My Top Ten Themes From 2010 Davos Part 2

The World Economic Forum has wrapped up and the small town of Davos is being returned to the skiers. I’ve developed my top ten themes from the five-day event. I posted themes 1 – 5 yesterday. Here are themes 6 – 10.

6. The world needs better governments.

Some governments in Central America and Africa are just holding on and many are dysfunctional.  But governability is becoming an issue for G20 countries as well.  One leader said the US is on the brink of being “ungovernable.”  One Chinese executive responded thusly when asked to defend his country’s lack of democracy:  “So we should adopt the American system where lobbyists run everything and nothing happens?”

Democracy was still seen as an unstoppable force but in many regions of the world it is becoming stalled, and in some cases losing ground.  Basic democratic institutions are at risk and in danger of failing part due to the economic crisis in poor countries.  The best predictor of democratic survival is per capita income.  In some countries portions of the government have been captured by interest groups. Other non-democratic countries are proving competitively stable and economically healthy.  And the current economic crisis shows that national governments and domestic regulation are inadequate to deal with the challenges of the global economy.   There is also danger of protectionism and isolationism.

7. It turns out the internet DOES change everything

The much-discredited phrase from the dotcom period is not just geek speak.  The Internet and Social Networks were central to many of the discussions here.  The digital age seems to be coming of age.  I participated with CEOs of most of the important social networks in a session called The Power of Social Networks. It got a lot of buzz at Davos.  A few minutes into it the session we solicited questions from Facebook.  6,000 questions appeared in first 2 minutes.

The growing consensus is that new business models are emerging in every industry and throughout society.  I’ve argued that social networking is becoming social production and that a new mode of production is emerging – changing not only how we make software or encyclopedias but physical goods like motorcycles.

Most leaders love that a web company – Google –  is taking on China. The circumstantial evidence that the China-based hacking of Google was conducted by authorities looking for information about activists was the straw that broke the camel’s back.  Talking to Google execs I’m convinced they not going to back down.

8. Girls, women and gender. A sea change is underway.

There was lots of buzz about women’s emerging purchasing power, known as the Power of the Purse.  The expected worldwide increase of women’s income by 2013 is $5.1 trillion, which is greater than China’s expected growth of $3 trillion for the same period.

Deep interest in the so-called Girl Effect, i.e., investing in girls offers the biggest ROI in the developing world.  In African countries female illiteracy is almost a third higher than that of men.  But every year of schooling increases a girl’s future earnings by 20 percent.  And by earning more and influencing how dollars are spent, women would acquire a stronger voice in all aspects of their lives.

Although women are becoming stronger financially, they are still very weak politically.  Countries should be more aggressive in finding female candidates for public office, and look outside the regular channels. But increased financial and political power brings responsibility. Woman could be key in refocusing our political and economic efforts away from consumerism.

9.  We need new measures of progress

There is growing agreement that GDPs and GNPs are flawed tools for measuring the health of country, and we should instead emphasize the idea of Gross National Well-Being or something similar.  Just as some companies have moved to “triple-bottom line” reporting for their impact on society, many economists argue that GDPs and GNPs measure activities that are detrimental to society and ignore activities that are beneficial.

A pandemic will increase drug sales and visits to doctors, thereby driving up GNP.  Volunteer work or work in the home is not recognized as contributing to GNP.

There is no lack of research and creativity on this issue, as some governments and academics have developed a wide array of yardsticks to more accurately capture how well and healthily a country is growing.  The key now is to have these new tools recognized as legitimate and encourage their widespread adoption.

10. A new big idea.  The Global Commons.

Like a park in a village we need new global parks in the global village. Some of the global commons areas are well-recognized, such as our atmosphere, oceans and space, but there are less obvious areas that exist, or should be created, such as know-how concerning sustainability

Conventional wisdom says you should control and protect proprietary resources and innovations – especially intellectual property – through patents, copyright and trademarks. If someone infringes your IP, summon the lawyers out to do battle.  That’s often the wrong approach.  Contributing to “the commons” is not altruism; it’s the best way to build vibrant business ecosystems that harness a shared foundation of technology and knowledge to accelerate growth and innovation.

A good private sector example is when more than a dozen pharmaceutical firms abandoned their proprietary R&D projects to support open collaborations such as the SNP (single nucleotide polymorphisms) Consortium and the Alliance for Cellular Signaling.  Both projects aggregate genetic information culled from biomedical research in publicly accessible databases. They also use their shared infrastructures to harness resources and insights from the for-profit and not-for-profit research worlds. These efforts are speeding the industry toward fundamental breakthroughs in molecular biology – breakthroughs that promise an era of personalized medicine and treatments for intractable disorders. Nobody gives up their potential patent rights over new end products, and by sharing some basic intellectual property the companies bring products to market more quickly.

One overarching theme at the conference is the confidence that young people have such great potential. Obviously we have a lot of work ahead of us if we don’t want to pass on a deeply damaged planet to our children.  At the final session at Davos, we heard from six inspiring young people on stage on their hopes and ambitions.  There were more than a few tears in the audience.

Don Tapscott

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Don Tapscott, one of the world's leading authorities on business strategy, is Chairman of Moxie Insight. He was founder and chairman of the international think tank New Paradigm before its acquisition 2007. Read more about Don.