László Andor, is a Hungarian economist and former European Commissioner for employment, social affairs and inclusion. Having visited Davos three times in recent years, he gives us his take on what actually goes on up in the Swiss mountains – far from the rich supervillains’ lair of popular imagination, he finds a collection of influential leaders genuinely reflecting on the pressing social and political concerns of our times.
- Davos has grown from a small event to the world’s largest gathering of business, political, social and cultural leaders
- Despite a popular reputation for elitism, secrecy and ruthless business-dealing, participants enjoy genuine discussions about serious social and political questions
- The issue of inequality has become increasingly prominent on the Davos agenda in recent years, as has the negative impact of concentrated wealth on the quality of our democracies
- Whether the outcomes of the discussions fully translate into everyday practice when participants return home remains an open question
It is indeed the so-called elites that gather in Davos every January. It is the global business elite but also representatives of the political elites: presidents, prime ministers, ministers of economy and finance. Some leading lights of economic science, with or without the Nobel Prize, are also among the regular guests. The outside world and especially those critical about capitalism, are no doubt often left to wonder what exactly is going on up there.
The big Davos as we know it today grew out of a smaller event. The World Economic Forum (WEF) has grown to become the world’s biggest informal summit of private sector and governmental decision makers. Economies of scale play a role here: you can spend a few days in Davos, and have a multitude of bilateral meetings for which otherwise you would need to travel across many countries or even continents.
Yes, the smaller meetings in Davos are either private or take place under “Chatham House Rules”, but this would also be the case had this happened in a company headquarters or even public institutions like universities. There are also many other lectures and discussions that are televised or at least open to journalists (who also are there in large numbers).
More than ‘just business’
Whilst a misplaced snowball in Davos during the WEF could easily hit a CEO of a major company, it is wrong to assume that Davos debates are mainly about business deals. Those whose daily business is to manage their companies more efficiently than others do, come here to exchange views about more than short term profits. Actually, Davos is the time of the year when big business stops focusing solely on just ’doing business’, and spends a few days thinking about the issues of society, politics and the environment.
Davos is often criticised for too few women participating, but this forum regularly brings experts and decision makers into a common discussion about how to break the glass ceiling and increase the share of women among entrepreneurs, scientists and political leaders.
Among the participants of the annual events you also find European Union Commissioners. In my case (altogether three appearances within the space of five years) going to Davos was used to promote the employment and social policy initiatives we designed in Brussels. An example is the EU Youth Guarantee scheme, for which we made a proposal in Brussels at the end of 2012. I had no difficulty selling it to a socially democratic prime minister, with whom I regularly met before some of the European Council meetings. In Davos, however, I could just bump into Fredrik Reinfeldt, the centre-right prime minister of Sweden, and discuss with him the merits of our proposal. And one evening, which can almost be called a night, I had the chance to meet the Irish Prime Minister (Taoiseach) Enda Kenny, and elaborate on the adequate funding of the Youth Guarantee.
With George Soros, I discussed why and how more needs to be invested in the education of Roma in Central Europe and the Balkans. Several times I took part in discussions on how to build better and more sustainable pension systems, and how to deliver better health and safety at the workplace, which is also in the interest of business.
A changing agenda, open to challenge
The last three years have seen the rise of inequality among the discussion topics of the WEF and similar fora. By now it is almost a common place to say that income inequality undermines both economic performance and social cohesion. In 2014 it was still a fresh topic, but already then The Economist reported that at one session in Davos 64% of the audience said wealth concentration was “corroding democracy”.
The question of course is whether the days of social and global responsibility really make an impact on everyday practices, and whether the intellectual platforms where business and political leaders converge really offer solutions to fundamental social and ecological problems. What some may consider radical or even revolutionary often turns out to be a cosmetic change on the face of global capitalism.
One of the keynote speakers of the 2014 Forum, David Cameron used his time to speak about re-industrialization (“re-shoring”). But when someone asked a question from the floor whether the Prime Minister would support a living wage for British workers, the answer was ambiguous. Cameron actually called the questioner “the lady in red”, but the lady should have been known to him, since it was Frances O’Grady, secretary general of the Trades Union Congress. In the same session, a centre-right member of the European Parliament from Sweden gave Cameron a lecture about the importance of the free movement of workers in the European Union, and the dangers of pandering to populist forces.
Another part of the extraordinary Davos experience is the early morning TV interview on the top of the congress centre. You are almost freezing, but you can see the sun rising from behind the snowy mountains.
Once I found myself at this vantage point next to Angel Gurria, Secretary General of the Organisation for Economic Co-operation and Development, discussing growth and jobs in Europe. It was the time when some of the EU countries, and especially the Southern periphery of the Eurozone, was sliding again into recession and youth unemployment was going to record high levels. You don’t have an hour for the interview, so you have to be brief and blunt. I said that in some EU countries jobs were more important than growth. Feel free to discuss.