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Davos: The real story

It's all about freeloading fatcats and nothing constructive ever gets done. Right? Not quite. David Randall reveals the unexpected truth about the World Economic Forum

Davos? It's just a beanfeast for fat cats, isn't it?

Fat cats is a bit sweeping. Highly paid and cosseted, yes; exploiters of the toiling classes, not necessarily. There are 2,500 attendees from 96 countries at Davos: 1,400 business leaders, 219 "public figures", 432 heads of NGOs, 225 media bosses, 149 academics, 15 religious leaders, 11 union chiefs, plus assorted others, and a media circus. About 7,000 folk in all.

Well, whoever they are, they're just hobnobbing, aren't they?

There are 214 public sessions over five days, covering everything from nanotechnology and a cure for cancer, to cloud computing and, of course, the financial crisis. And don't knock hobnobbing. A lot of the value is in the private encounters – first, with people you know; second, the serendipity of bumping into someone you don't. Take this year. Here you have, a mere handshake away, world leaders (41 heads of government) and the likes of Peter Mandelson and George Osborne (their mutual friend Oleg Deripaska has paid but not shown yet). So the governor of Brazil's central bank can bump into the chairman of British Airways; the boss of Credit Suisse can meet the presidents of several of India's largest firms, and Larry Page of Google could sit next to the secretary-general of the League of Arab States. It's called networking.

Networking! Just a fancy name for going on a freebie, doing each other favours and lining their own pockets. Right?

Not entirely. And a freebie? Well, it's their organisations that pay, and it's not cheap. Membership of the World Economic Forum is £25,989.70, and each attendee pays £11,007.40 to be there. And things do get achieved here.

Such as? I mean, what has Davos ever done for ordinary people?

Well, in 1990, Helmut Kohl, the West German Chancellor, and Hans Modrow, the East German Prime Minister, held talks on reunification at Davos. In 1992, Nelson Mandela and F W de Klerk, the South African President, appeared together at Davos. The process that led to the Uruguay Round of trade agreements started at Davos. Then...

Yeah, but...

In 2000, the Global Alliance for Vaccines and Immunisation – bringing health prevention to millions of children in the developing world – was launched with a $750m (£522m) donation from the Bill and Melinda Gates Foundation. In 2002, he pledged $50m (£35m) for Aids prevention in Africa, and he has used Davos to start other health initiatives. And...

OK, yet...

In 1988, Davos brought together the leaders of Greece and Turkey to begin talks to resolve their differences. There were stumbles, but it was the beginning of a process that led to peaceable co-existence.

All right, so...

And in 2005, Sharon Stone went and, just by asking business leaders face to face, in five minutes raised $1m to protect children from malaria...

Is there much more of this propaganda?

Quite a bit. We haven't even talked about the initiatives launched by the World Economic Forum. This year's include one on managing scarce water resources, and another on getting firms involved in employee healthcare.

OK, supposing it does some good, why meet at a swanky skiing resort in Switzerland? Why not hold it somewhere less ostentatious?

Yes, Davos as a venue does send unfortunate signals, but it's where the World Economic Forum started 38 years ago (444 turned up and the top speaker was J K Galbraith, the economist); the security's good (it needs to be – there have been violent protests, notably in 2001); it's reasonably central; it has the facilities; it's so small people can't help bumping into each other; it's not that upmarket (it has a McDonald's); and it's used to handling swarms of world leaders at once. Besides, I don't think they'd get the attendance if they held it in Folkestone.

Now you're being silly.

Not really. These folk don't do hair-shirt. You could stage it at a Travelodge, but not many would come – which rather defeats the object.

The attendees are nearly all middle-aged, aren't they?

Not all of them. Rupert Murdoch, who's there this year as usual, is 77. But I guess what you're getting at is that there are no young folk there. Well, two answers to that. First, people running major companies and countries tend not to be under 50. Second, the World Economic Forum does recognise people under 40, with its Global Leaders for Tomorrow programme. Past selections include Anousheh Ansari, a young woman who runs a venture capital firm in Texas; Sergey Brin, the co-founder of Google; and Tyler Brûlé, the Canadian-born, London-based media entrepreneur.

Mere tokenism!

And your solution would be?

Never mind about that. What about women? Not much evidence of them around Davos, is there? Not unless you count the chambermaids, waitresses, secretaries, bosses' daughters doing internships etc.

True. Davos is unashamedly elitist in that it reflects the composition of the élite as it is, not as it should be. And that, of course, happens to be mainly middle-aged and male. What can be levelled at attendees and organisers is that there has not, down the years, been much in the way of attempts to debate and study inequality, glass ceilings etc. Occasionally, the issue of gender does raise its head. Yesterday, Davos had a session entitled "The girl effect on development", which considered this: "An educated girl will invest 90 per cent of her future income in her family, yet little more than half a cent of every international development dollar is spent on her. What needs to be done to realise the potential of the 'girl effect' on developing economies worldwide?"

But, apart from that, not much emotional intelligence on offer then?

Well, the sessions and speeches are surprisingly diverse. Past ones have included "Teleportation and other ways quantum physics might improve your life"; Julian Lloyd Webber on the "madness" of avant garde, atonal music; Carl Sagan on the end of the universe and other planetary mysteries, and a 1999 seminar from a professor of neurology entitled "Where did I leave my keys? The mysteries of memory". And they once had one called "Can't we just all get along?" led by His Beatitude, Dr Anastasios, Archbishop of All Albania.

The Archbishop of All Albania? You'll be telling me next that Mother Teresa turned up one year.

Yes, she did. For a "spiritual breakfast" in 1990.

Some of the Davos regulars haven't matched her standards of virtue, have they?

No. Habitués have included Robert Maxwell; Abbas Gokal, the former shipping magnate and one of the fraudsters behind the BCCI scandal; Kenneth Lay of Enron; Conrad Black...

OK. But are you asking me to believe that the business and political leaders who've so far kept out of jail go to Davos in a spirit of scholarship and altruism?

That, I think, especially for the political leaders, is part of the motive. Others like the sound of their own voice. Most hope to learn something (especially if it's to their advantage), pick up on a trend, do a deal, make contacts, and learn about other countries and industries.

I'll accept that, to some extent.

Well, you wouldn't be the first doubter to change tack. Lord Carey, the former Archbishop of Canterbury, became a Davos regular after he had, as he put it, "a kind of conversion. I saw very clearly how important wealth creation is to peace and prosperity and to overcoming deep poverty." Others think that Davos has too much emphasis on politics, that it has become "anti-business". Sir Digby Jones, then director of the Confederation of British Industry, said four years ago: "Too many of the sessions have been an excuse to beat up on business... The pendulum is swinging too far in favour of the NGOs... Davos has been hijacked by those who want business to apologise for itself."


So you're no longer so cynical about Davos?

I wouldn't go that far. I suppose what I'm really saying is that when I hear the word "Davos" I instinctively count my change. After all, these are the people who've buggered up the world economy, and now we're supposed to hang on their every word as they swan around Davos?

Well, that's the dilemma we're all in at the moment, isn't it? Whether you're a chief executive, or out of work, business is the problem – but it's also the solution. It's better that business leaders are attending Davos than some investment seminar run by the next Bernie Madoff.