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Davos Debrief: Data, Power, Happiness – It’s Getting Personal

 

Following a year in which “people power” was the rallying cry from the Arab Spring to Occupy Wall Street, the World Economic Forum (WEF) Annual Meeting 2012 in Davos, which ended last Sunday, might seem like an elitist anachronism, but it is worth noting how the WEF over the past few years has tried in earnest to include voices from civil society as well as younger generations – from new, very active communities within the WEF such as the Young Global Leaders and the Global Shapers to – this year – even Occupy Davos. The result: As a “platform for multi-stakeholder dialogue between business, society, and politics” (in the words of WEF founder and executive chairman Professor Klaus Schwab), the WEF is more relevant than ever (full disclosure: I am a member of the WEF Global Agenda Council on Values in Decision-Making).

That said, the Annual Meeting in the luxurious Swiss ski resort remains the “the world’s most exclusive gathering,” and it is hard not to be star-struck by a cast that this year included the likes of Bill Gates, Timothy Geithner, Christine Lagarde, David Cameron, Angela Merkel, the CEOs of most Fortune 500 companies, and – yes – Mick Jagger.

This year’s theme was The Great Transformation (borrowed from Karl Polanyi’s seminal 1944 book), inspired by the urgent need to explore new models of leadership and value-creation in the wake of a fundamental (identity, confidence, moral?) crisis of capitalism (sovereign debt crisis, lack of trust in business, growing inequality, etc.). Consequently, Professor Schwab remarked in his opening speech: “Davos is the world’s sanatorium,” referring to the local facility that rose to world-literature fame through Thomas Mann’s novel The Magic Mountain. The mood was definitely somber, at least in the beginning, and lightened up only a few days into the conference when the intense debates and working sessions brought forward more optimistic approaches to solving the world’s pressing problems.

The main topics in Davos were the Euro crisis (of course); the Network Economy; Big (Personal) Data and its implications for our concepts of privacy, productivity, and collaboration; and Values (converging several strands such as Michael Porter’s more integrative “Shared Values” notion of corporate social responsibility, the rise of social entrepreneurship, or the quest to explore happiness as an alternative metric for measuring economic progress, both at a national and company level - more on that later).

If there was one overarching theme for all these tropes, then it was the dialectic relationship between the potential and the risks of technological innovation. One the one hand, optimists were bullish about the digital revolution that has given amateurs unprecedented access to technology, as Neil Gershenfeld, Director, The Center for Bits and Atoms, Massachusetts Institute of Technology (MIT), noted: “Technology is allowing ordinary people to change and improve the world.” This becomes manifest in digital literacy, grassroots innovation movements such as Maker Faire, 3D printing, the mobile apps developer ecosystem, open data, and hackers-for-good communities. And the emergence of cloud computing means than anyone can quickly launch data-intensive businesses, which is accelerating innovation, product cycles, and competition.

On the other hand, the gap between individual understanding and technological progress seems to be growing. People’s fears about misuse of personal data, which led the European Commission to propose rather draconian data protection laws for Internet service providers and other data collectors, is creating a “huge barrier to progress,” observed David Blumenthal, Professor of Medicine and Professor of Health Policy at the Harvard Medical School, and a member of the WEF Global Agenda Council on Digital Health. The general public needs to better understand science and technology, he urged.

Public Parts-author and digeratus emeritus Jeff Jarvis sees the digital revolution disrupt every single industry and institution, and believes that technology is leading to an “efficiency over growth” paradigm, with far-reaching implications: “Productivity will improve. Companies will be more profitable. Wealth will be created. But employment will suffer.” Jarvis acknowledges that great wealth can be created by serving millions of people with relatively small staff – see Google, Facebook, Amazon, and other icons of the digital economy – but he cautions that this might just further widen the income and capital disparity, which is “just wide enough today to cause unrest around the world,” as he writes on his blog. “That’s much of what #Occupy_WEF et al is about. That’s what is causing such tsuris and uncertainty on the stages of the world (Economic Forum). That’s what is causing the institutions represented here to fear, resist, and regulate technology in the hopes of forestalling the change it is bringing. There is the root of the disruption we’re witnessing now even in Davos.”

The Arab Spring exemplifies the ambivalence societies presently face when it comes to technology. Yes, technology has given ordinary people, particularly the youth, a voice to question the status quo and the power to even topple regimes. It has created and amplified (a sense of) urgency, and it has opened the door to being part of emerging governance, but as we witness in Tunisia, Egypt, and Libya, it has not necessarily enabled the creation of stable, truly inclusive governments and economies that produce the kind of steep job growth these countries so desperately need.

Technological innovation is also overshadowed by widespread pessimism and a credibility deficit that have resulted from the failure of institutions to effectively deal with a number of the recent economic and environmental crises. Trust in government and business has further plummeted, reports the Edelman Trust Barometer 2012, and there appears to be a fundamental loss of confidence in decision-making, with large parts of society – particularly young people and the majority of the impoverished – feeling that they’re being left out of the process, despite the democratizing effects of social technology and media. Some in Davos therefore called for a new “social covenant” that mandates fairness and mutual benefit for all, but not only by redistributing wealth more evenly, but by including all parts of society in the creation of wealth (“inclusive growth”) and the decisions that drive it.

But here’s the problem, as far as business is concerned: While there is broad consensus on corporations’ means (and responsibility) to positively impact society (the leadership role of business, so to speak), business leaders themselves may no longer be the right people to spearhead it. Sure, corporate bosses still hold considerable sway over creating a meaningful experience for their employees (they can “create and kill meaning,” asserts the McKinsey Quarterly). But although CEOs are undoubtedly held more accountable than ever, they are facing not only an erosion of trust but also an erosion of their power. A recent Economist article describes these "shackled CEOs" as Gullivers who are tied down by Lilliputian forces – whether these are powerful boards, empowered employees, or a public that demands radical transparency. Consequently, among the world’s 2,500 biggest public companies, the average job tenure for departing CEOs has fallen from 8.1 years in 2000 to 6.6 years today, according to consultancy Booz & Company. In light of this trend, buzz words such as “humble leadership,” “servant leadership,” “open leadership,” and “bottom-up leadership” make the rounds, and Doreen Lorenzo, the president of frog, contends that the increased complexity of decision-making will lead to a “post-CEO world” where companies must move “from a guru model to one based on team leadership.”

Ironically, at the political level, the most inclusive model, democracy, is losing its halo, as it becomes pressured by ever-more demanding citizens whose frustration with their elected representatives and more publicized cases of corruption, nepotism, and decision paralysis is nowadays quickly amplified by social technologies. The Euro zone may be on the brink of disintegration, and the democratic legitimacy of the European Union, with so much policy-making power delegated to supranational authorities in Brussels, remains questionable.

The potent alternatives were on show in Davos, but not everybody may 'like' them: For one thing, there is state capitalism, which can claim credits for driving recent history’s most remarkable economic success stories: Singapore, Russia, Brazil, the UAE, and of course China. Over the past three decades China’s GDP has grown at an average rate of 9.5% a year, and over the past ten years its GDP has more than trebled to $11 trillion. This makes it the world’s second-biggest economy, and the world’s biggest market for many consumer goods.

A digital governance alternative is Facebook, arguably the world’s most powerful transnational organization, with a network of users that would count as the world’s third largest country. It already stores more data than any national government alone, and with its popularity, network effects, and comprehensive analytics, it holds significant deterministic powers: it can mobilize communities, influence constituents, predict trends and events, and draw a possibly discriminatory line between inclusivity and exclusivity (“weblining,” as law professor Lori Andrews calls it in her NY Times article “Facebook is Using You”). Like Google, it is inevitably evolving into the “The Matrix” or the uber-stream of what David Gelernter prophetically anticipated in 1990 as “Lifestreams” – albeit with little to no space left for ambiguity: the vision of a data-centric universe is one where human decision-making will be binary, with targeting so chirurgical that every '(life)stream of consciousness' will end with a clear ‘yes.’

Conversely, optimists herald the same personal data as a potential source for human development (e.g., through e-philanthropy or open-data initiatives such as the Worldbank’s) and refer to the rise of social innovation, social entrepreneurship, for-profit activism, and the concept of the Social Enterprise (as in Marc Benioff’s “Speedy-Open-Collaboration-Individuals-Alignment-Leadership” line). All of which are all fueled by the “new oil” data, if only it is put in the right hands.

And data can propel happiness, which has emerged as the buzzword de jour in business circles, also in Davos. Zappos CEO Tony Hsieh has established it as his mission and primary business objective (shoes are just a means to an end), and his book Delivering Happiness was a national bestseller. Virgin, Coca-Cola, and other consumer brands have made it their core brand promise. Healthcare companies, and other industries, are looking into social products and services to promote it. After the King of Bhutan pioneered a Gross National Happiness Index in 1972, initially subject to much ridicule, NGOs such as the New Economics Foundation have been promoting it, and more and more corporations and governments (UK, India, France, etc.) are now exploring happiness as a holistic metric for economic progress and effective governance. And the Harvard Business Review, in its current issue, even devotes a special report to the "Value of Happiness,” arguing that employee well-being can boost productivity, customer loyalty, and ultimately profits. Two years ago, who would have thought that this publication had a cover on happiness! It seems as if the tougher the times, the harder the soft topics become. This is encouraging.

The Future Is Not What It Used to Be: Predictions for 2011 to 2050, Already Obsolete

It’s that time of the year again. The trend augurs are releasing their predictions for the coming year. Except for the analyst firm Gartner, that is, which already shared its "Top 10 Strategic Technologies for 2011" in October this year – we shall see if the first-mover advantage will make them more accurate. The best forecast might still be the agenda for Davos, simply because many of the participants have the power to actually make the future happen.

Michael Schrage does not, but he is a keen observer. His “Top Six Innovation Ideas of 2011” set the theme for the whole bunch: since radical events of the 'black swan' kind are understandably hard to predict, professional future gazers usually focus on highlighting existing trends and their continued yet amplified impact in the new year. Another typical feature of trend lists is the excessive use of neologisms, preferably in the form of the noun-ification (oops) of nouns which untreated would sound all too common. Schrage, for example, coins the term “contestification” (“contests”? – nah!). Apart from that though, his list is interesting and sound: he cites touch screen user experiences (“having the right touch to get the right touch will become a desirable communications competence”); “WWWabs” (“not-quite-ready-for-prime-time alpha and beta versions of apps to explore and test”) as valuable playgrounds for companies as they shift from “R&D” to what Schrage calls “E&S - Experiment & Scale;” the rise of promotional platforms (“advertising will take a backseat to promotional offers as retailers and brand managers alike collectively decide that branding a promotion matters just as much as promoting a brand”); the “gameification” (here, he did it again!) of business (“the companies that succeed in gameifying their products, services, and brands will enjoy a certain Zynga in their step”); and the renaissance of lobbyism (“a charismatically innovative lobbyist may have a bigger impact on marketplace success in 2011 than the country's most savvy technologist or marketer”).

TechCrunch’s Erich Schonefeld seems to have looked into the same crystal ball as Schrage. He, too, argues that 2011 might be the year when “touch becomes central to the computing experience.” And in his tete-a-tete with writer and blogger Andrew Keen he addresses head on the warnings of pessimists like VC investor Fred Wilson who contend that irrational exuberance will inevitably lead to another crash: "Will 2011 Be 1999 All Over Again?"

Even further back to the future goes Alvin Toffler, the grandfather of futurology, who is not content with foresights for just the next year; he predicts “40 for the Next 40” – trends that will shape our world from now to 2050. It has been 40 years since he popularized terms such as “knowledge age,” “power shift,” “digital revolution,” or “information overload” in his landmark book Future Shock, all of which are now part of the mainstream lexicon. That alone should make you curious, but the outlook released this week by Toffler Associates is a bit of a letdown. Toffler still has an apparent knack for condensing disparate phenomena into succinct assertions, but none of his predictions are really surprising (just some examples: the growing geo-political power of ‘philanthro-capitalists' who eclipse national and multi-national organizations in influence on many global issues; a growing number of women in leadership positions; religious groups pushing to get into governments around the world; the continued rise of “open, collaborative innovation paradigms;” mass production that is increasingly replaced with on-demand, custom manufacturing of products and services, etc.).

But maybe that’s not the point. If “the future is already here, just unevenly distributed,” as William Gibson famously stated, then the futurologist’s task might indeed just be to collate various dispersed pieces and even out the distribution by elevating the predictable to the status of meta. Foreseeing the future is like innovation: a new application for an existing invention. There’s nothing wrong with that.

The most interesting example for this approach is one of the more provocative predictions in Toffler Associates’ report. Coining the term "obsoledge" (yep, another neologism, but more inventive than Schrage's), the group refers to knowledge's increasingly extremely limited shelf life and stresses that every chunk of knowledge will eventually become obsolete. Applied to Toffler’s own foresights, this means of course that everything we now purport to know about the future may not be necessarily wrong, but it may not matter anymore when the future arrives. In light of accelerated technology cycles, as well as economic and political shifts that will be as sudden as they are drastic, it might become more difficult for us to catch up with the future. In this sense, perhaps the next true “Future Shock” will be that in 40 years from now none of Toffler’s predictions will have become part of our cultural fabric, and we may not even recall any of them. In the best and worst possible cases, the future will finally be what it has always been – fully beyond our imagination.

[photo: Per Forsberg]

India: Urgent Emergence

This was India’s year. Obama visited, as did Sarkozy, and many other statesmen of lesser political weight or star appeal. With an annual growth rate of close to 8.9% and foreign direct investments projected to exceed $100 billion, the booming Indian economy defied the global recession. For the first time ever, eight Indian companies made it onto the Fortune 500 global list. And even PR crises like the ill-organized Commonwealth Games and political corporate scandals that were an easy target for India’s cynical media did not eclipse the nation's staggering rise – in fact, these events just seemed to magnify the spotlight. Without a doubt, the sub-continent became ready for primetime in 2010, and to many outside observers a new confidence appeared to take hold of India’s economic and intellectual elite.

This year also marked my first visit to India. I had the privilege of assuming leadership for a team in Gurgaon (New Delhi), Bangalore, and Chennai, and to immerse myself in a country I had never been to before. I vividly remember the first five minutes after my arrival at Indira Gandhi International Airport in Delhi in September, the dusty air, the thick fog, the vanilla scented perfume tree in the car, and the calm driver whom I, for lack of any alternative, decided to wholeheartedly trust as he was racing me to my hotel amidst the polyphony of honks. Other countries are in your face or slowly creep into your soul with their mores, oddities, and sensations. India is around you, all the time. It is simple as the tourist cliché of itself (especially when you live in the airport-lounge-and-luxury-hotel bubble of the global business traveler) and yet complex as a vertical staggering of infinite parallel worlds which make sense each by themselves but fail to strike a consonant chord – like in the movie Inception.

When I attended the India Economic Summit in Delhi in November a few weeks after my first trip, jointly hosted (for the 26th time) by the World Economic Forum and the Confederation of Indian Industry (CII), President Obama had just passed through India, leaving an indelible mark on the Indian collective psyche with his now famous line that “India is not emerging, it has emerged.” The mood was bullish, if not exuberant, and many considered the visit a breakthrough moment for India. The economic reality had not changed but the awareness of the sheer scale of the opportunity ahead and the self-assurance that it might indeed be feasible to accomplish it, had moved to a whole new level, seemingly overnight. No wonder the optimism was palpable at the Summit.

The official theme was “Implementing India” but the actual theme that emerged during the three conference days was “Inclusive Growth” – how can India sustain its tremendous growth and at the same time narrow the social divide? While India’s growth numbers are impressive, many of the speakers acknowledged that its so-called “demographic dividend” (a term coined by Harvard demograph David Bloom) is a double-edged sword. By 2020 half of India’s population will be below 25, and it will account for 25% of the global workforce. But this demographic trend is unevenly distributed. India’s northern states, with their high fertility rates, are the main contributors to population growth (by 2025, the median age will be 26) whereas the south faces rapid aging (a median age of 34 by 2025). This means that “India’s demographic dividend is actually a double hump, one of which is already nearly exhausted,” Infosys co-founder Nandan Nilekan writes in his seminal book Imagining India.

This “double hump” makes capitalizing on the remaining, “unexpensed” demographic dividend rather urgent. Experts foresee a demographic disaster unless India’s young workforce is properly skilled and employable by global standards. Unfortunately this is far from being the case today: For starters, 300 million people live in extreme poverty, that is, they live on less than one dollar per day, and 90% work in the informal economy. 70% of India’s 509 million-strong working population has not received a primary education, and only 11% of those aged 17-23 receive a higher education. India has the lowest education indicators among the G20 economies and the world’s highest number of illiterate people. One of the main challenges for India will be to create jobs for the 270 million people expected to enter the working-age population over the next 20 years. Will these people become the world’s workforce, as some predict, or the world’s worry?

Sustainable growth, many argue, will come from frugal (or reverse) social innovation, through public-private partnerships that scale at the base of the pyramid. It is well known that IBM has more employees in India than in any other country, and many of India’s big IT outsourcing companies (e.g. Wipro, Infosys, Tata Consultancy Services etc.) have long been competing with multinationals. But no longer is India just the development center of excellence of the world or an emerging consumer market of massive scale; it is increasingly home to bottom-up innovations in areas such as energy, healthcare, and automotive, spurred by the urgency of structural change. Crisis has always proven to be a hotbed of innovation, and the need to improve the livelihood of a society is a powerful driver for entrepreneurship.

India is already the front of some radical product and service innovations such as the $3,000 car or the two cents per minute nationwide cell phone service. Moreover, with the deep penetration of low-cost telephony, the country’s emerging middle class could be a testing ground for the burgeoning mobile health (mHealth) technology market, in particular telemedicine and rapid diagnostic services. Globally, mHealth revenues are projected to grow by 25% annually, from $1.5 billion in 2010 to $4.6 billion by 2014. India is seeing many of its pioneering efforts, for example start-ups such as mDhil and eHealthpoints. The Indian healthcare industry, in general, is one of the fastest growing sectors of the economy, growing at 23% per annum.

A basic enabler of “inclusive growth” is to provide the rural population with access to information- and communication technologies and financial services. Although India is the second largest telecom market in the world and tele-density has increased to 56.6% in 2010, 44% of rural Indian households are still unwired, and of India’s 6,000,000 rural villages less than ten percent have a local bank branch. Microfinance, long heralded as an able solution to this shortcoming, has recently suffered a serious setback. The rapidly growing private microcredit industry faced imminent collapse when almost all borrowers in Andhra Pradesh, one of India’s largest states, stopped repaying their loans. Critics accused microfinance institutions of making “hyperprofits off the poor” by extending loans to poor villagers at exorbitant interest rates and without enough regard for their ability to repay. It will take some time for the industry to restore trust (and some more regulatory oversight from the state will help, too). But again, this crisis may spur much needed innovation in the Mobile Money space.

India’s villages are increasingly becoming a breeding ground for innovation, as its rural poor develop inventions out of necessity. Mansukhbhai Jagani, Mansukhbhai Patel, Mansukhbhai Prajapati, and Madanlal Kumawat, and three others are on a recent Forbes list of rural Indian entrepreneurs (compiled by IIM-Ahmedabad professor Anil K. Gupta) “whose inventions are changing lives” of the people across the country. Jagani developed a motorcycle-based tractor for India's poor farmers, which is both cost effective – costing roughly $318 – and fuel efficient. A farmer, Patel invented a cotton stripping machine that significantly cut the cost of cotton farming and revolutionized India’s cotton industry. Prajapati, a potter, invented a clay non-stick pan that costs Rs 100 and a clay refrigerator that runs without electricity for those who cannot afford a fridge or their electricity and maintenance costs. Madanlal Kumawat, a grassroots innovator with no more than a fourth-grade education, developed a fuel-efficient, multi-crop thresher that yields cleaner grains, which can be bagged directly and eliminates the cost of cleaning.

Design and design-driven innovation are quickly entering the business vocabulary here, too, and when I met with editors of business publications in Delhi a few weeks ago, their interest in design was as keen as their conviction that India will soon become a powerful innovation engine with global impact, propelled by a distinct national design style and a throng of young, ambitious, and fearless entrepreneurs. It will require a mix of national policy and education providing the economic framework, global design and innovation firms bringing quality standards and best practices to India, and – perhaps most importantly – Indian companies embracing design as a key differentiator and value-driver, with some quick and visible market successes.

Whether you’re strolling through Old Delhi or driving along the campuses of Bangalore’s IT firms, you can’t help but marvel at the tremendous pace with which the country and its people are happening. The whole country is on the move, which offers plenty of opportunities for upward social mobility but also disrupts traditional lifestyles and cultures. New high-rise developments for the burgeoning middle class (91 million urban households are projected to be part of it by 2030, up from 22 million today) stand in stark contrast to the poor villages right next to them, which are in the progress of upending their local identities and cultural roots. According to the United Nations Development program, it is expected that 41% of India’s population will live in cities by 2020, compared to less than 30% in 2010. That is 590 million people, nearly twice the population of the US today. A recent McKinsey report (“India’s Urban Awakening: Building Inclusive Cities, Sustaining Economic Growth”) estimates that 70% of net new employment will be generated in cities by 2030 and that 85% of total tax revenue will come from the urban economy.

Needless to say, that this migration will further contribute to stresses on the already insufficient infrastructure. McKinsey expects 68 Indian cities to have a population of more than one million by 2030 (up from 42 today vs. 35 in Europe). It warns that the current urban policy framework will lead to urban decay and gridlock. Today, India is investing eight percent of its GDP in infrastructure, which is a high number by international standards. And as much as $300 billion are forecast to be devoted to urban infrastructure over the next 20 years, a twofold increase in per capita spending of $17 today. But McKinsey believes that $1.2 trillion capital investments are necessary to meet the projected demand in Indian cities. The firm proposes fundamental city governance reforms to ensure these funds are not only raised but put to work efficiently. Unlike China, India cannot issue sharp policy shifts to appease a young population that may not be satisfied with the living standards of their parents. If urban policies fail, social upheaval, fuelled by underlying religious and ethnic divides, will likely be the result. Or as Nandan Nilekan puts it: “This is our biggest, but also our last chance.”

India is aware of its “moment” and understands that the window of opportunity for inclusive growth is limited. The government is seeking to balance the hustle, the frenzy, and the urgency with calm and confidence. It is the only possible attitude when you have to govern what seems to be genuinely ungovernable. I thought of a line from a song by Thom Yorke: “You have all the time in the world. Don’t squander it.”

[picture: painting by Vangobot. Vangobot is "a robot who paints with the soul of the human artists who taught him how to see."]

SOCAP09 (Social Capital Markets) Conference Brings Together Social Innovators from Government and Business

The Social Capital Markets (SOCAP) Conference, a landmark gathering of top business and government leaders creating market-based solutions for social impact, is taking place September 1-3, at San Francisco’s Fort Mason Center.

SOCAP brings together a unique mix of the world’s leading social innovators – traditional investors, impact investors, social entrepreneurs, philanthropists, new media, NGO’s and non-profits, wealth managers, development agencies, venture capitalists, MBA students and other groups interested in the growing opportunities of social capital — who are catalysts of change across the globe.

Last year’s conference gathered more than 650 leading global investors and entrepreneurs from 26 countries. This year’s conference from September 1-3 in San Francisco is sold out again and features speakers from the Skoll Foundation, Participant Productions, Food Inc, GRITtv, LINKtv, Invisible Children, Global Giving, the World Economic Forum, Virgance, Kiva, Change.org, Ushahidi, McKinsey, The Economist, and many others. The opening keynote will be given by Sonal Shah, Director of the White House Office for Social Innovation.

“SOCAP09 is the premier event that puts the flow of capital to social good into a context,” says Founder Kevin Jones. “In these turbulent times, social innovators in the public and private sectors, from foundations to social venture funds to development agencies to grassroots Web 2.0 activists, are working together to build a new economic foundation for the world. With our expert speakers, high-impact sessions and exciting networking events, SOCAP09 is an essential gathering for anyone interested in the burgeoning field of social capital.”

I will be there, too, and report. You can also follow the conference online via:

SOCAP09 Blog

Twitter: @socap09,#socap09

The One Thing (Question) For A Better World

In fin d'année mood, saving the world is en vogue -- and asking the "one thing" question obviously, too.

Inspired by Leonardo DiCaprio's gloom and doom documentary "The 11th Hour," OnEarth magazine asked a panel of leading scientists and activists to move beyond bleak diagnoses and offer concrete proposals for a sustainable future:

"Which one thing would you do to save the world?"

You can read a transcript of the entire conversation here.

Slightly modifying OnEarth's impetus (and oddly phrasing it), The World Economic Forum (WEF) asks the "Davos Question:"

"What one thing do you think that countries, companies or individuals must do to make the world a better place in 2008?"

Unlike OnEarth, however, the WEF does not seek the advice of experts and instead relies on the crowd. Everyone can upload suggestions on YouTube and make his/her "voice heard in Davos." The highest rated videos will be screened on January 23-27 during the Forum. The world leaders will then be asked to video-respond on YouTube.

Echoes of Davos: “Green is the New Red, White, and Blue.”

I attended a de-brief session on this year’s World Economic Forum (WEF), hosted by Swissnex, an annex of the Swiss consulate in San Francisco. The organization had invited three Davos veterans to discuss the “echoes” that reverberated from the five-day gathering of the world’s (thought) leaders in the Swiss Alps. The panel included John Markoff, senior writer for The New York Times, Ann Winblad, partner with Hummer Winblad Ventures, and Paul Saffo, a forecaster and essayist and fellow with the WEF.

Markoff moderated the panel with a nonchalant distance to the celebrity entourage for which Davos is famous. The anecdotes that Winblad and Saffo were happy to share with the audience, made for a lively overview of what the rest of us missed. Markoff started with the provocative assessment that Davos may perhaps have peaked in the Clinton years. Saffo, who has attended the Forum for 15 years in a row, agreed but found the intense days, which are rich in unexpected encounters with people from very different arenas of business, politics, and culture, still extremely challenging and inspiring.

“The Shifting Power Equation” was this year’s theme, and the panelists agreed that it was, although determined in September of last year, timely and spot on. First of all, interestingly enough, all three panelists observed that it was the first year in Davos that the United States (after sympathy and solidarity in 2001, criticism in 2002, 2003, and 2004, and open opposition in 2005 and 2006) seemed somewhat marginalized. Saffo noted that there was a clear consensus that the nation-state order is on the wane and that the “US is caught between being too weak to really influence events, but too powerful to be completely ignored.” Delegations from China and India were omnipresent and the "Indian reception also had the best food," as Saffo noted happily.

Besides the shift of economic power to new regional heavyweights, there was broad consensus about a more philosophical but nonetheless dramatic shift to the agenda of all economic players: climate change is now widely seen as the top priority. No one really questions the urgency of counter-measures any more, said Saffo. In one of the many pre-functions of the Forum, the DLD conference in Munich, Sir Norman Foster poignantly called “Green” the “new red, blue, and white.” This is a carefully chosen phrase indicating that “the green corporation” is not just the “new black” and thus another short-lived trend. Rather, it is rather a fundamental stakeholder requirement and the main current of businesses’ “social contract” for the future. Saffo saw a sea-change at work in the business leader’s thinking: The discussions about climate change went, in his eyes, far beyond the traditional do-good corporate responsibility.

Yet there are no easy solutions and Saffo still sensed a “vast uncertainty” regarding the ability of global institutions to meet the challenges we all face. Saffo pointed out that Davos is not supposed to provide answers or closure, rather, it is a place where questions are raised and conversations begin – it’s about “opening minds.” He described how he found himself to be an “entertainer” among all the “really powerful men and women driving the world economy and said: “if there were a place for a conspiracy of the world’s most powerful, then it would be in one of these conference rooms at Davos. But if you look at their faces, you realize that they're struggling with real answers to the pressing problems themselves.”

Anne Winblad struck a more pragmatic chord and commented on some of the other issues at Davos such as what she described as the “Web 2.0 invasion.” She scoffed at how web 2.0 entrepreneurs such as Catherina Fake from Flickr or YouTube's Chud Hurley were treated like popstars and bloggers were ueber-present without really mattering (some may disagree, see The Davos Conversation blog). Second Life, of course, was virtually present in all conversations, too - view this video below that Jeff Jarvis (BuzzMachine) shot at a WEF reception of German publisher Hubert Burda ("How many of you have avatars?"). A man in the audience remarked that bloggers could be for the Forum what bees are for the beehive: they bring the honey into a seemingly chaotic organization that becomes a smoothly running system because of their very contributions, following a seemingly secret logic. Wikinomics, in other words.

The other “new royalty” at Davos were the big private equity firms. Private equity earned quite a bad rep lately and now the industry has responded by setting up a foundation to improve its image. PR work yielded first results: Several articles in the international press this week painted a more differentiated picture of private equity investments, referring to research suggesting that companies refloated on the stockmarket after private ownership performed better than other new issues. According to an Economist article, studies also find that investors have done well so far of private equity, with the average buy-out fund beating the S&P 500 index in 1980-200.

All three WEF attendees agreed that Davos is still an extremely relevant place and not only an intellectually enriching experience but also good business, worth every dollar and minute you spend (at least $25K, according to the panelists, and little sleep every night): “If you refer to a meeting or a conversation in Davos, your call will be put through right to the top of any organization.”

Click here to read the session summaries of the 2007 World Economic Forum