Every year, almost 3000 people descend upon the sleepy town of Davos in Switzerland to attend one of the most exclusive events of the year: World Economic Forum, which will be held from January 21 to 23.
But while the event itself is well documented, what is less well known is Pakistan’s involvement in the event. Which Pakistanis get to go, and what do they talk about? How important is the WEF for Pakistan?
Profit provides a guide to all your questions:
WHAT IS DAVOS?
Davos is the name of the tiny Swiss village, with a population of only 11,000 people where the World Economic Forum, (WEF) holds its annual meeting. The WEF’s genesis was in 1971, when German economist Klaus Schwab decided he wanted to create a conference for European businesses, primarily to meet each other and expose them to American management methods. With the funds from the first meeting, he created the European Management Forum. This was renamed World Economic Forum in 1987 and essentially morphed into a platform for dialogue between world and business leaders. The WEF was recognized as an international institution in 2015, and this year marks the event’s 50th anniversary.
WHAT IS THIS YEAR’S EVENT ABOUT?
This year’s slogan is “Stakeholders for a Cohesive and Sustainable World”, and the overall theme is regarding sustainability. Within that overarching umbrella of sustainability, there are a further seven themes: healthy futures, how to save the planet, better businesses, beyond geopolitics, tech for good, society and future for work, and fairer economics.
WHO GETS TO GO?
The WEF features a mix of company leaders, business heads, political leaders, civil society members, and members of the media. This year, there are almost 2782 registered participants. Delegates include representatives from 117 countries, and 121 nationalities.
In particular, 91 countries from around the world are sending representatives from their governments, with about 53 heads of state attending. In addition, about 600 public speakers will be presenting at the event this year.
The WEF will also feature at least 17 banking and investment companies, including Bank of America, BlackRock, Goldman Sachs, Bridgewater Associates, JPMorgan Chase, and Lazard.
As evidenced above, Davos is often branded as an ‘elite’ event, due to its heavy skew towards large corporations and extremely rich businessmen. Famously, Jamie Dimon, the head of investment bank JP Morgan, said Davos was best summed up as: “It is where billionaires tell millionaires what the middle class feels.”
Recently though, the WEF has made attempts to include more ‘regular’ people, with this year more than one-third of the participants hailing from civil society, academia and media.
WHO GETS TO GO FROM PAKISTAN?
The breakdown of participants from Pakistan is similar to the global breakdown, with the same mix of heads of government, businesses and companies, and people deemed ‘important’ by the WEF.
From the government’s side, this year Prime Minister Imran Khan will be attending, as well as Foreign Minister Shah Mahmood Qureshi, Adviser on Commerce Abdul Razaq Dawood, Special Assistant on Overseas Pakistanis Zulfiqar Bukhari and Special Assistant National Security Division Mooed Yusuf. Tania Aidrus, the PM’s point person for Digital Pakistan, will also be attending to discuss digitization in the country. The State Bank Governor, Dr Reza Baqir, and Advisor to the Prime Minister on Finance Dr Hafeez Shaikh will also be attending, to discuss CPEC.
The WEF also extends invitations to large companies in Pakistan. Historically, invitations have been handed out to the heads of five corporations: the Dawood Hercules Group, Martin Dow Ltd, Pathfinder Group, Habib Bank Ltd, and JS Group.
In particular, the chairman of Pathfinder Group, Ikram Sehgal, and the chairman of the Dawood Hercules Group, Hussain Dawood, have been consistently and actively participating at Davos since at least 1992.
In addition to the heads of state and business in Pakistan, the WEF also extends invitations to Young Global Leaders, or around 800 people each year chosen by the WEF that represent ‘contemporary leadership’.
Pakistanis chosen as YGLs in the previous years have included: writer Fatima Bhutto, filmmaker and director Sharmeen Obaid Chinoy, political commentator Fasi Zaka, columnist Mosharraf Zaidi, former Foreign Minister of Pakistan Hina Rabbani Khar, CEO of Khaadi Shamoon Sultan, and Ambassador for Foreign Investment Ali Jehangir Siddiqui.
WHO PAYS WHAT (AND GETS ACCESS TO WHAT)?
Good question. The fees depend on what capacity the individual is attending the event in: via the government, civil society or through a company.
Typically, companies often pay annual fees to be members with the WEF. Membership is stratified by level of access and engagement with the forum’s events and projects. The higher the fee, the more the access. Membership and partnership fees range from CHF60,000 to CHF600,000, or Rs9.6 million to Rs96 million. The event itself is sponsored by the fees of the top member companies.
There are four different types of membership possible:
Strategic Partners, which are around 100 ‘top tier’ global companies. As per the WEF, these are “only the most recognized corporations with demonstrated track records of good governance and alignment with Forum value”. Strategic Partners get to participate in a minimum of five different platforms at the forum. This year, there are only 120 Strategic Partners. Examples of strategic partners include Facebook, Goldman Sachs, Nestle, and Uber.
Strategic Partner Associates, which are the world’s ‘leading’ businesses. Strategic Partner Associates can engage with up to four platforms at the forum. This year, there are around 57 Strategic Partner Associates. Examples include Google, Bloomberg, and Softbank.
Partners, which are ‘world-class’ companies. Partners may engage in up to three platforms. This year, there are around 320 Partners. Only one Pakistani company, Dawood Hercules Group, is listed as a ‘Partner’.
Dawood Hercules is the parent company that owns Engro Corporation. [When contacted for comment, DH Group said they could not provide comment on when this membership was bought, or the total amount of money that DH Group spends on the event.]
Associate Partners, which are companies that are ‘active participants’ in Forum communities. Associate Partners are entitled to engage in one platform. This year, there are around 211 Associate Partners.
Membership of companies includes the opportunity to participate in the annual meeting for the CEO of the company. However, Davos participation itself has a fee separate from membership or partnership fees. For this year, according to sources, the fee for the invitation is CHF 27,000, or Rs4.3 million.
Typically, the invitation to the main hall of the forum is for the chairman or CEO of the company (the invitation also includes another invitation for a spouse as well). The chairman is often accompanied by a delegation of 6-10 senior executives, depending on the company. However, the delegation does not have access to the main hall: instead, members of the delegation are often mingling and busy meeting other members from around the world, at panels or meetups in the town itself. This extra eco-system created on the side of the main conference is often referred to as the ‘fringe’, and is often extremely useful for exchange of ideas.
Non-business participants, such as civil society, the arts, young global leaders, and heads of state do not pay to participate.
However, governments do have to end up paying hefty amounts to cover for the accompanying delegations. For example: Prime Minister Imran Khan’s upcoming three-day visit to Davos is expected to cost $68,000, or Rs10.5 million to the national exchequer. According to sources, the original cost was close to $250,000, or Rs38.7 million, and was only brought down after the prime minister was reportedly unhappy, and refused to go.
WHAT IS THE PAKISTAN PAVILION, AND THE PAKISTAN BREAKFAST?
As mentioned before, the World Economic Forum is just one aspect of Davos. During the forum’s run, Davos is also host to different panels and meetups on the side of the conference.
The Pakistan Pavilion, and the Pakistan Breakfast are two such events. For the last 19 years, both Martin Dow Ltd. and Pathfinder Group have jointly hosted these events. Previously, it was actively promoted by those two groups chairmen, Ikram Sehgal and the (late) Javed Akhai. Recently, their respective sons, Zarrar Sehgal and Ali Akhai have also been active.
The two events are private affairs and are not related to the WEF; however, since it has been hosted for so many years, Ikram Sehgal has almost become synonymous in Pakistani business circles with the WEF itself. Often, Martin Dow Ltd. and Pathfinder Group send invitations on their own to relevant Pakistani business leaders and chairmen to attend the breakfast and pavilion. For some, the costs to travel to Switzerland are covered; others have to pay out of their own pocket.
This pavilion itself is a walk-in affair, where there are several stalls hosted by Pakistani professionals. These include entrepreneurs, government officials, Pakistanis who work in financial services, and philanthropists. The pavilion is generally seen as a way for Pakistanis to interact with international investors and experts.
But an equally important, if not more important event, is the tradition of the Pakistani Breakfast.
This is a breakfast typically held on the third day of the event, and usually has either the president or the prime minister of Pakistan as the chief guest.
The Pakistan Breakfast is usually the ‘highlight’ of the Pakistani experience at Davos. Anywhere between 60 to 300 people often attend the breakfast, and discuss Pakistani policy-related topics. This is also often a showcase for Pakistani ‘food and culture’.
This year, in an unexpected move, Prime Minister Imran Khan will be the first person from a developing country to be a keynote speaker at a ‘plenary session’. The session is WEF’s Special Session ‘Beyond Geopolitics’, along with President of the World Economic Forum Børge Brende, and will be held on Wednesday, January 22.
WHAT’S THE VALUE OF GOING TO DAVOS?
Since the inception of the WEF, critics have constantly called it nothing more than a ‘talking shop’, where leaders talk a fair bit, and accomplish little. As mentioned before, it is also seen as an ‘elite’ event, that mischaracterizes the real problems that most of the world faces.
However, there is still value in Pakistani officials, and Pakistani companies in general, attending the event.
On a national level, both the pavilion and the breakfast are considered important in terms of branding, and in developing a positive image of Pakistan. Since government officials feel that Pakistan is often treated ‘unfairly’ by global media, Davos offers an opportunity to counter that narrative. The pavilion is a way to share information, and represent national opinions not often talked about the media to a global stage. The breakfast, in particular, is seen as an opportunity for the government to share its stories in a more informal way to tell people in the audience who they are.
In particular, the mere presence of Pakistan is important, in that it is seen as a global player, or at least interested in global events.
For Pakistani business, the event is economically significant, in that Davos offers access to new resources and ideas.
In conversations with Profit, the companies said that those which are looking at ways to create a long-term vision, or greater societal impact, often look forward to Davos, since it is the best way to learn about the most recent developments and innovations happening globally.
And despite the relatively high cost of the event, it would in fact be more costly to arrange for separate flights and meetings with individuals, companies and leaders around the world throughout the year. The forum is instead a convenient way to exchange ideas, and gain access to important people, all in the span of just three or four days.
WHY DO SO FEW PAKISTANIS GO?
Just as there are those who believe there is value in WEF, there are those who find the whole thing pointless. As this guide has revealed, very few Pakistani companies or businesses, or even CEOs of those companies attend the event.
The first problem is capital – the cost of attending the event is quite high, and not all companies can afford the fees.
However, in conversations with Profit, sources revealed that the problem isn’t necessarily capital. There are several midsize to large companies that could easily afford the fee. If they attended foreign events or made an effort on other regional or global stages, or expressed ‘global aspirations’, they could easily receive an invitation to the forum, and also be able to pay for it.
Yet many companies simply do not bother. For a company to be able to receive value from the forum, the company has to have a set identity, a larger vision, or have ideas about the societal impact of their products and services. They have to be willing to engage with global ideas about the latest technology, for instance, or sustainability. Companies will also be interested in forums like the WEF if they are interested in investing abroad, and not simply getting foreign partners to invest in Pakistani projects. Not many in Pakistan have that sort of scale to invest.
Unfortunately, Pakistan is a much more closed-off society, where businesses instead of looking towards frontier markets, look instead to foster close governmental ties. Energies are instead spent not on cultivating global contacts, but on forming government relationships for favourable subsidies and policies. Most companies in Pakistan are family companies, and while they often consider what would be good for business, they do not consider forging a brand narrative, or brand identity.
Forums like Davos thrive very much on brand identity, and cultivating a more global outlook. This shortsightedness on the part of Pakistani businesses has meant that within South Asia, more companies and business leaders from India, Bangladesh and Sri Lanka attend, than from Pakistan.
Ikram Sehgal himself alluded to this problem in his most recent op-ed, saying: “It is unfortunate that only a handful of Pakistani businessmen come to Davos, they can never shoulder the burden of projecting Pakistan. Davos is a unique opportunity to showcase Pakistan, it is imperative that those who matter in our business sector start using the Davos platform.”
