World Economic Forum - Annual Report 2001/2002

Annual Report 2001/2002

Solidarity in a challenging year

Following their discussions at the Annual Meeting 2002 in New York, US Treasury Secretary Paul O'Neill and rock star Bono visited Ethiopia as part of a joint tour of Africa. The tour marked a step forward for the continent. Since their return, the US government has put forward initiatives to address the AIDS epidemic and improve education in Africa.

The World Economic Forum is an independent international organization committed to improving the state of the world. The Forum provides a collaborative framework to address global issues, engaging world leaders – particularly its corporate members – in global citizenship.

Contents The president’s statement

2

The global agenda: Annual Meeting

4

The regional agenda

6

Task forces and initiatives

10

Our members and partners

16

Our communities and constituencies

18

Our people

22

Our organization

24

Our mission and strategic vision

31

Our values and principles

31

Our financial results

32

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The president’s statement

Solidarity in a challenging year

The World Economic Forum has achieved much in a difficult year. The attacks of 11 September, the financial downturn, international tension and a breakdown of trust in corporate governance all created a sense of global uncertainty. Against this disturbed backdrop our membership and internal team delivered in line with their key objectives. A clear example was the Annual Meeting held in New York in early 2002. Our team relocated the event from its traditional home in Davos, Switzerland in just 12 weeks. We are proud of this achievement and of being able to provide a platform for world leaders to show their solidarity with New Yorkers so soon after the attacks. This speed of relocation is emblematic of the drive and purpose of our people. Significantly, it increased understanding in the US of the World Economic Forum’s mission. In 2001/02 various outcomes showed that the World Economic Forum is succeeding in its aims of becoming an integrator of the best minds and a catalyst to creating innovative, challenging ideas. Here I highlight three specific examples of how the World Economic Forum served as a platform and – I believe – as a prompt for our members to deliver solutions to significant global issues: 1) Our Global Digital Divide Initiative, which is focused on bringing digital technology to the developing world, took significant steps. Following discussions at the Annual Meeting 2002, President Thabo Mbeki of South Africa was able to announce that Microsoft would supply free software to all 32,000 government schools in his country.

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2) Our Global Health Initiative Executive Statement was well received by corporations, governments and medical leaders alike. The health initiative is driven by a partnership between the World Economic Forum’s member companies, the World Health Organization and the Joint United Nations Programme on HIV/AIDS. Among the Executive Statement’s objectives is a 50% reduction in the disease burden of TB and malaria, and a 25% reduction in HIV by 2010. In addition the World Economic Forum assisted the Global Fund to Fight AIDS, TB and Malaria by advising them on how to engage the private sector. 3) Canada’s Prime Minister, Jean Chrétien, announced at the Annual Meeting the creation of a US$ 500 million fund by the G-8 for African countries committed to reform. This action followed the strong involvement of the World Economic Forum in the launch of the New Partnership for Africa’s Development (NEPAD). The World Economic Forum is well-placed to help its members meet the societal challenges ahead and to ensure that economic activities serve the global public interest. At this time, when trust in organizations of all types around the world is low, we are more committed than ever to transparency in our activities. In 2001/02 we reaffirmed the values and principles which guide us in several corporate documents.

Klaus Schwab

Our team is stronger than ever before. It increased in size from 147 people to 171, broadening the range of experience, cultural diversity and talent we offer. Our management team has also been strengthened. This will help us to both deliver on a day-to-day basis and to ensure that we have the necessary skills and expertise to focus and develop our strategic offering.

The strength of the balance sheet and management team and our organizational capability will be important in the months and years to come. As global leaders we all bear the responsibility for rebuilding trust in corporate and government institutions. It is in our own interests, and those of society, that we act together to find solutions.

After former President of Costa Rica José María Figueres joined us as a managing director in 2000, bringing vital governmental experience, we appointed a new director of communications. Michel Ogrizek, who previously fulfilled global communications remits at Unilever and UBS Warburg, started working with us in August 2002. He will help with the key challenge of communicating our mission in a globalized world. In addition, we strengthened our organizational capability, developing the new governance system and extending our IT resources.

The role of the World Economic Forum is permanently changing to be responsive to the challenges of our time. In 2001/02 the Forum continued its progression from being the convener of events, which uniquely engage all stakeholders in civil society, to becoming a leading strategic insight body. This progression will continue throughout the years to come. It is mine and my colleagues’ intention that the World Economic Forum will become the leading strategic insight organization in the world. As such the World Economic Forum will continue to support global leaders, from all sectors of society, by enabling them to identify the key issues and scenarios that face us all, and – most importantly – the actions that they must take together to improve the state of the world.

Our finances remain robust and we have continued to manage them prudently and effectively with a focus on future needs. In the year under report, our income increased by 13% to Sfr. 72,195,453. This allowed us to boost the amount spent on our high priority activities and on essential infrastructure by nearly 9% to Sfr. 69,077,008. The surplus has been added to Foundation Capital which now stands at Sfr. 12,114,753.

Klaus Schwab Founder and President of the World Economic Forum

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The global agenda

Participants in the Annual Meeting 2002

Annual Meeting 2002 in New York Rabbi Israel Meir Lau, Ashkenazi Chief Rabbi of Israel, and Cardinal Francis Arinze, President of the Pontifical Council for Inter-Religious Dialogue

The Annual Meeting 2002 brought together more than 2,700 leaders from business, government, academia, the media and civil society.

Rudolph W. Giuliani, former Mayor of New York, addresses the Annual Meeting 2002 of the World Economic Forum

Ratio of Annual Meeting Participants 2002 Other constituents Religious leaders NGOs Media Fellows

Business

Technology Pioneers Global Leaders for Tomorrow Academic experts

Public figures

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It convened for the first time in New York City as a symbolic act of solidarity with the city, after the attacks of 11 September. These tragic events brought home to all of us how fragile our world is. In line with this insight, we built the meeting around the theme of Leadership in Fragile Times: a Vision for a Shared Future. Sessions thus concentrated on six areas: advancing security and addressing vulnerability; re-evaluating leadership and governance; redefining business challenges; reducing poverty and improving equity; restoring sustained growth; and sharing values and respecting differences. The Annual Meeting achieved progress in many of these areas. In particular, it was significant in developing relationships between the constituencies from all walks of life that took part, 45% of whom came from outside the world of business. In particular, the 42 religious leaders who participated helped build a greater understanding of different values and cultures. In addition, there was a significant Arab presence. Forty young Arab leaders were integrated into the full Annual Meeting and we saw the highest ever participation of Saudi Arabians at a World Economic Forum event. This strong Arab presence helped participants to better grasp the complex relationship between Islam and the West.

Tore Godal, executive secretary of GAVI Secretariat, Switzerland, and Pascal Mocumbi, Prime Minister of Mozambique

Shimon Peres, Minister of Foreign Affairs and Deputy Prime Minister of Israel, and Hillary Rodham Clinton, Senator from New York

There was a major focus on interactivity, with workshops and interview-style panel discussions on crucial global, regional and industry issues. As such, the Annual Meeting was not a meeting in the traditional sense, but more the flagship for the World Economic Forum’s larger set of activities, including regional knowledge meetings and initiatives.

• The creation of a Disaster Response Network, leveraging the resources of businesses in engineering and transportation to assist with disaster relief efforts

The Annual Meeting, in common with all World Economic Forum activities, aimed to identify tangible solutions to the most urgent challenges facing the world today. The outcomes delivered included: • The signing of a Global Corporate Citizenship statement by 36 CEOs, representing companies from various industry sectors and geographical regions. The statement recommends a framework for action to manage the impact of business on society and to strengthen relationships with stakeholders around the globe

“By holding their 2002 Annual Meeting in New York, the World Economic Forum served as a resounding endorsement of New York City's sustained vitality. We can't think of a more appropriate, courageous and optimistic milieu for the Davos Meeting to be held than in the most diverse city in the world, which also happens to be the financial capital of, and a global economic partner, to the world. This is a tremendous vote of confidence in our city. It sends a message that New York is back in business, and that New York is the place to be for world leaders and decision-makers.”

• The announcement of a contribution of US$ 50 million by the Gates Family Foundation for AIDS prevention in Africa. This sum included a US$ 20 million donation to the trial of a promising microbicide that could potentially help protect women from HIV/AIDS

Rudolph W. Giuliani, former Mayor of New York, Annual Meeting 2002

• A declaration by Canada’s Prime Minister Jean Chrétien that the G-8 group of nations is creating a US$ 500 million fund to help African countries committed to reform. The fund will assist African governments to build a durable peace, address their health crises, strengthen democracy and open potential for trade and investment For more information about the Annual Meeting 2002 visit www.weforum.org/annualmeeting www.weforum.org 5

Gloria Macapagal Arroyo, President of the Philippines, at the World Economic Forum's East Asia Economic Summit 2001, held in the Hong Kong Special Administrative Region.

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The regional agenda

Addressing crucial local issues

Our regional agenda focuses on high priority issues relevant to local members operating in different regions. In 2001/02, the World Economic Forum brought together thousands of decision-makers to address the most crucial regional issues of today. Asia Pacific and China China continued to develop its economic base during the course of 2001/02. However, difficulties remained in the Japanese economy and throughout the region there was an over-reliance on the US and other western markets. The World Economic Forum recognized the need to ensure the entire region benefited from China’s growing strength. It was uniquely positioned to bring together 600 leaders to address issues surrounding market development at the China Business Summit 2002 in Beijing. (For more information visit www.weforum.org/china) The World Economic Forum also acted to maintain the momentum in the Chinese economy with the launch of the New Chinese Economic Leaders programme. It will support a new generation of Chinese leaders from all walks of life as they confront the social and economic challenges ahead.

Taking a long-term view of Japanese recovery, in the closing weeks of the financial year, the World Economic Forum began to develop its ‘blueprint for Japan’. Young Japanese leaders from the business, government and academic arenas were asked to identify and define how to surmount the country’s ten biggest challenges in the years up to 2020. Their plan will be delivered to the Annual Meeting 2003 in Davos. At the India Economic Summit a council of chief executives from both India and abroad was created. The India Advisory Council will advise the World Economic Forum on strategies for building confidence, increasing investment and delivering prosperity in the subcontinent. (See www.weforum.org/india)

“It is not the case that most people wish to reverse globalization. It is that they aspire to a different and better kind than we have today.” Kofi Annan, Secretary-General, United Nations, Annual Meeting 2002

The World Economic Forum again brought leaders together to discuss regional issues at the East Asia Economic Summit in Hong Kong in October 2001. Although advances were made, discussion at the event was inevitably dominated by the impact of the terrorist attacks of 11 September in New York and Washington. (For more details see www.weforum.org/eastasia)

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The regional agenda Africa and the Middle East In Africa, the World Economic Forum was instrumental in winning business trust in the New Partnership for Africa’s Development (NEPAD). The partnership aims to eradicate poverty and achieve sustainable growth but, as business felt it had not been consulted about its creation by African governments, it was largely sceptical about its prospects for success. The World Economic Forum provided a platform for the region’s leaders to overcome this scepticism and win private sector support, both at the Annual Meeting in New York and at the Africa Economic Summit in Durban, South Africa. More than 200 African and multinational companies signed a declaration committing their businesses to supporting the NEPAD. (For more information see www.weforum.org/africa)

“There is no way that Africa can benefit from globalization without industrialization. Can globalization deliver?…Only if there is cooperation between North and South and rich and poor.” Benjamin William Mkapa, President of Tanzania, Annual Meeting 2002

In the Middle East, economic stability was threatened by tensions with Israel. The World Economic Forum’s Annual Meeting 2002 provided an opportunity for Israeli and Palestinian business leaders to hold private meetings. They made a joint statement pledging to seek closer relations. The statement was co-delivered by Dan Gillerman, the Israeli ambassador to the United Nations, and Walid Najjab, a board member of the Palestinian Electricity Company. Following this statement, as a gesture of goodwill, Israeli business played an important role in persuading its country’s customs authority to release a shipment belonging to Palestine Cellular Communications Limited. In the Arab world, promising young leaders have often found it difficult to come to the forefront on the international stage. At the Annual Meeting 2002, the Young Arab Leaders community was launched. The aim of the initiative is to identify young people from the Arab world that are poised to assume key positions in areas such as business, academia and politics.

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North America In North America, the war on terror and corporate accounting scandals exacerbated an already sluggish economy. Despite this, the World Economic Forum helped to inspire new moves by the US government to relieve the plight of some of the world’s poorest people. The World Economic Forum’s unique role in bringing people together from different walks of life was highlighted when Irish rock star Bono met US Treasury Secretary Paul O’Neill at the Annual Meeting in New York. There, they discussed the possibility of writing off debts incurred by some of the world’s poorest countries. Following this meeting Bono and O’Neill went on a tour of Africa, including Ghana, Uganda, South Africa and Ethiopia, where they met doctors, farmers, teachers, students and entrepreneurs. The tour marked a step forward for the continent. Since their return, the US administration has put forward initiatives designed to address the AIDS epidemic and the continent’s weak education infrastructure, which has suffered neglect in countries crippled by debt. In May, leaders from around the world discussed prospects for the American economy at the USA Meeting 2002 in Washington. Following 11 September, they also focused on likely scenarios around the economic and social impacts of terrorism. (See www.weforum.org/usa) Latin America Economic turmoil in Latin America, particularly in Argentina, continued to hinder growth and social equality. In response, the World Economic Forum sought to harness the private sector behind economic and social reforms as a step to future growth. The Annual Meeting 2002 provided an opportunity for political and business leaders to discuss ways of solving the crisis in Argentina. They focused on political institutions, competitiveness, foreign trade and financial systems. Working with the new Argentinian government they made key recommendations for change. Latin American business leaders held a followup meeting in Washington to further address the main issues affecting the region.

Europe In Europe, there were signs of increasing scepticism about European integration and the perceived gulf between the European Union’s institutions and its citizens. To help address this discontent and look forward to the future, the World Economic Forum launched with Monday Morning the Bridging Europe initiative. This was a catalyst for online dialogue between 1,000 younger Europeans and some of the EU’s key politicians and business leaders. (For further information visit www.weforum.org/europe) Russia and Central Asia Central Asia, politically and economically significant as the holder of important oil resources, remained

a volatile and unpredictable region. It became viewed by some authorities as a possible breeding ground for extremists. At the Eurasia Economic Summit 2002 in Almaty, Kazakhstan, 500 business people, politicians, academics and media representatives from across the region were brought together to discuss how to ‘sustain growth in uncertain times.’ (For more information visit www.weforum.org/eurasia) As poor corporate governance practices continue to dog the Russian economy, the World Economic Forum drafted a corporate code of conduct designed specifically for the local environment. The issue was progressed at both the Russia Meeting in Moscow 2001 and at the Annual Meeting 2002.

Bridging Europe The Bridging Europe initiative demonstrated the World Economic Forum’s commitment to building communities of current and future leaders who share our mission. The initiative was designed to tackle political indifference and the perceived gulf between the European Union’s institutions and its citizens. It united 1,000 young people, from 33 countries, in an online dialogue with leaders from European politics, business, non-governmental organizations and academia. The initiative was run in partnership with the Danish think-tank Monday Morning. Following the nine-week dialogue, the young people travelled to Denmark for the Youth 2002 meeting. At this event, they presented a draft proposal for a new European constitution to Danish Prime Minister Anders Fogh Rasmussen and Valéry Giscard d’Estaing, President of the Convention on the Future of Europe. British youth delegate Zoë Waterman said: “The two weeks in Denmark were a huge learning experience for all involved, as well as a lot of fun and the foundation of many firm friendships. For

me, the most eye-opening aspect of the event was the participation of those countries who are currently applying to join the EU. They made me realize how western my views are and forced me to re-evaluate them.” Giampiero Alhadeff, Secretary-General of Solidar, an international alliance of NGOs, said: Young people discuss the way to a better Europe, “There is much talk of a as part of the Bridging Europe initiative democratic deficit separating the European Union from its citizens. The unsurprising thing about the 1,000 young people involved in this project is how committed they are to a Europe that is dedicated to human rights, tolerance and social inclusiveness. For them, there is no contradiction between an economically strong Europe and one that stands up for social justice at home and abroad.” (For more information about Bridging Europe see www.weforum.org/bridgingeurope) www.weforum.org 9

The Global Health Initiative is fostering greater private sector engagement in the fight against HIV/AIDS, TB and malaria. It is driven by a partnership of the World Economic Forum, WHO and UNAIDS.

Photo credit: UNAIDS/G. Pirozzi

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Task forces and initiatives

Furthering our mission

The World Economic Forum’s global, multi-sector membership provides a unique platform for the discussion, coordination and development of practical projects dedicated to improving the state of the world. The World Economic Forum has established a number of task forces whose initiatives form an integral part of this mission. (See www.weforum.org/initiatives) Global Competitiveness Programme The World Economic Forum’s Global Competitiveness Programme expanded during 2001/02, with the introduction of workshops to complement its expert reports. The Global Competitiveness Programme aims to act as a catalyst for economic policy change, by assisting governments in identifying impediments to growth and in designing strategies to achieve sustained economic progress. One recent collaboration has been with Colombia, whose economic reform programme is based on the World Economic Forum's competitiveness approach. The programme also serves as an integrator between members and key policy-makers, contributing to the creation of an economic framework that supports private investment, entrepreneurship and social progress. Its other objectives include stimulating public debate on economic development and global stewardship, and helping investors develop business strategy by monitoring and benchmarking national economies.

In 2001/2002, the programme produced the following reports: • The Global Information Technology Report 2001-2002: Readiness for the Networked World • The European Competitiveness and Transition Report 2001-2002 • Environmental Performance Measurement: The Global Report 2001-2002 • The Latin American Competitiveness Report 2001-2002

“The gap in health outcomes is growing dramatically… AIDS and TB are really phenomena of the poor world: when I say poor world, of course, I mean the majority of the world.” Bill Gates, Chairman and Chief Software Architect, Microsoft Corporation, Annual Meeting 2002

In addition, the World Economic Forum held a range of regional and global workshops where leaders met to discuss issues critical to national competitiveness. These workshops were supported by presentations around the world to national governments keen to strengthen their economies. (For further information see www.weforum.org/gcp)

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Task forces and initiatives Environmental Sustainability Index The Environmental Sustainability Index is a measure of overall progress towards environmental sustainability.

The digital divide is about more than just direct access to technology. It also concerns a nation’s computer literacy and how effectively different countries use IT for social and economic development.

The index was first developed in 2000 by the World Economic Forum’s Global Leaders for Tomorrow Environment Task Force, the Yale Center for Environmental Law and Policy, and the Columbia University Center for International Earth Science Information Network.

At the Annual Meeting 2002 in New York, the initiative task force launched a CEO Charter for Digital Development. CEO signatories agreed to try to target at least 20% of their annual corporate citizenship and/or philanthropy budgets towards concrete and sustainable actions to promote social, economic and educational progress in developing countries and disadvantaged communities, through information and communication technologies.

It takes account of both a country’s existing environmental capabilities and performance and its future capacity to manage environmental challenges. The index offers a benchmark for national environmental comparison and provides the critical information required for environmental decision-making.

“Today, if you try to ‘greenwash’ as a multinational corporation, you will wake up sorry one morning.” Björn Stigson, President, World Business Council for Sustainable

Initial signatories included participants from Taiwan, Egypt, the US, Jordan, the Philippines, South Africa, Malaysia, the United Arab Emirates, the Russian Federation, Switzerland, Spain and France. In 2001/02, the task force carried out an international survey and evaluation of digital divide-related projects. It also forged partnerships between digital divide teams and the wider World Economic Forum, to share knowledge about successful projects.

Development, Annual Meeting 2002

This year, the index’s scope was broadened. An increase in the number of ranked countries from 122 to 142 made it more comprehensive; the crucial measure of greenhouse gas emissions was emphasized, and measuring techniques were improved with the introduction of new data sets and advanced data importing methods. A pilot Environmental Performance Index was also launched. This ranks countries more precisely by using specific environmental criteria and by indicating improvement rates. In the 2002 index, Finland was ranked first for environmental sustainability. This followed its success in minimizing air and water pollution, its management of environmental problems and its low levels of greenhouse gas emissions. (For further information visit www.weforum.org/esi) Global Digital Divide Initiative The Global Digital Divide Initiative builds partnerships between the public and private sectors to help less developed countries make use of information and communication technology (ICT).

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This activity helped match companies seeking to invest in education-related activities with projects requiring support. During 2001, World Economic Forum strategic partnerships helped the following projects to improve their education-related activities: the Committee for Democracy in Information (Brazil), Educar Chile (Chile), ITrain (Canada), and US-based Schools Online, World Computer Exchange and World Links. There were several other key outcomes. For instance, a joint Southern African Development Community/World Economic Forum workshop helped to share perspectives on e-readiness. In another example, in regional pilot studies in South Africa and Brazil, local teaching bodies and government groups worked with global IT companies to develop IT education. The initiative began in 2000 with a one-year mandate but was so successful that its remit was expanded. The task force will now be refocused at the Annual Meeting 2003 to assess the social investment required to ensure its continuing success. (For further information visit www.weforum.org/digitaldivide)

Global Health Initiative The Global Health Initiative is designed to foster greater private sector engagement in the global battle against HIV/AIDS, tuberculosis (TB) and malaria. These diseases are regarded as the root causes for the failure of developing countries to increase their economic and social well-being. The initiative is driven by a partnership between the World Economic Forum's member companies, the World Health Organization and the Joint United Nations Programme on HIV/AIDS (UNAIDS). It has four major strategies: • Promoting the business case to unite global industry in the fight against HIV/AIDS, TB and malaria • Developing resources to promote good practice within workforces and communities • Identifying resource gaps and corresponding partnership/philanthropic opportunities • Expanding corporate advocacy

As a result of these aims, many companies have strengthened their internal policies and programmes, offering anti-AIDS drugs to workers and their families. This potentially doubles the number of people in Africa with access to life-saving medicines. (See www.weforum.org/globalhealth) Encouraging progress has been made during 2001/02, including: • The production of the initiative’s executive statement. This corporate call to action was signed by 30 companies and was accompanied by a resource paper comprising the findings and tools developed in 2001 • The World Economic Forum’s participation as a private sector representative on the Transitional Working Group, the design and development body of the Global Fund to Fight AIDS, TB and Malaria. The initiative is now the focal point for private sector interaction with the Global Fund

Global Digital Divide Initiative The Jordanian Government intends to introduce information technology as an important component of both primary and secondary education. To achieve this it wishes to equip 3,183 schools with computer laboratories. The World Economic Forum is supporting this programme through its Global Digital Divide Initiative. Although Jordan has been successful in securing loans for the project, it still needs to equip more than 1,000 schools and provide basic computer literacy training for almost 57,000 teachers. The World Economic Forum is working with the independent, non-profit organization World Links and private sector partners to provide computer equipment and software for 500 Jordanian schools. World Economic Forum members are also supplying financial resources for teacher training.

This project is an essential part of the Jordanian Government’s long-term goal of becoming a global hub of information technology. Bridging the gap between those who have information and communications technology and those who have not is an important goal of the World Economic Forum. This technology can enable a better life for millions by enabling countries to overcome barriers to development.

Bridging the digital divide

The Global Digital Divide Initiative is bringing technology to people across the developing world, including Brazil, Ghana, Mexico, South Africa and Vietnam. www.weforum.org 13

Task forces and initiatives Global Agenda Atelier The World Economic Forum launched the Global Agenda Atelier at its Annual Meeting 2002. The programme aims to help members systematically anticipate and assess risks or opportunities emerging from political, social and economic trends.

Increased life expectancy, the impending retirement of the baby boom generation and a falling retirement age are creating unsustainable pressures on public and private pension systems. Although this is a global problem, many countries are approaching the issues of ageing and pension reform in an isolated manner.

The programme focuses on global themes such as re-evaluating leadership, reducing poverty and sharing values. It draws on the insight of global leaders to develop an overall understanding of the issues and possible solutions. (For more details see www.weforum.org/atelier)

The task force aims to create a cross-country comparison of policy performance together with a broader discussion about the effect the changes could have on the world economy.

“If an organization perceives that the CEO and top

The initiative will bring together leaders from the financial services and employment industries and other stakeholders, such as senior citizen groups, labour unions and international organizations.

management are tweaking things in the company for their own comfort...I guarantee you that it will roll downhill like a big snowball and everyone will tweak things for their own comfort.” Roger Enrico, Chairman and CEO, PepsiCo, Annual Meeting 2002

Agricultural Trade Task Force The task force was established in 2001 to drive forward equitable reform of global agricultural trade, making a substantial contribution to the alleviation of poverty in the developing world. During the World Economic Forum's Annual Meeting 2002, the task force of companies and anti-poverty NGOs issued Recommendations for Action on Trade. This included key guidelines for equitable reform of the global agricultural trade system. It also advocated a move towards a more open and fair trade system through the removal of market-distorting export subsidies, export credits, direct payments and market access restrictions. (For further information visit www.weforum.org/agriculturaltrade) Pension System Readiness Initiative The Pension System Readiness Initiative aims to assess the retirement system readiness of member countries of the Organization for Economic Cooperation and Development.

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Global Governance Initiative The World Economic Forum’s Global Governance Initiative assesses the efforts of governments, intergovernmental organizations, and non-state bodies to address global problems such as poverty, disease and armed conflict. Its aim is to bring the international community to greater accountability to the Millennium Summit Declaration’s goals, in particular, on how much effort and cooperation has been given. The initiative, which was conceived in 2001, will produce regular reports that rate these organizations on their effort and willingness to engage in partnerships. These will be used to help stimulate the interest of the media and policymakers and to put pressure on governments to take action and fulfil their promises. The Global Corporate Citizenship Initiative The World Economic Forum believes that business should be fully recognized as a key part of society and must act proactively in the global public interest. Business is now increasingly realizing that it has a raison d’être in society that extends beyond behaving responsibly. More and more, companies are accepting that they must address the global issues of our time if they are to remain successful and sustainable. In July 2001, the World Economic Forum launched the Global Corporate Citizenship Initiative: in 2001/02, it continued to act as a catalyst for corporate citizenship.

The Global Corporate Citizenship Initiative aims to help business leaders develop systems to integrate corporate citizenship principles into their business strategies. The 30-plus inaugural member companies came from a diverse range of industries and regions and included UBS AG, The Coca-Cola Company, McDonald’s Corporation and Phillips-Van Heusen Corporation.

The statement includes a practical template for leadership, which can be used by CEOs and board members to translate these principles into practice within their organizations. In drawing up the statement, members were assisted by academics and procorporate citizenship organizations, with the Prince of Wales International Business Leaders Forum playing a significant role.

At the Annual Meeting 2002, the initiative’s members launched a landmark statement: ‘Global Corporate Citizenship: the Leadership Challenge for CEOs and Boards’. This emphasizes that corporate citizenship is first and foremost about the way companies run their businesses. Moving beyond philanthropy, responsible business principles must be integrated into core business principles and practices.

The urgent need for global corporate citizenship was also promoted at the World Economic Forum’s regional economic summits in Europe and Africa. (See www.weforum.org/corporatecitizenship)

Disaster Response Network Earthquakes, famine and other major disasters bring misery to many thousands of people every year. In many situations, humanitarian tragedies are made worse by the fact that aid donated by business, charities and the public cannot get through to those who need it most. The World Economic Forum’s Disaster Response Network was launched to make it easier for companies to channel aid and expert help to stricken communities in the early response phase of emergencies. It also ensures that corporate donations are delivered in a coordinated and effective manner to humanitarian organizations.

The network was established at the World Economic Forum’s Annual Meeting 2002 in New York, after the Gujarat earthquake in India. A financial strategy was developed, with member companies committing to contribute over US$ 100,000 to the launch. The initial aims are to develop a circle of regional business leaders who are willing to take action when disaster strikes, and to create a clearing house to ensure engineering and transportation company experts reach particular areas of need. Its main goals are to develop regional groups in Mexico and India, providing staff training and creating a knowledge centre for organizations involved in disaster relief. The project is also working to overcome legal, contractual and regulatory hurdles that slow the progress of relief operations and to ensure training is available for member company employees willing to volunteer to help after a disaster. (For further information visit www.weforum.org/drn)

The aftermath of the Gujarat earthquake, which prompted the launch of the Disaster Response Network

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The World Economic Forum's Global Competitiveness Report 2001 ranked the comparative strengths and weaknesses of 75 national economies. It found that Finland had the most competitive economy.

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Our members and partners

A businesscentred forum

The World Economic Forum is a business-centred organization, which acts as an interface with all stakeholders in civil society at large. Our members and partners represent all sectors and regions of the global community. The World Economic Forum does not make public or private statements in the name of its members. Members The World Economic Forum’s membership is primarily drawn from the world’s 1,000 leading global companies. However, 35% of the membership is reserved for companies from developing countries and those which are corporate or technological trendsetters. Membership criteria are strict and forward-looking to ensure that the businesses chosen are representative of the evolving global economy and committed to the mission of the World Economic Forum. Our members represent the top companies within their industry and/or country; play a leading role in shaping the future of their industry and/or region; engage in activities with a global dimension; and enjoy a healthy growth and reputation. During 2001/02 the following companies were accepted as members of the World Economic Forum: Akamai Technologies, Alticor Inc., American Express Company, AstraZeneca Plc, Avaya Inc., Aviva Plc, Azizler Holding AS, Banca Nazionale del Lavoro SpA (BNL), BEA Systems Inc., Becton Dickinson and Company, Böhringer Ingelheim GmbH, Bristol-Myers Squibb Company, Cathay Pacific Airways Ltd,

Centerpulse Ltd, Central Japan Railway Company, China Hainan Airlines Co. Ltd, Clifford Chance, Club Méditerranée, Commerce One Inc., Dassault Falcon Jet Corp., Depository, Trust & Clearing Corporation (DTCC), Diageo Plc, Dogus Holding AS, Dongwon Securities Co. Ltd, Economic Development Board, EMI Group Plc, eSpeed Inc., Federal-Mogul Corporation, Fedex Corporation, Ferrovie Dello Stato SpA, Finmeccanica SpA, Flextronics International, Google Inc., Government of Andhra Pradesh, Grey Global Group Inc., Groove Networks Inc., Grupo P.I. Mabe SA de CV, Gulf International Bank BSC (GIB), Home Box Office, Human Genome Sciences Inc., IBS Group, ING Group, Interpublic Group of Companies Inc., Intertex Holding GmbH, Intier Automotive Inc, IPP Limited, J.D. Power and Associates, Jet Airways (India) Pvt Limited, KTB Network, Kuala Lumpur Stock Exchange (KLSE), MIH Group, Moody's Corporation, Mori Building Company Limited, Murugappa Group, National Bank of Dubai PJSC, National Investment Council, Novolipetsk Metallurgical Combine (NLMK), NTL Inc., Omnicom Group Inc., Oxygen Media Inc., Palm Inc., Panama Canal Authority, Pequot Capital Management, Inc., Peregrine Systems Inc., PKN Orlen SA, Ports Customs & Free Zone Corporation, Random House, Reader's Digest Association Inc., Ripplewood Holdings LLC, RVC-The Greenhouse Fund, RWE AG, Saudi Arabian General Investment Authority, Seiyo Food Systems, SK Telecom Co., Sonangol E.P., Superfos, Sybase Inc., Synopsys Inc., TDC A/S, Thomas Cook AG, Timken Company, TSX Group, Vattenfall, VIA Technologies Inc., Viking Global Investors LP, Vulcan Inc. and Zenith International Bank Ltd.

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The business co-chairmen of the Annual Meeting 2002, clockwise, from top left: Raymond V. Gilmartin, Chairman, President and CEO, Merck and Co., Niall Fitzgerald, Chairman, Unilever; Yotaro Kobayashi, Chairman, Keizai Doyukai, Japan; Roberto Civita, Chairman and CEO, The Abril Group

Partners Strategic Partners are select member companies who strongly support the World Economic Forum's commitment to improving the state of the world. They are actively involved in the World Economic Forum’s endeavours at global, regional and industry levels. They contribute their expertise and resources at the highest level in order to advance worldwide economic and social progress.

“A knowledge-based economy without an open society is impossible…You need the creativity of free people –

Membership Development Our members are at the heart of the World Economic Forum and include 1,000 of the world's foremost companies. Members encompass not only the most global companies in the world, but also regional market leaders and smaller companies shaping the future of their industries. The selection criteria for inclusion are quite strict. Over the past year the World Economic Forum has not only welcomed almost 100 new companies into the organization but has also declined to renew membership for a number of companies who no longer meet the requisite criteria.

citizens – to run the heart of a productive knowledgebased economy.” Joschka Fischer, German Federal Vice-Chancellor and Minister of Foreign Affairs, Annual Meeting 2002

As of 30 June 2002, our strategic partners were: ABB, Accel Partners, Accenture, A.T. Kearney, Audi, Barco, The Boeing Company, Booz Allen Hamilton, BP, Cisco Systems, The Coca-Cola Company, Compaq, Deloitte Touche Tohmatsu, DHL Worldwide Express, Ernst & Young, General Atlantic Partners, Goldman Sachs, J. & W. Seligman & Co., IBM Corporation, KPMG, Kudelski Group, McKinsey, Merck & Co. Inc., Merrill Lynch, Microsoft Corp., Nestlé, Pfizer, PricewaterhouseCoopers, Reuters, Siemens, Suez, Sun Microsystems, UBS, Vivendi Universal and Volkswagen.

18

We are proud to report that, despite economic pressures from a difficult global economy, the World Economic Forum has maintained its number of active members, which underlines its ability to meet their needs and address issues of concern.

Our communities and constituencies

Engaging leaders

Communities A key part of World Economic Forum activity is the creation of distinctive communities of member and partner companies, creating smaller, more informal opportunities for interaction. The International Business Council The International Business Council (IBC) was established by the Foundation Board in 2001/02 to replace the Council of the World Economic Forum.

Industry Governors Another significant community is the World Economic Forum's Industry Governors. These are a group of CEOs selected from influential companies within each of our designated industry groupings. They engage with the World Economic Forum to identify, discuss and address issues of primary importance to their sectors and provide intellectual stewardship to the Forum's efforts, such as industry-specific initiatives and task forces and industry-targeted sessions in meetings and events.

The IBC is an interactive community of concerned and committed business leaders made up of 100 highly respected and influential chief executives. It identifies and addresses globally relevant business issues and develops practical solutions. It also acts as an advisory body providing intellectual stewardship to the World Economic Forum.

“We may come from different countries but, at this

The IBC meets twice a year. It followed its inaugural meeting, at the February Annual Meeting 2002 in New York, with an August meeting in Geneva.

Each year, during the last two days of the Annual Meeting in Davos, each of these groups assemble for a private, off-the-record discussion to address non-competitive issues of mutual importance and interest. Many of the World Economic Forum's most impactful initiatives, including the Global Digital Divide Initiative and the Disaster Relief Network, stemmed directly from these discussions.

IBC members are nominated by a membership committee, based on clear criteria and guidelines, with selection based on the qualities of the individuals and their companies. Council membership is limited to two three-year teams, other than in very exceptional cases when it is extended to three three-year terms.

moment in the world economy, we all speak the same language: the language of change.” Vicente Fox, President of Mexico, Annual Meeting 2002

www.weforum.org 19

Our communities and constituencies

A World Economic Forum director (far right), with two Global Leaders for Tomorrow

Constituencies To complement the knowledge of members and partners, the World Economic Forum engages a wide range of individuals and organizations from all sectors of society, whom it includes in its activities as constituents. Advisory Groups In 2001/02, we created advisory groups to enable other key stakeholders of the global economy to engage in and help shape the World Economic Forum's activities. The labour union, nongovernmental organization, academic and religious leaders’ groups involved are made up of leading figures from these segments of global society. They provide advice and input into the development of the World Economic Forum's meetings, communities and initiatives.

“Financial ratings have become kind of second nature in the business world. We must further explore the idea of social and environment ratings.” François Roussely, President and CEO, Electricité de France

These consultative arrangements are a vital part of the World Economic Forum's commitment to providing a non-partisan, multistakeholder platform for dialogue and partnership. In addition, to maximize the relevance of meetings and initiatives for policymakers, we consult extensively with leaders from international organizations and governments.

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Forum Fellows The World Economic Forum relies upon a continuously evolving group of about 300 experts and scientists from all fields of knowledge. These people are at the cutting edge of their disciplines and are considered as leaders by their peers. We collaborate closely with this faculty group to design the programmes of our summits and meetings, as well as to develop the various initiatives and task forces we undertake with our members and partners. Global Leaders for Tomorrow The Global Leaders for Tomorrow (GLT) community represents the new generation of leaders. The GLTs are young but proven leaders from business, politics, the arts, the media and civil society with a demonstrated commitment to addressing issues beyond their immediate professional interest. The third annual GLT Summit, held in Geneva in the late summer of 2001, provided an opportunity to design the Global Agenda for 2010. In the Annual Meeting 2002, in New York, GLTs participated in the Special GLT Private Programme, during which we held a breakfast with Bill and Hillary Clinton and a private session with US Secretary of State Colin Powell. GLT programmes also form part of the regional summits. In the last USA Meeting, the GLTs discussed the US role in the Middle East. In the Africa Economic Summit 2002 in Durban there was a joint NGO-GLT discussion on the New Partnership for Africa's Development (NEPAD).

Technology Pioneers The Technology Pioneers programme was formed in 2000 to provide new perspectives on the technology horizon. Each year, the World Economic Forum selects up to 100 Technology Pioneers, who are chief executives of companies that are developing and applying the most innovative and transformational technologies. Sixty-nine Technology Pioneers were selected for the class of 2002, representing companies engaged in cutting-edge work in information technology, biotechnology and renewable energy. At the Annual Meeting 2002 in New York, Technology Pioneers participated in a private programme designed to explore synergies among and between different technology sectors. In a specially designed workshop, Technology Pioneers, along with Governors of the information technology, health and telecommunications industries, discussed ways of applying innovative technology to further economic and social development in developing countries. At the USA Meeting 2002, Technology Pioneers met privately with executives in the technology industry to discuss how to maintain an environment open to innovation and entrepreneurial talent in a tough and cynical economic climate.

Social Entrepreneurs The World Economic Forum is working closely with the Schwab Foundation for Social Entrepreneurship, which supports enterprises founded primarily for the public good. The Schwab Foundation celebrates individuals who identify and apply practical solutions to social problems, by embracing business principles in an innovative and resourceful way. It plays a distinct but complementary role to the World Economic Forum. Each year, the Schwab Foundation selects a number of outstanding social entrepreneurs. These individuals are invited to the World Economic Forum’s Annual Meeting and its regional summits. These opportunities provide the social entrepreneurs with both credibility and access to potential sources of financial and in-kind support.

Social Entrepreneurship Javier Hurtado Mercado* has fostered a shift in attitudes in his native Bolivia: transforming peasants into empowered micro-entrepreneurs.

Javier Hurtado Mercado

Hurtado’s company, Irupana, makes organic products, such as coffee, honey, marmalade, dried fruit and cereals. The goods are sold throughout Bolivia and are now being exported abroad.

Irupana buys direct from 1,700 family farms across Bolivia. By cutting out the middleman and concentrating on premium-priced organic foods,

the company is able to pay its supplier farmers 25% more than market rates. Irupana encourages the farmers to keep part of their harvest, so improving their family diet. By integrating poor communities into the Bolivian agriculture value chain, Irupana is enabling people formerly dependent on aid handouts to become self-respecting businesspeople. *Hurtado was one of a group of 60 outstanding individuals appointed in 2001/02 to the Schwab Foundation for Social Entrepreneurship network.

www.weforum.org 21

Teamwork behind the scenes at the World Economic Forum.

22

Our people

A truly international team

The reputation of the World Economic Forum depends entirely on its values, insight, knowledge and people. Its community of highly committed people provides quality expertise and support to members and constituents. The team at the World Economic Forum is truly international. In the year under review, our people represented 26 nationalities. This range of cultural experience is clearly important for us to be able to support our global members and the participants at our events around the world. The World Economic Forum is a youthful organization with a current average age of 35 years. That said, we have always believed it important to balance the fresh thinking that youth brings with the insights that come from long experience in world affairs. This blend of experience can clearly be seen by a breakdown of employee ages for the year under report. Of the 171 people who work for the World Economic Forum, two-thirds are university graduates. The remuneration policy in 2001/02 continued to combine the World Economic Forum’s status as a not-for-profit foundation with the need to attract the best people. Forum staff are encouraged to engage in external social and cultural activities provided there is no conflict of interest.

Nationality

Numbers

American Armenian Austrian Belgian British Canadian Chinese Colombian Costa Rican Danish Dutch Finnish French German Irish Italian Jordanian Malagasy Malaysian Mexican New Zealander Norwegian Spanish Swedish Swiss Thai

17 1 2 1 5 5 1 1 1 1 2 1 19 13 1 2 1 1 1 1 1 3 3 2 84 1

Nationalities

26

Age Group 20 25 30 35 40 45 50 55 60 63 65

to to to to to to to to to to or

24 29 34 39 44 49 54 59 62 65 older

Numbers 13 46 46 21 13 10 7 8 5 1 1

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Our organization

The 2002/03 World Economic Forum Managing Board. From right, José María Figueres, Klaus Schwab, Frédéric Sicre, Rick Samans, André Schneider and Michel Ogrizek

The Managing Board The Managing Board acts as the executive body of the Foundation Board. It ensures activities and services fulfil the mission of the World Economic Forum and represents it in its dealings with outside parties. The Managing Board members for the 2002/03‡ are as follows: Klaus Schwab President and Founder, Aged 64 Qualifications: Swiss Federal Institute of Technology and the Universities of Fribourg and Harvard. Degrees include Doctorates in Mechanical Engineering and in Economics (summa cum laude). Taught business policy since 1969 and has been a Professor at the University of Geneva since 1972. Author of several books, the yearly Global Competitiveness Report (since 1979) and many other publications. Founded the World Economic Forum in 1971 as a not-for-profit foundation building it into the foremost global partnership of business, political, intellectual and other leaders of society committed to improving the state of the world. Recipient of numerous academic and national honours for initiatives undertaken in the spirit of entrepreneurship in the global public interest and for peace and reconciliation efforts in several regions.

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José María Figueres Managing Director, Aged 48 Qualifications: Bachelor Degree in Engineering in 1979. Joined the United States Military Academy (USMA) at West Point in 1991 followed by MPA, Kennedy School of Public Administration, Harvard University. Positions held: General Manager, Fibers of Central America, 1980-84. President of the San Cristobal Agroindustrial Group from 1984-87. Minister of Foreign Trade for Costa Rica, 1987-88, becoming the Minister of Agriculture from 1988-90 and President of Costa Rica from 1994-98. Joined the World Economic Forum in 2000 as Managing Director. Additional posts held: President of the Board of Leadership in Environment and Development (LEAD), Member of the Board of Directors: World Resources Institute (WRI), Stockholm Environment Institute (SEI). Frédéric Sicre Managing Director, Aged 38 Qualifications: BA in Literature, Villanova University, Philadelphia, Pennsylvania, USA. Positions held: managing a communication centre within the NATO organization, Germany. Programmer, News Reporter for Radio Geneva Information and KTFM radio stations, 1982-84. Joined the World Economic Forum in 1989. In 2000, he became Managing Director with direct responsibility for the Centre for Regional Strategies.

Rick Samans Director, Global Issues, Aged 44 Qualifications: BA in Economics and French from Tufts University and a Masters in International Affairs from Columbia University. Positions held: Corporate Lending Officer, Credit Lyonnais USA, New York from 1981-84. Legislative Assistant to a member of the House Committee on Ways and Means from 1985-88. Professional Staff Member and Senior Legislative Assistant to the Chairman, Senate Banking Committee; International Affairs Fellow, Council on Foreign Relations, London and Washington DC from 1988-91. Associate Director and Staff Director for the Subcouncil on Capital Allocation, Competitiveness Policy Council, 1993-96. Economic Policy Adviser to the Senate Minority Leader from 1996-99. Special Assistant to the President for International Economic Policy, USA, 1999-2001. Joined the World Economic Forum in 2001 as Director, Global Issues and as an Associate Member of the Managing Board. André Schneider Director, Resources and Knowledge Management, Aged 43 Qualifications: Classical Orchestra Musician; Diploma, Richard Strauss Konservatorium, Munich. PhD in Computer Science, University of Geneva. Positions held: the Philharmonic Orchestra of Berlin; the Staatsheater Kassel; the Symphony Orchestra of the Radio Saarland; the Lucerne International Festival Orchestra. Researcher in parallel computers for the European Community; various positions held with IBM, including: Product Developer; Consultant and Principal, IBM Consulting Group; Consultant for various companies and organizations; Speaker on IT-related topics. Joined the World Economic Forum in 1998, appointed Director of Knowledge Management and an Associate Member of the Managing Board in 2000.

Michel Ogrizek* Director, Communications, Aged 55 Qualifications: Medical Doctor, University of Paris, 1974. Positions held: Chief Medical Officer at the French Ministry of Cooperation from 1975-82. Research Associate in the Department of Cultural Anthropology and post-doctoral studies at Berkeley, 1982-83. Medical and Public Affairs Director, Africa Region and Medical Director, Canada, at Warner Lambert from 1983-87. Médecins Sans Frontières trainer. From 1987-91, Director, Burson-Marsteller, France. President and CEO, Hill & Knowlton, France, and Head, Eurosciences, from 1991-95. From 199597, President and CEO for Europe and Board member, Edelman Public Relations Group. Global Head of Corporate Relations, Unilever from 19972000. Global Head, Marketing & Communications and Managing Director, UBS Warburg from 2000-02. Joined the World Economic Forum in mid-2002 as Director of Communications and as an Associate Member of the Managing Board. ‡

During the year 2001/02, Donna Redel (Managing Director) and Charles McLean (Director of Communications) left the Managing Board. *Joined the Managing Board in mid-2002.

www.weforum.org 25

Our organization

Structured to meet stakeholders’ needs Corporate Governance The organizational structure is permanently under review in our continuous effort to ensure that we are responsive to the evolution of the world and are meeting the needs of our stakeholders.

“If the big economies slow and the big economies get the sniffles, the rest of us get pneumonia. There is a need to pursue growth with the big guys and the small guys.” Mike Moore, Director-General, World Trade Organization, Annual Meeting 2002

The Foundation Board The Foundation Board acts as the guardian of the World Economic Forum's mission, values and brand, inspiring business and public confidence through an exemplary standard of governance. This includes: managing the statutes of the World Economic Forum and its institutions; defining the powers of the Committees and of the Managing Board; appointing new members; reviewing fund applications; and determining and monitoring the execution of the World Economic Forum’s strategies. The Board comprises 15-24 eminent individuals from business, politics, academia and civil society, each serving a three-year term. The membership criteria include integrity, global vision, leadership experience and participation in world affairs.

26

The Foundation Board members for the year 2002/03* are: • Klaus Schwab, President of the Foundation Board • William I.M. Turner, Chairman and CEO, Exsultate Inc., Canada; Vice-Chairman of the Foundation Board • Josef Ackermann+, Spokesman of the Board, and Chairman of the Group Executive Committee of Deutsche Bank AG, Germany; Vice Chairman of the Foundation Board • Kurt Alig, Chairman, Arcadia Treuhand AG, Switzerland; Secretary of the Foundation Board • Peter Brabeck-Letmathe+, Vice-Chairman and CEO, Nestlé SA, Switzerland • Lord Carey of Clifton+, Former Archbishop of Canterbury, United Kingdom • Flavio Cotti, Former President of Switzerland • Michael S. Dell, Chairman and CEO, Dell Computer Corporation, USA • Niall FitzGerald+, Chairman, Unilever Plc, United Kingdom • Rajat Gupta, Managing Director, Worldwide, McKinsey & Company Inc., USA • Nobuyuki Idei, Chairman and CEO, Sony Corporation, Japan • Caio Koch-Weser, Secretary of State of Finance, Germany • Graça Machel+, Chairperson, Foundation for Community Development, Mozambique • Henry McKinnell+, Chairman and CEO, Pfizer Inc., USA • Heinrich von Pierer, President and CEO, Siemens AG, Germany • Peter Sutherland, Chairman of Goldman Sachs International; Chairman of British Petroleum Company Plc, United Kingdom • Ernesto Zedillo+, Director, Yale Center for the Study of Globalization, USA; Former President of Mexico

During the year under report, and at the Foundation Board meeting of 4 November 2002, the following Foundation Board members retired due to their age or to other reasons: they were Percy Barnevik, Raymond Barre, Ronnie C. Chan, Guy Fontanet, Helmut Maucher, Jean-Marie Messier, Ferdinand Piech and Maurice F. Strong. The Foundation Board would like to express their gratitude to all outgoing members. In particular, they would like to give their heartfelt thanks to Guy Fontanet, for his wisdom, dedication and loyalty, and to Raymond Barre and Maurice Strong for the great contribution they have made to the development of the World Economic Forum since it was first created.

The CGA also manages the World Economic Forum’s engagement with its constituencies, including the academic and scientific communities, business trade bodies, international organizations, labour leaders, non-governmental organizations, religious leaders, Technology Pioneers and Global Leaders for Tomorrow. (See www.weforum.org/globalagendamonitor) The Centre for Global Industries The Centre for Global Industries (CGI) handles relations with the World Economic Forum’s membership. The CGI is divided into five broad industry groupings, to allow the development of expertise and special relationships with members covering: basic industries, communications and technology, consumer goods and health, financial services and mobility industries.

+ Appointed on 4 November 2002. The Committees of the Foundation Board The Foundation Board appoints four Committees from among its members: • The Executive Committee defines the rules of procedure of the Foundation Board and represents the World Economic Forum to third parties. • The Audit Committee ensures compliance with all financial, accounting and control processes. • The Evaluation and Remuneration Committee recommends candidates for positions on the Managing Board. • The Mission Compliance Committee reviews Forum policies, strategies and activities in light of its mission.

Practice Structure In 2001/02 the World Economic Forum organized its work into three integrated practices. The Centre for the Global Agenda The Centre for the Global Agenda (CGA) monitors and analyses global issues to provide content for the World Economic Forum’s annual, regional, country and industry meetings. It stimulates thinking and dialogue by organizing task forces and other initiatives involving different regions, intellectual disciplines and stakeholders in the world economy.

The Centre for Regional Strategies The Centre for Regional Strategies (CRS) provides members and constituents with a series of outcome-oriented summits in markets of major strategic interest. It builds communities of leaders drawn from business, politics, academia, religion, media and other areas of civil society who share the World Economic Forum’s mission. The regional summits allow members and participants to share, face-to-face, information and insights on key developments and trends of regional significance. They also give the issues an audience which extends to all stakeholders of global society. CRS works closely with both CGA and CGI, with the regional summits serving as a platform for the World Economic Forum’s global initiatives. Partnerships The World Economic Forum also seeks partnerships with like-minded institutions. It has, for example, NGO consultative status with the Economic and Social Council of the United Nations and works closely with the Prince of Wales International Business Leaders Forum and the World Business Council for Sustainable Development.

www.weforum.org 27

Participants in the Annual Meeting 2002 were each offered a ‘Davos Companion’. This handheld Compaq iPAQ with wireless LAN allowed them to download e-mails, find information about the programme, book places in sessions and transfer digital images.

28

Our organization

Sharing knowledge

Information Technology and Knowledge Management The World Economic Forum’s strength lies in its ability to coordinate the unique resources of its global membership and multistakeholder constituencies. It is dedicated to achieving its strategic vision by developing a core of world-class skills and systems that will support its mission. The World Economic Forum hosts a large number of virtual communities, which provide extensive information to its partners, members and the general public. In 2001/02, the World Economic Forum successfully completed a number of initiatives in support of its information technology and knowledge management needs.

The World Economic Forum further improved its external processes by launching some key projects: • The implementation of a new Internet site including a content management tool, knowledge navigator and other facilities, to increase interaction between members and partners • Twenty distinct initiatives for the Annual Meeting 2002, including the first-ever wireless infrastructure to provide participants with event information and late-breaking news. The solution combined kiosks and hand-held computers, helping to keep participants in touch with each other and the outside world.

“We have to use technology responsibly for the good of the entire created order.” Anglican Archbishop Njongonkulu Ndungane, Archbishop of Cape Town,

These initiatives included: • An enhanced technology platform providing better tools, such as an integrated event management and constituent relationship system • A strengthening of the World Economic Forum’s knowledge hub to provide a more stable IT platform • Improved security options to protect internal data and systems

Annual Meeting 2002

Looking to the future, the World Economic Forum aims to build on its stable IT platform with further enhancements and an improved knowledge management environment.

www.weforum.org 29

Sharing knowledge

Communications A Policy of Transparency and Openness Communication plays an integral part in achieving our mission. The World Economic Forum can only bring a finite number of people together at its events. Communication enables us to share the insights and expertise of our members with the wider global community.

Online Access to Information The Internet enables us to provide large amounts of information to our stakeholders. In November 2001 we relaunched our website. This was an immediate success with hits on the site doubling over the previous year’s figures. During the peak period of January 2002 the members’ area of the site averaged 500 visits a day.

The World Economic Forum believes that transparency is an essential part of good governance. In view of the importance of our activities, we must communicate openly and transparently. This is why we share full information about our activities and internal operations with our stakeholders through our website and printed publications. We also fully integrate media leaders into debates at our summits and meetings.

Dialogue with NGOs We continued to build communications bridges with non-governmental organizations and constructive anti-globalization movements. In many cases we share common humanitarian goals with these organizations, despite having different views on how to achieve a significant improvement in the state of the world.

Our strategy of developing relationships with the mainstream media, as well as the business press, and the openness of our organization contributed to largely positive press coverage during the year. The Annual Meeting 2002 in New York resulted in particularly constructive editorial. In 2001/02, we forged several strategic partnerships with the media. These included collaborations with Time magazine, with which we have a dedicated partnership around Technology Pioneers (see www.weforum.org/techpioneers), and Newsweek International, for which we provided theme ideas, contacts and survey data for four 2002 editions. (For further information see www.weforum.org/media)

30

In 2001/02, the World Economic Forum invited key non-governmental organizations to be involved in task forces, initiatives and public debates. Sixty global NGOs were represented at the Annual Meeting 2002 including Amnesty International, WWF, Save the Children, Oxfam, Terre des Hommes, Transparency International and Human Rights Watch.

Our mission and strategic vision Our values and principles Our mission and strategic vision The World Economic Forum is an independent, international organization committed to improving the state of the world. In aiming to achieve this mission, the World Economic Forum embraces new challenges by developing initiatives which support its core principles and values. These are to: • Provide a collaborative framework for world leaders to address global issues • Promote entrepreneurship in the global public interest • Maintain a non-partisan and independent position Our Vision The World Economic Forum will be a leader in identifying strategic issues and will provide a platform for decisionmakers to effect constructive change. The World Economic Forum facilitates dialogue between corporate, political, intellectual and other leaders on matters of global, regional, corporate and industry importance. It facilitates discussion, acting as a catalyst for the development and coordination of key strategic insights. The World Economic Forum is changing. It is evolving from a global event provider to becoming a body that offers a world-class knowledge base and which identifies strategic issues. Our Value Proposition The World Economic Forum aims to facilitate: • Dialogue between chief executives of world-leading companies and key stakeholders in global society • Early identification and definition of issues of central importance

Our values and principles The World Economic Forum’s task is to be a credible, independent broker, characterized by intellectual integrity, commitment and strong principles. The World Economic Forum is guided by a set of core principles: • The stakeholder concept: Companies should serve all stakeholders to form a community of destiny. • Cooperation not confrontation: World improvement will occur through joint effort by: Bonding – defining problems together Binding – defining joint objectives Building – defining joint action • Global entrepreneurship: Creates societal progress. Economic activities should serve the global public interest. • Corporate citizenship: Companies must take short and long-term social and environmental responsibility. • Globalization: The need to globalize globalization: Globalization should be supplemented by political and social measures. • Global responsibility: Shared values are necessary to provide a framework for global decision-making. • Social entrepreneurship: Global cooperation at the leadership level has to be supplemented by concrete actions on the ground. Social entrepreneurs are a key driver for societal transformation and progress. The World Economic Forum promotes the protection of the environment and sustainable development, fulfilling a global environmental stewardship role. It respects different cultures, cultivating an environment that values diversity and inclusiveness. The World Economic Forum strives to be the key builder of

• Focused engagement enabling global change

global communities:

The World Economic Forum will play a unique and essential

• Those fully integrated into the World Economic Forum,

role in identifying issues on all levels that could affect its partners, members and global citizens. The World Economic Forum supports its members and partners in major aspects of global effort through multistakeholder

such as members • Those providing advice, such as the constituency advisory groups • Those who have autonomy but share and support the

collaboration and public/private partnership. Its ability to

World Economic Forum’s mission, such as the International

provide a neutral ground for discussion is a fundamental

Business Council and the Global Leaders for Tomorrow

component of its vision and mission.

As an organization ‘without borders’ at the heart of the

Any initiative proposed must:

communities it serves, the World Economic Forum

• Conform with the World Economic Forum’s mission of

combines a range of approaches to support its mission,

improving the state of the world

such as seconding employees to members to help them

• Act in the interests of its members

achieve their goals.

• Address an issue of significant global, regional, corporate

The World Economic Forum promotes learning and

or industry importance

knowledge through group interaction, shared experience and

• Be unique to the World Economic Forum

expertise. It maintains high-level learning communities by:

• Reflect distinctive competencies within the World

• Understanding what makes them successful

Economic Forum

• Developing and experimenting new technologies that support virtual interaction and knowledge sharing • Structuring itself as a best practice learning organization

www.weforum.org 31

Our financial results

The World Economic Forum’s financial policy states that membership fees should cover operational costs, that events are funded through participation fees, and that projects are supported by the income from partnership contracts. Approximately 5 to 10% of the World Economic Forum’s income each year is saved to strengthen its reserves for new initiatives. This year the surplus added to Foundation Capital was Sfr. 3,118,445.

Auditors The World Economic Forum’s financial results are audited by PricewaterhouseCoopers who examine the balance sheet and accounts. The annual report, as well as all institutional documents, are submitted to the Swiss Federal Government, which acts as the supervisory body of the Foundation.

Total Income 1997-2002 figures in Swiss francs

32

51,306,002

61,100,642

63,806,052

72,195,453

The World Economic Forum makes no payments to political personalities, parties or other organizations and avoids involvement in internal politics.

51,890,452

The World Economic Forum may accept donations, legacies, grants and other contributions or subsidies that are consistent with its purpose of ‘integrating leaders from business, politics, science and society at large into a community for global action committed to improving the state of the world and the well-being and prosperity of human society’.

1997/ 1998

1998/ 1999

1999/ 2000

2000/ 2001

2001/ 2002

Key figures

Year

1997/1998

1998/1999

1999/2000

2000/2001

2001/2002

Total income* out of which members’ fees participation fees partnership

51,890,452

51,306,002

61,100,642

63,806,052

72,195,453

18,761,000

20,915,531

22,106,920

23,588,125

24,965,367 26,972,981 18,946,940

Total expenditure out of which personnel costs office costs activity-related costs

51,047,818

50,380,441

59,416,135

63,556,294

69,077,008 27,097,659 10,642,445 31,336,904

Surplus to be added to the Foundation capital

842,633

925,560

1,684,507

249,759

3,118,445

Foundation capital

6,136,481

7,062,041

8,746,549

8,996,308

12,114,753

73

68

81

125

139

22

4 28

Total staff Full time out of which are seconded by Forum members Part time

26

24

22

In its continued effort to support the Forum strategy, in 2001 the Forum continued to invest particularly in its human resources, which was reflected in an increase of personnel costs of 14.96%. * all key figures in Swiss francs

World Economic Forum, 91-93 route de la Capite, CH-1223 Cologny/Geneva, Switzerland Telephone +41 (0)22 869 1212 Fax +41 (0)22 786 2744 e-mail: [email protected] www.weforum.org

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