) topics.

Though business leaders increasingly see the topics of ESG and the United Nation’s Sustainable Development Goals as important to long-term business value creation, lack of comparable ESG reporting in mainstream reports hinders the meaningful benchmarking of sustainable business performance by investors and society, says the Forum. The Forum’s International Business Council discussed a proposal prepared by the Forum in collaboration with the Big Four accounting firms — Deloitte, EY, KPMG, and PwC — titled Toward Common Metrics and Consistent Reporting of Sustainable Value Creation. The proposal recommends a set of core metrics and recommended disclosures. The intent is for the metrics to be reflected in the mainstream annual reports of companies consistently across industry sectors and countries.

The proposed metrics and recommended disclosures have been organized into four pillars that are aligned with the SDGs and principal ESG domains. They are:

Principles of Governance. The “principles of governance” focuses on a company’s commitment to ethics and societal benefit, in alignment with SDGs 12, 16 and 17.

Planet. The “planet” looks at the themes of climate sustainability and environmental responsibility, in alignment with SDGs 6, 7, 12, 13, 14 and 15.

People. The “people” aspect of the domain examines the roles human and social capital play in business; per SDGs 1, 3, 4, 5 and 10.

Prosperity. Aligned with SDGs 1, 8, 9 and 10, “prosperity” focuses on business contributions to equitable, innovative growth.

 

BLOCKCHAIN

The World Economic Forum also announced what it says is “the first neutral and public traceability platform” capable of visualizing blockchain-based supply chain data from multiple companies and sources. It aims to help businesses across industries respond to consumer demands for ethical and environmentally friendly products. To date, companies have self-published such data or relied on blockchain solution providers to do so. The pilot platform resulting from this initiative, however, can ingest blockchain-based data from multiple sources and visualize it on a neutral site.

It was created in collaboration with a dedicated group of champions comprised of Everledger, Lenzing Group, TextileGenesis™ and the International Trade Center. The International Trade Center, a UN entity with universal membership by mandate, has hosted it via its Sustainability Map (https://sustainabilitymap.org). In this way, the ITC says it can assure all parties that their data will not be shared externally and that sensitive data can be hosted at UN data centers to benefit from UN neutrality, immunities and privileges.

It was made clear during the annual meeting that those companies that claim to be supporting a reduction of emissions will be called out if their actions do not correspond to their pledges. Since the groundbreaking Paris summit on climate change in 2015, 24 global banks have invested $1.4 trillion in the fossil fuel industry even if they claim to be supporting net-zero initiatives, according to Jennifer Morgan, Executive Director of Greenpeace International. Greenpeace’s report, It’s the Finance Sector, Stupid, published during the annual meeting, blames the climate emergency at the feet of the banks, insurers and pension funds that participate in Davos. The report adds that $1 trillion could buy 640GW of solar power, more than the current global capacity.

Rahmyn Kress, the founder of HenkelX, an open innovation platform that is designed to help industrial players become more innovative and adopt disruptive business models, urged leaders to heed the Forum’s call to action during a speech at an event in Davos organized by Futur/io. “The business leaders, heads of state, industrialists and corporate community must realize the urgency to tackle the SDGs through innovation and sustainable investments and focus on building industry standards for new technologies to emerge on a solid backbone,” said Kress. “Only if we start working together will we achieve success leading to a more desirable future for the generations to come.”

Kress urged leaders in Europe and elsewhere to “start investing in the future, entrepreneurship, and innovation. Be part of building new talent for the future and a stronger economy, act with stewardship and as a role model on topics such as diversity.”

 

ENERGY TRANSITION

At the annual meeting, 42 organizations, including businesses from mining, chemicals, battery, automotive and energy industries, representing annual revenue of close to a trillion dollars, along with international organizations and global NGOs, agreed on 10 guiding principles for the creation of a sustainable battery chain by 2030. They include maximizing the productivity of batteries, enabling a productive and safe second life use, circular recovery of battery materials, ensuring transparency of greenhouse gas emissions and their progressive reduction, prioritizing energy efficiency measures and increasing the use of renewable energy, fostering battery-enabled renewable energy integration, high-quality job creation, and skills development, eliminating child and forced labor, protecting public health and the environment and supporting responsible trade and anti-corruption practices, local value creation, and economic diversification.

 

CORPORATE-STARTUP COLLABORATION

A number of the Forum’s Technology Pioneers invited to this year’s meeting leveraged the opportunity to discuss ways of reducing pollution with established industries. Among them was Photanol, a Dutch scale-up which is developing a way to turn carbon dioxide into chemicals with sunlight. The aim is to provide a sustainable alternative for petroleum-based and sugar-derived products while reducing the amount of CO2 in the atmosphere. The company is in talks with potential clients about using its technology to replace lactic acids in creams and shampoos, to make biodegradable yogurt containers and to produce bio-based detergents. Eventually the same technology could be used to make biofuels. Another of the 2019 pioneers, Israeli startup TIPA, has developed fully compostable flexible packaging that can do the same job as polyethylene and polypropylene, the most common forms of conventional plastic, without polluting the environment. Its patent-protected film can be produced using the same machinery as conventional plastic packaging, enabling traditional manufacturers to go green.

 

CYBERSECURITY

The Forum issued a call to action, calling on companies to work together to find a way to safely transition away from passwords. Cyber-attacks are set to cost the global economy $2.9 million every minute in 2020 and some 80% of these attacks are password-related. Knowledge-based authentication — whether with PINs, passwords, passphrases, or whatever we need to remember — is not only a major headache for users, but also costly to maintain. For larger businesses, it is estimated that nearly 50% of IT help desk costs are allocated to password resets, with average annual spending for companies now at over $1 million for staffing alone. “Better authentication practices are not just possible they are a necessity,” said Adrien Ogee, Project Lead, Platform for Shaping the Future of Cybersecurity and Digital Trust, World Economic Forum.

The Forum issued a report, produced in collaboration with the FIDO Alliance, that introduces five top password-less authentication technologies, ready for implementation by global companies. They are biometrics, behavioral analytics, zero-knowledge proofs, QR codes and security keys. However, the Forum says, there is a need to build the right data governance model and framework at a senior leadership level, to ensure that solutions adopted to protect data privacy. The World Economic Forum Centre for Cybersecurity also brought together a group of leading ISPs and multilateral organizations to develop new ways to protect and prevent cyber-attacks from reaching the largest number of Internet users. Following a year of development and testing, four actionable principles were identified as successful in preventing malicious activities from getting “down the pipes” to consumers, set out in a new report: Cybercrime Prevention: Principles for Internet Service Providers. BT, Deutsche Telekom, Du Telecom, Europol, Global Cyber Alliance, Internet Society, Korea Telecom, Proximus, Saudi Telcom, Singtel, Telstra, ITU endorsed these principles, helping to protect up to 1 billion consumers in 180 countries, according to the Forum.

 

QUANTUM COMPUTING

Quantum computing was a big topic this year. No company wants to fall behind when a technology shift transforms an industry. Yet, there are enough unknowns about quantum computing and enough fundamental scientific riddles to solve that no one can say for certain when it might be ready to make an impact.

So how will quantum compute change business? Which sectors will be impacted first? What should every executive know about the technology and what should they be doing to prepare? Participants in a panel on the potential of quantum computing at the Forum’s annual meeting 4 moderated by The Innovator’s Editor-in-Chief Jennifer L. Schenker, tried to put these issues into the limelight.

Panelist Scott Aaronson, a theoretical computer scientist, and David J. Bruton Jr. Centennial Professor of Computer Science at the University of Texas at Austin has stated that “The first impact of quantum computing capabilities is likely to be felt in the businesses that are dependent on simulation of quantum mechanical processes, such as materials, chemicals, and scientific research”. That alone will likely have a monumental impact on society. “Think of it as the ability to turn on a new telescope into nature,” he says.

 

CENTRAL BANK AND DIGITAL CURRENCIES

As the World Economic Forum’s annual meeting in Davos was coming to an end, the Forum announced that it is forming a Global Consortium for Digital Currency Governance. The initiative brings together leading companies, financial institutions, government representatives, technical experts, academics, international organizations, NGOs and members of the Forum’s communities on a global level. Earlier in the week the Forum announced the Forum and a community of over 40 central banks, international organizations, academic researchers and financial institutions have created a policy-maker toolkit to help central banks evaluate, design and potentially deploy central bank digital currencies (CBDCs). The Forum is convening a global community of central banks from both emerging and developed economies to exchange best practices and learn about how CBDCs work. CBDCs are digitalized instruments issued by the central bank for payments.

With the launch of interactive platforms and initiatives aimed at harnessing wellness in multiple avenues, we can easily assume that this year’s event is the bedrock of tomorrow. A tomorrow which will an equal world, a sustainable world and a world where everyone can reach their fullest potential.

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