Davos 2008: ends and beginnings, John Elkington

Thu, 31 Jan 2008 17:55:28 +0000

A thin splatter of what looked like blood streaked the snow as I tramped towards the security-checks for the World Economic Forum's annual meeting. Because I was trying to retrieve my badge to show the police, I didn't pay it much attention, aside from a slight tweak of sympathy for what I assumed to have been some poor mammal disappearing into the skies in a predator's talons.

A few days later I had a shock of recognition, when the backside of the Davos congress centre was ritually splattered with red pigment - the protestors' way of denoting the forum participants' complicity in a livid spectrum of the world's ills. And the scarlet arcs set off a train of thought that I'm pretty sure those on "the other side of the fence" did not intend.

John Elkington is founder and chief entrepreneur at SustainAbility and blogs here

Also by John Elkington in openDemocracy:

"Why I'm going to Davos"(16 January 2003)

"Biotechnology: the case for sustainability"(20 August 2003)

"It's the system, stupid!"(5 February 2004)

"Globalisation's reality check" (7 September 2004)

"After Stern: let's get technical"(2 November 2006)

"Climate change's right and wrong fixes" (2 February 2007) - with Geoff Lye

"Brundtland and sustainability: history's balance-sheet" (12 April 2007)

"India's third liberation" (21 August 2007)

"Anita Roddick: outsider rules" (24 September 2007)

This was the seventh consecutive year I had been to the forum's annual meeting; the first was in 2002 in New York, in the wake of the 9/11 attacks. But in a still half-formed sense, 2008 already feels like the end of a great cycle that began even earlier, at the World Trade Organisation summit in Seattle in November-December 1999. At the time, the anti-globalisation protestors were on a roll, as the "battle of Seattle" (and the demonstrations at Genoa and elsewhere that followed) scared, provoked, and sobered the powers-that-were - at least for a while. The achievement of the "anti-globalisation" agenda was to fuse an unlikely alliance of demonstrators and causes - environmentalists, trade unionists, anti-corporate protestors, political activists, single-issue campaigners, and radical business people (such as the much-missed Anita Roddick) as well as headline-hogging out-and-out anarchists. But the new Davos combination - the incorporation of issues that were once "alternative" into the "mainstream" summit agenda, and the routinisation and stage-management of (diminishing) protests - suggests a need to take stock of where we are and of where we need to go next.

The economy, hélas

The early drama of the World Social Forum (WSF's) challenge has faded. Indeed, if there is one lesson we could all learn from recent years it is that - unless you are Bill Clinton - it is virtually impossible to "beat" the WEF if you try to play it at its own game. But there is still something in the original WSF thinking around inclusiveness (and open-source approaches to problem-solving) that is worth recalling and building upon.

As it happens, the "power of collaborative innovation" was the theme of the WEF's 2008 annual meeting; but from the moment we stepped down from the train into still-fresh snow it was clear that, once again, the best-laid plans had been overtaken by events. True, the summit would eventually wind up with a call by the assembled leaders for "a new brand of collaborative and innovative leadership to address the challenges of globalisation, particularly the pressing problems of conflict, terrorism, climate change and water conservation"; but the economy (in a way reinforced by the arrival of news of the Société Générale "rogue trader" scandal) was the hot topic.

This was the first year I had been invited to attend the Wall Street Journal private dinner where Journal editors convene a small group to distil the essence of the Davos gathering. It hopefully breaches no confidence to report that the WSJ team itself felt that what had emerged was the most diverse, Hydra-headed agenda on record. The snaking heads of the beast that now stalks the "magic mountain" - in addition to those outlined in the WEF's concluding statement - are the growing risks to the global economy, including protectionism as well as recession.

Davos 2008's concern with the economy was not a great surprise in current conditions. Indeed, the Société Générale affair - however far the accountability reaches - seems only to confirm my long-held view that we "should" have had a recession around 2005-06, and that the continuing boom conditions (which this year's Davos had been intended to celebrate) allowed a bunch of financial idiocies to proliferate. But an ecological metaphor suggests there may be compensations: just as the long-term health of some ecosystems depends on fires or other cycles of natural destruction, so the global economy needs - perhaps especially in times of profound change - bouts of "creative destruction".

A key task of such periods, however, is to minimise avoidable and irreparable damage. The combination of an economic downturn with intense environmental pressures mean that resource constraints are becoming a painful reality in ways that environmentalists and anti-globalisers have long predicted. In this respect it was energetically argued at Davos by groups like Circle of Blue that issues such as water supply and water quality are set to become increasingly urgent; and it was good to hear CEOs like E Neville Isdell of Coca-Cola and Peter Brabeck-Letmathe of Nestlé embracing the challenge - not least because their companies are under intensifying pressure to assist developing countries (India, for example) in managing their water and other natural resources more equitably and sustainably.

Such corporate awakenings are welcome; but a longer-term view suggests that promises and pledges from the platforms at places like the WEF and the Clinton Global Initiative cannot be taken at face value. There is a need to back words with a qualitative step-change in action.

The art of solutions

A rapidly increasing global population presents intense challenges to the world's health, education, and energy systems. The most basic needs - the ensuring universal access to medicines, clean water and affordable energy - will become much more difficult to meet. Big companies have critical roles to play in addressing such challenges, but they won't succeed simply by drawing "straight-line trajectories" from their current corporate-citizenship activities. Instead, there is a need to draw on a very much wider pool of entrepreneurial talent. This is an idea Pamela Hartigan (of the Schwab Foundation for Social Entrepreneurship) and I develop in our new book, The Power of Unreasonable People: How Social Entrepreneurs Create Markets That Change the World (Harvard Business School Press, 2008).

The book went into the packs of Davos participants this year, in an initiative funded by the Skoll Foundation for Social Entrepreneurship. This was a crucial opportunity to spread awareness of the work of leading social and environmental entrepreneurs among Davos's business leaders. The coverage in serious publications - including the Economist and the International Herald Tribune - suggests a rising understanding that organisational leaders such as Robert Massie (who played a crucial role in the evolution of the Global Reporting Initiative) and Peter Eigen (who did likewise with Transparency International) are co-evolving the rules of tomorrow's economy. They are indeed, entrepreneurs as much as is (for example) Bill Gates. This is a vital breakthrough.

Indeed, the brilliance of leading social and environmental entrepreneurs at many Davos sessions is a hopeful sign amid the worry over the wider global economy. As WEF founder and executive chairman Klaus Schwab explains in the foreword to The Power of Unreasonable People: "Today, we have fully integrated social entrepreneurs into the Forum program; corporate leaders court them for their ideas, insights and innovations, and the international media eagerly follow their stories." But, he cautions, while these people could bring phenomenal power to bear on many of the world's greatest problems, "the challenge is now to harness it to drive the necessary scale of change." With the forum's collective mind focused elsewhere this year, this remains unfinished business.

Although I believe that corporate social responsibility initiatives will be squeezed intensely in 2008-09, multinational companies that want to retain and build their brands and reputations worldwide would be ill-advised to make their citizenship activities a priority for cutbacks. The individuals and organisations that drove the last round of adaptation at the WEF and elsewhere haven't gone away - on the contrary, they're morphing at a rapid pace. When under threat, the "system" always tries to co-opt leading elements of the opposition, but this approach very often spurs the evolution of new challengers. Instead, as this year's Davos underscored, corporate and financial leaders now need to ensure that they understand the really strategic priorities for their businesses in these areas as they move into new markets - and they also need to ensure that people in core positions can manage to scale up projects and lead new ventures to achieve higher levels of effectiveness.

At the same time, there will always be a limit to the extent to which incumbents can detect emerging societal and market trends, and adapt ahead of them. In that light, if I had to pick just one person out of the Davos fray this year as a symbol of the emerging order, it would be J Craig Venter, whose amazing book A Life Decoded I had been reading on the way to Davos. This work will trigger intense concerns, but my sense is that eventually the synthetic-biology technologies Venter is developing could - in enabling new approaches to issues such as global warming - lead to a convergence of the interests of those on both sides of the Davos fence.

I am not a great believer in technical fixes for problems that demand political - and moral - responses, but the new century's challenges demand new tools. It may be time to put the pigment away, and get to work.

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Davos 2008: ends and beginnings, John Elkington