Davos

The World Economic Forum, held at Davos, Switzerland, has for the past 38 years brought global leaders together to address economic problems and this year’s event is significant for the great turmoil in the global economy.

Harvard Business has blogged on it, and here is an excerpt from the first morning of the conference last week.

“The crisis the world is suffering through now is a failure of leadership. The leaders of the world are in Davos. If the world is watching what happens here this week, it will be to hear solutions and see responsibility and accountability. I'd say it's not off to a great start, at least on the latter.

“This morning, I started my Davos week with talk of trust. The Edelman Trust Barometer presentation revealed plummeting trust in financial, government, and journalistic institutions: 62% of adults in 20 countries trust companies less than they did a year ago. Trust in government is even lower.

“Nonetheless, the first trend I spot here: the rise of government. News reports have been saying that this will be a dialed-down Davos, but I don't see that; it's the same Davos with the same pastries and parties. The change I do sense is less of a presence and apparent swagger from business and more from government. "Power has shifted from Wall Street to Pennsylvania Avenue," said a speaker the Edelman event.

“The other obvious trend is America to the woodshed. "America is the new Europe," Richard Edelman said. In a decade of the survey, they have never seen such a precipitous drop in trust in one category: American business, falling from 58% to 38%in a year, now stands equivalent to France and Germany and under the UK. The least-trusted industries in the U.S.: no surprise -- automotive and banking.

“In most markets, trust in business remains higher than trust in government, "which is not a good thing for either," Edelman says. Asked who can fix the economy and prices, government is now clearly the preferred leader, the survey says. The percent who agree that government should impose "stricter regulations and greater control over business across all industry sectors:" 61% in the U.S. up to 84% in France (65% worldwide). The percent who trust business less: 62% worldwide, ranging from 77% in the U.S. down to 49% in India.

“The survey reveals a new world split: optimists in China (where trust in business rose from 54% to 71% in a year), Brazil, India, Indonesia, pessimists in the US, Europe. "The United States picture is really bleak. I can't put a better face on it," Edelman said.

“Edelman advised companies to make change and not wait for regulation, to recognize mutual social responsibility, and to show "shared sacrifice.... This is not the French Revolution yet but it is certainly not the roaring 2000s," he said.”