Purpose and Sustainability Will Take Center Stage at WEF Annual Meeting in Davos This Year
A new year brings with it new approaches to the challenges facing the planet, so I’m excited to be attending the annual meeting of the World Economic Forum's Annual Meeting in Davos, Switzerland, this week, with our CEO, Kylie Wright-Ford. We’ll be representing The RepTrak Company and participating in conversations with some of the world’s biggest names in business and government.
Since 1971, the Forum’s Annual Meeting has been an opportunity for global business leaders to come together in the picturesque town of Davos with key players from politics, nonprofit organizations, and academia. Conversations cover a range of topics, but generally center around the role that business can play to serve all stakeholders—customers, employees, communities, and shareholders. In 1973, the “Davos Manifesto” put this purpose-driven mission in writing, and that document has shaped the Forum’s work ever since.
This year, even more so than in the past, it feels like the mission to serve the greater good is top of mind for companies. Many are now putting purpose at the heart of their efforts and focusing their attention on how what they do supports the challenges the world is facing.
Of course, purpose isn't exactly a new concept. But it’s a good thing that more companies are finally focused on it, because consumers are looking to companies to take a step forward in solving the challenges facing communities locally and globally, and they want companies—the ones they buy from and work for—to do more in this area, since governments in some influential countries appear to be taking a step back to deal with their own domestic issues.
One of those challenges is the worsening climate crisis, so it’s appropriate that the theme of the 2020 Annual Meeting is “Stakeholders for a Cohesive and Sustainable World.” And I’m pleased that the Forum will be backing up those words with action: The 2020 Annual Meeting will rely on locally-sourced food suppliers, introduce alternative sources of protein to reduce meat consumption, source 100% renewable electricity, reduce or eliminate materials like carpets that cannot easily be recycled or re-used, and introduce more electric vehicles. Its ambitious goal is to be among the most sustainable international summits ever held.
In addition, the Forum’s International Business Council will publish a universal “ESG scorecard”—bringing the Davos Manifesto into the next decade. This will put further emphasis on the world’s largest companies to be accountable, and to show measurable progress on how they’re living up to their Environmental, Social, and Governance goals and commitments.
As Professor Klaus Schwab, Founder and Executive Chairman of the World Economic Forum, said, “With the world at such a critical crossroads, this year we must develop a ‘Davos Manifesto 2020’ to reimagine the purpose and scorecards for companies and governments. It is what the World Economic Forum was founded for 50 years ago, and it is what we want to contribute to for the next 50 years.”
(In keeping with the sustainable theme, there’s been talk that Greta Thunberg, Climate and Environmental Activist and Time magazine’s 2019 Person of the Year, who is speaking at the conference, is expected to arrive on foot—trekking her way up the Alps rather than using public transportation.)
It's worth noting that the talk of sustainability is a bit like “old wine in new bottles,” as we say in Europe. After all, it’s not like corporate responsibility and integrating it with what you do as a business is a new thing. What was missing was tools and incentives that are now starting to be put in place to manage and drive behaviors. With those developments, I'm encouraged that more companies are coming around to this way of thinking, and taking a step forward in these areas.
For example, I was impressed by Microsoft’s vow in mid-January to be “carbon negative by 2030. If all goes according to plan, Microsoft will have eliminated as much carbon by 2050 as the company has generated since its founding 45 years ago.
In his annual letter to CEOs earlier this month, Black Rock Chairman and CEO Larry Fink talked about how "climate risk is investment risk" and announced a number of initiatives to place sustainability at the center of the company's investment approach, including: "making sustainability integral to portfolio construction and risk management; exiting investments that present a high sustainability-related risk, such as thermal coal producers; launching new investment products that screen fossil fuels; and strengthening our commitment to sustainability and transparency in our investment stewardship activities."
And last year, in my home country of Denmark, Grundfos A/S, the world’s largest water pump manufacturer in terms of value and volume, announced that it aspires to be “climate positive"by 2025. Mads Nipper, the company's CEO, has said that Grundfos strives to be the benchmark for other businesses.
These businesses (and others) show that it’s possible to make money while doing what’s right, and they intend to lead the way.
The future demands that business leaders move from a "shareholder capitalism" mindset to a "stakeholder capitalism" one, and take the expectations of every stakeholder into account, no matter what industry they belong to, where they’re located, or who they serve.
And so, as the Annual Meeting kicks off this week, it’s clear that purpose isn’t a fad or a trend, it’s a call to action—with more urgency behind it than ever before, and tools in place to make a measurable impact. The eyes of the world will be on Davos, as stakeholders look to see how companies and leaders in attendance will deal with pressing issues like climate change, and whether they will commit to changes that will win them consumer, investor, and policy-maker support—and save the planet in the process.
Where to find us in Davos
As I mentioned above, Kylie Wright-Ford and I will both be at the Annual Meeting in Davos this week. If you’ll be there, too, we’d love to see you.
I will be speaking at two sessions:
Tuesday, January 21 Ukraine House, Promenade 57
This is an exclusive, invite-only session for Ukraine House officials, sponsors, and VIPs, as well as Ukraine government officials, about trends in country reputation—particularly the rise in private stewardship in the absence of government leadership.
Wednesday, January 22 09:30–12:00 Brand Finance Global 500 2020 Launch TCS Dome, Promenade 80
C-Suite Panel: “Shareholders for a Sustainable World: Maximising Purpose & Profit”
Becky Frankiewicz, CEO, North America, Manpower Group
Adif Zulkifli, Executive Vice President & CEO, Upstream Business, PETRONAS
Stella Medlicott, CMO, Ericsson
Bernd Eitel, CCO & Brand Chief Officer, Lafarge Holcim
Kylie and I will also be attending multiple sessions and events throughout the week. If you’d like to meet with either of us, please get in touch!
After we return from Davos, Kylie and I will share some key takeaways through the lens of reputation, credibility-, and trust-building. Stay tuned for those actionable insights in the coming weeks.
Nicolas Georges Trad Co-Founder and COO The RepTrak Company firstname.lastname@example.org @TradNicolas