Researched by: Sara Varghese & Prafula Grace Busi

Remind me, what is Davos…

Origin story: Forty five years ago, economist Klaus Schwab, organised something called the European Management Symposium—bringing together 450 European leaders. The conference took place in Davos—a place that was until then best known as a skiing destination. The location was inspired by Thomas Mann’s novel ‘The Magic Mountain’—in which a young man goes to a sanatorium in Davos—and has a life-changing experience. As one Time magazine review of the book put it: 

“In the sanatorium, a high and chilly retreat, the perspective of life changes… With death for a background, massive and eccentric as the high Alps, the caperings of man seem puny by comparison. The idiotic decadence, the absurdly microscopic preoccupations of humanity are emphasized by their isolation.”

Schwab hoped the mountain air would have a similar effect on his conference attendees—minus the spectre of death, of course. 

The evolution: Rechristened as the World Economic Forum in 1987, the invitation-only, four-day conference soon became a global event—attracting the most powerful people in the world each year. The guest list in the past has included heads of state, corporate titans, celebrities, even activists like Greta Thunberg. 

The purpose: The WEF’s official aim is to “engage the foremost political, business, cultural and other leaders of society to shape global, regional and industry agendas.” It’s basically a gargantuan networking event—with an A-plus list of attendees. While there are plenty of panels and speeches, the real action takes place behind closed doors—which is where corporate leaders and politicians cut big deals. Examples: North and South Korea held their first ever ministerial-level meeting at Davos in 1989—while Greece and Macedonia settled their conflict over Macedonia’s name in 2018.

Point to note: Speakers get paid generous fees plus expenses. While companies have to pay a hefty fee ($28,000 per head) for the privilege of attending, everyone else gets a free invite—though not every invite is the same. There are different coloured badges for participants—offering varying levels of access. The highest is white which lets you into hush-hush backroom meetings with the high and mighty. Companies can purchase that privilege for $50,000 a pop.

Davos 2022: The forum kicked off on May 22—after being put on hold for two years. And it’s been pushed to the summer—which means there will be relentless rain instead of skiing this year. There are also fewer attendees this year—but there are plenty of big names including President Zelenskyy, Bill Gates, Microsoft CEO Satya Nadella—and cellist Yo-Yo Ma. 

The 109 Indian delegates include Mukesh Ambani and Gautam Adani—along with Serum Institute’s Adar Poonawalla. Of course, our netas are in full attendance as well: Three ministers including Piyush Goyal and the two CMs Basavaraj Bommai and Jaganmohan Reddy.

Not on the guest list: Anyone from Russia.

Ok, so why does this schmooze-fest matter?

Presumably, it is always important when extremely powerful people get together to cut deals—which will impact the rest of the aam janta. But whether Davos is a force for good or bad remains a subject of heated debate.

Meet the Davos Man: Political scientist Samuel P Huntington coined the phrase in a paper about “an emerging global superclass” of “gold-collar workers”—who couldn’t care less for their own people:

“{t]hese transnationalists have little need for national loyalty, view national boundaries as obstacles that thankfully are vanishing, and see national governments as residues from the past whose only useful function is to facilitate the elite's global operations.”

The Davos Man proudly flaunts this “global” mindset as a badge of his deep concern for the greater humanity and good. As author Peter Goodman scathingly puts it:

“Schwab has constructed a refuge for the outlandishly wealthy, an exclusive zone where they are free to pursue deals and sundry shenanigans while enjoying the cover of participating in a virtuous undertaking. Their mere presence in Davos at the Forum signals their empathy and sensitivity.

 

In the prevailing pantomime, Davos Man is intent on channeling his intellect and compassion toward solving the great crises of the age… So he is in Davos—paying fees reaching several hundred thousands of dollars a year for a Forum membership, plus tens of thousands more per head to attend the meeting—posing for photos with Bono, congratulating Bill Gates on his philanthropic exploits, tweeting out inspirational quotes from Deepak Chopra, and still finding time to buttonhole that sovereign wealth chieftain from Abu Dhabi in pursuit of investment for his luxury-goods mall in Singapore.”

Yeah, well, that pretty much sums up the main critique of Davos and its attendees. 

Also this: Critics claim that the virtuous public panels are just a PR figleaf for under-the-radar networking among the VVVIPs: “Regular participants at the Forum boast about having attended zero panels and never setting foot inside the main assembly hall—a cynical mark of sophistication—while celebrating their invites to notorious soirees full of privileged debauchery.”

And this: Simon Kuper in the Financial Times points out that despite their immense power and wealth, Davos’ big shots are often the most blinkered in their view of the future. In 2008, economist Fred Bergsten infamously declared: “It is inconceivable—repeat, inconceivable—to get a world recession.” Its Global Risks report did not foresee Brexit or the election victory of Donald Trump. As one expert puts it: “No matter how improbable, the event most likely to happen is the opposite of whatever the Davos consensus is.”

As for the Davos Woman: Unsurprisingly, the average attendee is white, male and very wealthy. Women only accounted for 24% of the guest list in 2020.

Data point to note: Each year, Oxfam International pointedly releases its annual report on the eve of Davos. The highlight of the 2022 edition is a single ugly fact: During the pandemic, a new billionaire was created every 30 hours—while a million people are at risk of falling into extreme poverty this year at the same rate. Also this: “A worker in the bottom 50% would have to work for 112 years to earn what a person in the top 1% gets in a single year.”

Surely, it’s not all bad…

Sure, Davos has its shares of defenders too. Many argue that it is “the rare forum whose critical mass of intellectual decision makers offers unrivalled opportunities to create change and actually get things done.” Good outcomes include: 

• The New Development Bank, which was envisioned at Davos by the BRICS nations—Brazil, Russia, India, China and South Africa—to better leverage their economic clout.
• Another is Gavi, the Vaccine Alliance, which was launched at the forum in 2000. It claims to have “protected more than 900 million children, preventing over 15 million future deaths.” 
• And in 2020, it also put together the Covax initiative to ensure equitable access to Covid vaccines.
• This year, a group that calls itself Patriotic Millionaires issued a letter signed by over 100 global millionaires and billionaires to demand the super rich pay more taxes.

Also this: Davos is changing its privileged white male ways. The 100women@Davos brings together female CEOs, leaders and “changemakers” who leverage their connections to give women more visibility and power. A recent analysis found that words that indicate concern over climate change—‘pollution,’ ‘nature’ etc—have grown four-fold in its press releases. And terms like ‘diversity,’ ‘ethnicity,’ and ‘equality’ have increased five-fold in the past six years.

The main defence: The sheer concentration of the powerful within a small space for a short period of time is Davos’ greatest asset. It can spark radical and speedy changes—which would otherwise take years: 

“No global gathering can compete with Davos for the sheer concentration of influential, exceptionally connected power brokers with the ability to turn ‘eureka’ moments into tangible, actionable, long-term policies that truly affect everyday life.”

So what can we expect this year?

A massive existential crisis, for the most part. 

Economist Thomas Friedman—the ultimate Davos Man—famously proposed the ‘Golden Arches’ theory of conflict prevention: “no two countries that both had McDonald’s had fought a war against each other since each got its McDonald’s.” Well, McD just shut its last shop in Russia.

A divided world: The invasion of Ukraine has divided the world—and sent China into retreat. Davos’ ‘globalisation solves all’ credo has been shattered. And the pandemic proved that borders do, in fact, matter. As even WEF founder Klaus Schwab concedes: “We are living in a different world.” It’s telling that he doesn’t even understand President Putin’s decision to invade: “It’s not at all rationally explicable, or explainable to me.” And an unusually gloomy Schwab warns:

“We risk that the world splits up into a multi-power system. We have different philosophies, ideologies; even inside countries we have a polarization which you haven’t experienced 10, 15 years ago.”

The bottomline: Here’s the irony of this year’s Davos. It risks losing its relevance exactly at a time when both the pandemic and climate change have shown us that it is more urgent than ever for the powerful to find solutions together.

Reading list

For the best critique of the Davos Man, read Peter Goodman in Vanity Fair—and CNBC for more background. This older Business Insider piece has a good overview of the Forum—while BBC News offers amusing trivia. New York Times and this analysis in Qrius offer a strong defence of the value of the WEF. Also worth your time: New York Times on Davos’ existential crisis and Deutsche Welle on the shadow of Russia over the Forum. Quartz rounds up the list of this year’s attendees.