A GC's Take on the 2013 World Economic Forum in Davos
Three feet of snow line the streets of Davos. The cold is piercingminus 20 degrees centigrade. The security rivals the vault at Fort Knoxand with good reason. The constellation of political, business, and nonprofit leaders attending the 2013 World Economic Forum in Davos is unmatched anywhere in the world.
Government: Forty-five heads of state. Dmitry Medvedev. David Cameron. Angela Merkel. From the continent of Africa alone, more than a dozen presidents and prime ministers.
Business: Nine-hundred CEOs from every industry and corner of the globe. In aerospace, the CEOs of Airbus, Bombardier, Embraer, and EADS. From finance, the CEOs of Goldman Sachs, JPMorgan Chase, Morgan Stanley, and DeutscheBank, as well as Itau, Nedbank, Sberbank, and Standard Chartered.
Nonprofit and Other Leaders: The presidents of 20 leading universities, including Yale, Harvard, Oxford, Cambridge, National University of Singapore and Tsinghua. Eleven Nobel Prize winners. Two-hundred journalists, plus numerous religious leaders and artists.
Michael Phelps. Charlize Theron: You get the idea.
What do the delegates discuss during four days in Davos? First, there are the official WEF-sponsored events. In all, more than 250 "public" sessions and a comparable number of "private" sessions take place in the sprawling Congress Center and around Davos.
So many presidents and prime ministers came to Davos this year that the WEF decided not to hold a single, signature "plenary" session. Instead, there were multiple sessions with world leaders. If your interest was peace in the Middle East, then you could hear King Abdullah of Jordan, President Shimon Peres of Israel, the President of Lebanon, and the Prime Minister of the Palestinian Authority share their views.
Other topics ran the gamut. A popular session was "Women in Economic Decision Making," with panelists that included Christine Lagarde, the head of the International Monetary Fund; Sheryl Sandberg, the COO of Facebook; and Viviane Reding, the European Commissioner for Justice, Fundamental Rights, and Citizenship. Commissioner Reding forcefully argued that women should represent 40 percent of corporate board members in Europe by 2020. That certainly got the conversation going.
Then there was a "biopic" on Nelson Mandela. The movie producer, Anand Singh, described his 15-year journey to produce the authoritative portrayal of Mandela's epic life. A short segment of the film left the crowd mesmerized. The feature-length film will be released on Mandela's 95th birthday in July. The session was particularly evocative because it was in Davos in 1992 that South African President F.W. de Klerk and Mandela first appeared together outside of South Africaa milestone in the country's political transition.
While these presentations take place, CEOs conduct countless "bilateral" meetingstypically one-on-onewith their customers and suppliers. CEOs and other members of senior management teams will cram eight to 10 of these bilaterals into a single day in Davos.
The Evolving Role of General Counsel
An increasing number of general counsel and managing partners of law firms participate in the bilateral exchanges that take place at the WEF. This year's contingent included Brad Smith of Microsoft, Larry Thompson of Pepsi, Hilary Krane of Nike, and Ed Knight of NASDAQ, along with senior partners from Clifford Chance and Linklaters. (Indeed, Clifford Chance is the first law firm to become a strategic partner of the WEF.)
Two notes of particular significance for the legal community: First, corruption. The WEF launched a Partnering Against Corruption Initiative in Davos and called on both companies and governments to commit to real transparency. At a session with Prime Minister Medvedev, the audience was asked to rank the greatest risksand highest prioritiesfor Russia. Two thirds of those polled selected "transparency and anticorruption." Excessive dependence on oil, by contrast, hardly registered. Similarly, in a session entitled "De-Risking Africa," President of Nigeria Goodluck Ebele Jonathan and President of South Africa Jacob Zuma each asserted their case that corruption was under control.
Second, there was a subtle but noticeable change in the nature of the interactions between government officials and business leaders. In the four years following the financial crisis, governmentsand particularly regulatorswere appropriately ascendant. Business leaders, certainly those perceived as having contributed to the crisis, backpedaled. Executives dressed in sweaters and boots.
The mood in Davos seemed different this yearboth in substance and in style. Klaus Schwab, the President of the Forum, framed the theme for 2013 as "Resilient Dynamism." Yes, we need to create resilient institutions that can endure future shocks, but we also need to generate economic growth to reduce unemployment and income inequality. Governments openly wooed business leaders to invest in their countriesa message stated particularly effectively by Prime Minister Cameron and echoed by countless other government leaders. Moreover, with a handful of exceptions, regulators expressed an openness to engage in greater consultation and to defer effective dates of proposed liquidity and capital rules.
The half-dozen general counsel who attended this years Davos conference all work for companies that are expanding globally. Particularly for those GCs who are also responsible for managing Government Relations Departments, Davos represents an extraordinary opportunity to engage with senior government officialscentral bank governors, finance ministers, and trade ministerson issues like the terms of foreign direct investment, tax policy, and labor agreements. In the unique setting of Davos, relationships are forged that redound to our companies benefit over the long term.
Peter J. Beshar is the general counsel of the Marsh & McLennan Companies.