What is the World Economic Forum in Davos?

Last week, the world’s top business, economic and political leaders met in the ski resort town of Davos, Switzerland for the World Economic Forum.

It’s an exclusive club – some have to pay, others are invited. But it’s event where the world’s most influential people meet every year for a ski and a chat about money and ideas.

Aside from its flagship meeting simply referred to as ‘Davos’, the World Economic Forum (WEF) hosts other key meetings and summits around the world and publishes reports for its well-heeled members.

The World Economic Forum (WEF) is a foundation set up by Swiss business professor Klaus Schwab.

In 1971, he invited 444 European chief executives to Davos to discuss US business strategies, in what was initially called the European Management Forum.

After ‘71, the event gradually widened its agenda to economic and social issues and attracted more prominent participants. It became the WEF in 1987 and broadened its focus further to include resolving international conflicts.

The Forum’s mission is now ‘committed to improving the state of the world.’

Davos

Mission statements aside, the meeting is Davos is arguably the world’s ultimate networking session, with over 2,500 of the world’s top movers and shakers in attendance.

It takes place every year at the end of January for a week, and has roughly 220 specific sessions and workshops for all types of industries and world issues.

Almost every large business and industry leader in the world is represented, and it is an opportunity for the CEOs to learn about and discuss issues affecting their industry.

From a world perspective, the purpose is to discuss ideas and possible solutions with a wide range of political, social and economic experts.

About 500 journalists cover the event in detail as it is usually a measure of where the world is at.

For instance, in last week’s meeting, the broad consensus was that the worst of the recession is over, and now it’s time to repair the damage and discuss new rules of how to avoid a repeat performance in the banking system.

At the same time, leaders such as Helen Clark (head of the UN Development Programme) and Bill Clinton (head of the Clinton Global Initiative) were there to discuss how to rebuild Haiti in a way that is both profitable and socially beneficial.

Above all though, it’s one giant meeting for the world’s elite to strengthen relationships with each other and discuss ideas in person.

The World Economic Forum

Davos, however, is just the high-profile side of the foundation. The WEF itself is a Geneva-based think tank, with offices in New York, Beijing and Tokyo.

The Forum produces a variety of reports for its members on information ranging from sustainable food production and climate change, to African competitiveness and global risk. This information can be just as valuable as the meet-and-greet sessions.

WEF also organises other events around the world such as the World Economic Forum on Latin America, and the Summit on the Global Agenda for 2010.

Like anything of value though, it must be paid for. The WEF is funded by a highly-expensive fee scheme.

Its 1,000 members pay an annual fee of 42,000 Swiss francs (about the same value as the US dollar), plus an CHF18,000 fee for the annual meeting in Davos.

On top of this, strategic partners and industry partners (companies that play a leading role in the Forum) pay CHF500,000 and CHF250,000 respectively.

And not just any company can join. Typical member companies are global in nature and have over US$5 billion in annual revenue (exceptions are made for those in developing countries). Each must be a leader in its industry or country.

CEOs from these companies get an automatic invitation to Davos and other relevant events. Politicians, intellectuals and social leaders don’t have to pay, but must be invited based on their influence over the issues being addressed.

The WEF is not without criticism though. The events are usually complemented by a vocal band of protestors who see efforts at tackling the world’s problems as merely an exercise in controlling wealth.

WEF’s members and partners are all the top companies in the world whose sole focus in on profit, so the cynicism is understandable and probably justified to an extent.

However, like what Davos regular Bill Gates calls ‘creative capitalism’, the Forum strives to find the successful mix between all stakeholders in business – from shareholders seeking profit to societies seeking progress. Haiti’s reconstruction is a good example.

So every January, the world’s great minds meet in Davos to discuss world issues and business. Yes it’s filled with self-interest, but it’s also designed to get such people thinking about how to improve the state of the world – and that can only be a good thing.

By The Casual Truth

Photo – Davos, Switzerland