The World Economic Forum (WEF) Annual Meeting was getting underway. The Meeting customarily starts late on a Tuesday afternoon and ends on the following Sunday afternoon. This year, for the first time, I planned to take part from start to finish. On previous occasions, I could not spend as much time at the event as I wanted to because of scheduling conflicts,. But in 2012, I would be there for the full six days.
My Davos events started with a dinner hosted by the Wine Forum on Tuesday, January 25. It was a luxurious private event with Paul Pontallier, a legendary winemaker of Château Margaux. Prior to the dinner, I took no-mikata, an amino acid supplement designed to prevent hangovers. Maintaining a good physical condition is an essential part of participating in the Davos Meeting. Even very good wine could ruin your experience if it is taken in excess..
At the dinner, I was lucky to be seated across the table from Professor Josh Lerner of Harvard Business School. Sitting there was like receiving a free lecture from him for two straight hours. “US venture capital has failed to make inroads into China,” he noted. “Cleantech’s investment is irrecoverable. The Facebook IPO will generate super returns of more than 100 fold.” Professor Lerner discussed few topics that were entirely new to me, but what he said helped clarify the conditions venture capitalists were facing worldwide. He made the following comment, which I found intriguing: “In China, venture capital investments in the pure early stage have failed, but pre-IPO investments are succeeding. Every investor is now turning to look at later-stage projects.” I doubt if this situation is conductive to the healthy growth of venture capital industry.
Days at Davos start early and end late. After the Wine Forum event, I went back to my hotel at 11:30 p.m. The meet-up time for the next morning was 7 a.m. You start receiving invitations to private events after attending the Davos Meeting a few times. The Wine Forum dinner and the sessions scheduled for the next morning were typical of such gatherings. Private events are golden opportunities for expanding your network.
There are more WEF-sponsored private sessions than there are sessions printed in the official program. Besides those informal sessions, participants organize their own private gatherings. All of these sessions are basically free of charge. Participants could enjoy the very finest wines for no charge at the Wine Forum dinner thanks to Chevron Corporation, which sponsored the event. Session organizers exercise ingenuity to show their presence.
It was just after 6 a.m., and it was still dark outside. The Alps, which rise to the sky in daylight, seemed to particularly stand out with their silvery snow in the total darkness that enveloped them. The time in Japan was 2 p.m. I prepared to leave my hotel room after responding to emails.
This year I was staying at the hotel closest to the Congress Center. The location made it easy for me to move around. I thought I would also be able to walk to all the hotel venues because my hotel was located in the center of them. As I wrote in my columns last year, you can tell your relative position in Davos from your hotel allocation. I was able to book the hotel closest to the main venue this year. It felt like a promotion.
I always feel becoming an insider is crucial at international meetings like the Davos. The important thing is to attend as many gatherings as possible, make friends there, impress them, and give organizers cause to invite you again. Once home, you write thank-you notes, telling them about what you do, and send them emails as needed. Keep doing this and in time, Davos will become a place full of friends.
The sessions on the second day began. I participated as a speaker in a private session on the Trust Barometer survey conducted by Edelman, the largest independent public relations agency in the world. Private sessions are extremely serious affairs in Davos because companies and individuals pay money to sponsor them. They normally draw top-level participants, too.
Besides me, senior executives from companies such as ALCOA, eBay, Microsoft, and Deutsche Bank, along with the president of Yale University, were making presentations at this private session. I was the only speaker who had built a business from scratch, and also was the only one from Asia. The Edelman Trust Barometer study offers very interesting insights. Revealing pieces of data emerged in the session, such as the fact that ordinary employees are trusted more than business executives, and that government leaders are not trusted at all. I actively contributed with my opinions. My presentation seemed to have an impact on the audience. Many participants came up to me after the session to offer their feedbacks. In that connection, let me note here that GLOBIS is planning to hold a seminar on the same topic on Tuesday, February 7.
After the morning Edelman session was over, I walked from the hotel venue to the Congress Center, which is the main conference hall in Davos. At the Congress Center, I dropped by at a session where actor Ken Watanabe was a speaker, and then took a seat at another session on ”The Global Security Context”. Sensing that the discussions there were not really going anywhere, I went back to the session with Watanabe.
The participants at this session were half Japanese and half other nationalities. There were more people here than there were at the security session. There aren’t many Japanese who can draw a crowd of this size. I really hope that he will continue making a mark in the world.
Professor Hirotaka Takeuchi, who took the podium with Watanabe, wrapped up the session neatly with the following remark: “This session taught me about three Japanese words – kizuna (bonds), taru-wo shiru (enough is as good as a feast), and omoi (consideration).” One of the participants on the floor added that they also learned the meaning of ken (modesty), which is the same word as the actor’s name, and the importance of simplicity and modesty.
After the session with Watanabe, I networked for 45 minutes. I first spoke with an old friend of mine, a business manager from India, over tea for 30 minutes at a café counter in the venue. Then, I had a chat with a Swiss investor for the GLOBIS Capital Partners fund. Through the course of these conversations, I exchanged greetings with other friends who passed me by. Davos is a convenient place for these kinds of exchanges as influential leaders assemble here from around the world.
I next attended a session called “the Global Business Context”. I went to this session hoping to hear from top management people at large corporations. The CEO of ALCOA, who had been with me at the morning session, John Chambers, the CEO of Cisco Systems, and the CEO of NYSE Euronext were among the panelists there.
The current concerns of those CEOs are (1) the importance of transformations as opposed to changes and (2) how to adapt to technological evolution (including social networking service). Their strong sense of crisis left me a impression. What interested me most was the comment that providing good products and services will not suffice for future companies, as social contributions through CSR and other activities will become more central.
I looked through the European edition of the Wall Street Journal I had picked up at my hotel, and found a huge GLOBIS ad placement. The ad copy said, “The No.1 MBA Program in Japan, GLOBIS MBA,” together with my photo. The WSJ European edition is distributed free of charge at hotels around Davos, so people can find out about GLOBIS just by glancing through it. The ad was scheduled to appear in the WSJ for three days running from Wednesday to Friday. Our aim was to raise our profile as much as possible here in Davos.
I received an urgent short-notice request to lead discussions at a private dinner session on talent mobility scheduled for that evening. I wrote back to accept immediately. The request came to me probably because GLOBIS was featured as one of the cases in a report used at the dinner session. Facilitating discussions in English over dinner is a tough job, but I was determined to make the greatest contribution possible to the session.
The opening ceremony for the Davos Annual Meeting began. In Davos, an opening event takes place on the second day. A drum and bugle corps appeared in the center of the stage and started playing music. Networking without leaving your seat is common in Davos, which is another attractive aspect of this meeting. During the opening ceremony, I became acquainted with a person sitting diagonally behind me, a Tibetan Buddhism monk of French extraction who is a trusted aid of Dalai Lama. We were going to spend time together again at a dinner session on Friday.
WEF Founder and Executive Chairman Klaus Schwab and the Swiss President Eveline Widmer-Schlumpf replaced the drum and bugle corps on stage. Schwab declared the 42nd annual meeting open. I found his slow, German-tinted English very effective. “The Great Transformation: Shaping New Models” is the theme for this year’s meeting. “The most important resource in the world is no longer financial capital,” pointed out Schwab. “It is human resource with entrepreneurial spirit.”
The Swiss president followed Schwab with her own speech. The hall was full, with only room left for standees. While the audience listened to Widmer-Schlumpf, they were obviously waiting for the headliner, the German Chancellor Angela Merkel. Everyone was interested in what Merkel might say.
Scattered applause arose from the floor when the Swiss president left the stage. Then, it was time for the star speaker. Following Schwab’s introduction in German, Merkel took the stage and started speaking to the audience in German.
“World leaders have still to solve problems with global consequences, including the Doha Round and climate change. Even as the world population has increased from 2.5 billion people to 7 billion people, the size of the population has not grown significantly in Europe. (Notes: Up to this point, Merkel has yet to mention the word “Germany”, with the effect of underlining her position as the leader of Europe.)
“What is required of us now is a firm resolve to tackle the problem as Europeans, Budgetary discipline is also important. We must have awareness that we belong to the same community. As far as fiscal discipline is concerned, countries such as Portugal, Greece, and Spain do not have enough of it. (Notes: I think these words reflected Merkel’s self-perception as the President of Europe. She kept speaking in a strong language without referring to her notes, just as she had done last year.)
“In addition to fiscal reforms, we must also reform our labor market. A lot can be learned from best practices (such as those in Germany). We need frank discussions on what to do with our single market. We must think about whether our young generations will feel glad to be part of this market in the future.
“We made a commitment to observe fiscal discipline from the very start. There is no room for excuses any more. Europe will move towards more and deeper integration. Germany has a north-south imbalance, too. These imbalances derive from differences in the level of competitiveness. We must all be ambitious in addressing these problems.”
“What is essential is building prosperity for the Europe of future. Fiscal integration may be necessary, and there are other mounting issues that need to be dealt with. Germany promised to defend the Euro from the start., but we may not be able to keep this promise if the market attacks us. That’s why we must stay united.”
Merkel was beginning to look flushed. She continued her speech with forceful gestures, barely glancing at her notes.
“I know Europe has been labeled as the big headache in the global economy. But Europe is certainly not the only headache in the world. How should we keep world trade free? What about global climate change? We are discussing free trade agreements with partners such as Japan and South Korea at the moment.” (This was the first mention of Japan.)
The German Chancellor wrapped up her address wishing the Davos Meeting a success, then rested herself on a sofa, and started a dialogue with Schwab. “What is your vision of Europe?” – “What we are trying to do in Europe is something unprecedented. It’s totally different from the United States. We need to promote more freedom of movement and more integration in areas such as the pension system. Also essential is to strengthen the governmental functions of EU institutions.”
Merkel concluded her speech. It can be summed up in one word – “powerful”. I believe she tried to create an impression of strength more than she had needed to do last year. After Merkel’s appearance, an award ceremony for social entrepreneurs took place in the center of the stage. Then, Desmond Tutu engaged in a dialogue with Schwab. The audience shrank to less than half its earlier size at this point.
I returned to the hotel before night programs. First, I attended a reception hosted by the China Central Television (CCTV), where I found many friends. At the reception, I hugged a close Chinese friend of mine to celebrate our reunion. Then, I took part in the private dinner session on talent mobility. I think I managed to effectively play my role as a discussion leader. Finally, I showed up at a Wine Forum reception. I met people I had come to know the night before and made new friends there.
I could tell my circle of friends was expanding in a multi-tiered way. There were people who commended me for my Emails from Japan and others who complimented on my panel contributions. I usually drink with friends until the wee hours at conferences. But the Davos Forum just started, and I was scheduled to speak in more sessions to come. I was being rational this time, and returned to my hotel before midnight. I was quite proud of myself. I was going to have another busy day filled with things to do, including a board meeting in the morning. I decided to go to bed early. You need to stay sharp throughout the meeting period.
January 30, 2012
Yoshito Hori
Written on my flight back to Narita
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