No navel-gazing here

News And Views

News & Views

  • 20 January 2023
  • Simon Tiernan

3MZ Thinks: Plenty of moguls to navigate at Davos

What’s happening in Switzerland this week?

The Swiss alpine town of Davos is playing host to the 53rd annual meeting of the World Economic Forum (WEF).

The forum brings together some of the biggest hitters from the world of business, politics, and the media, ranging from the President of the EU Commission, Ursula von der Leyen to Amazon CEO, Andy Jassy and environmental activist Greta Thunberg.

This year it has been notable that several world leaders have been absent from the summit including UK Prime Minister Rishi Sunak and major figures from the Biden Administration in the US.

That doesn’t mean that the gathering isn’t important - there are over 2,700 delegates drinking hot chocolate in the mountains, representing over 130 countries, likely making Davos the largest gathering of global decision makers in 2023.

What’s been discussed?

No country has been immune to the global economic headwinds swirling, which is why this year’s chosen theme has been ‘Cooperation in a Fragmented World’. The call from global world leaders has been for an exit to the continued “polycrisis”, that has been man-made, drawn-out and detrimental to economies and societies globally. The call to action being for countries to adopt a more globalist approach and facilitate greater collaboration between companies and countries to help steady the economic uncertainty.

Tackling the climate crisis has been a more muted discussion point at Davos this year, with immediate attention drawn towards the challenging economic environment – inflation, rising fuel costs, and food shortages triggered by the Ukraine War. Davos 2023 has failed to replicate the impact of its 2020 edition in which Prince Charles took to the stage to call for a global economic revolution to prevent an early climate doomsday.

Out of touch?

The forum has a growing image problem and the annual criticism levied against Davos attendees being out of touch carried extra bite this year. As global economies brace for recession, the usual crop of old, white, rich men, have flown in and out on private jets to engage in conversations on sustainability and equality.

Speaking of being out of touch, WEF founder and executive chair Klaus Schwab is facing a mutiny amongst his own staff as the 85-year-old clings on to a role only he has ever held. Any succession talk has been suppressed and his critics predict he will only relinquish power when he dies, like the kings and popes he is said to style himself after.

Key takeaways

  • Prime Minister Sir Kier? You would certainly think so if reading the front page of Thursday’s Financial Times which led with “Starmer heads to Davos on a mission to repair ties with EU and global finance”. You couldn’t buy a headline like that.
  • Action on inflation: President of the European Central Bank Christine Largade outlined reducing inflation as the ‘prime mission’ of the European Central Bank, a plan supported by UK Chancellor Jeremy Hunt who reiterated the UK Government’s desire to drive inflation down.

  • Big Oil is the new Big Tobacco: UN leader António Guterres’s Forum speech went studs-up on fossil fuel firms, rejecting their business models as “inconsistent with human survival”. He likened Big Oil’s continued climate change denial to the tobacco industry’s dismissal of science throughout the 20th century. That image may prove hard to shrug.

  • Biden’s green plan wins suitors: European executives have challenged Brussels to respond to the US’s multi-billion-dollar clean energy subsidy plan or risk falling behind in the green energy revolution. Nicolas Schmit, the EU’s Commissioner for Jobs and Social Rights, has been promoting the EU’s own €20bn Euro transition fund for the future of green jobs, but business attention remains fixed on Biden’s ‘huge’ green package.

What’s next?

World leaders will this weekend ski off into the Davos sunset, leaving behind a world that continues to be beset with challenges, but importantly positive opportunities.

The summit can rightly be labelled as out of touch, but what it often does is set the big geo-political theme for the upcoming year – as such expect sensibility, collaboration, partnerships and a reduction in harmful actions and rhetoric being the areas that resonate domestically in the UK and across the globe this year.