world economic forum Annual Report 2002/2003

Building trust, peaceand reconciliation

Annual Report 2002/2003

Queen Rania of Jordan, member of the World Economic Forum Foundation Board, visits a schoolinformation technology lab as part of her project to computerize education. The projectintroduces IT to students and enhances Jordan’s human resources by equipping the people withthe necessary skills to compete in the global economy.

Klaus Schwab, Executive Chairman of theFoundation BoardWilliam I. M. Turner, Chairman and CEO, Exsultate Inc.,Canada; Vice-Chairman of the Foundation BoardJosef Ackermann, Spokesman of the Board and Chairmanof the Group Executive Committee, Deutsche Bank AG,Germany; Vice-Chairman of the Foundation BoardKurt Alig, Chairman, Arcadia Treuhand AG, Switzerland;Secretary of the Foundation BoardPeter Brabeck-Letmathe, CEO, Nestlé SA, SwitzerlandLord Carey of Clifton, Former Archbishop of Canterbury,UKVictor L. L. Chu, Chairman and CEO, First EasternInvestment Group, Hong Kong SAR(appointed: 21 August 2003)Flavio Cotti, Former President of SwitzerlandMichael S. Dell, Chairman of the Board and CEO, Dell Computer Corporation, USANiall FitzGerald, Chairman, Unilever Plc, UKRajat Gupta, Senior Partner, Worldwide, McKinsey &Company Inc., USANobuyuki Idei, Chairman and CEO, Sony Corporation,JapanCaio Koch-Weser, Secretary of State of Finance ofGermanyHenry A. McKinnell, Chairman and CEO, Pfizer Inc., USAHeinrich von Pierer, President and CEO, Siemens AG,GermanyH.M. Queen Rania of the Hashemite Kingdom of JordanPeter D. Sutherland, Chairman of Goldman SachsInternational; Chairman of British Petroleum Company Plc,UKErnesto Zedillo Ponce de Leon, Director, Yale Center forthe Study of Globalization; former President of Mexico

Foundation Board members

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Contents

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The World EconomicForum is the foremostglobal community ofbusiness, political,intellectual and otherleaders of societycommitted to improvingthe state of the world

The Executive Chairman’s statement 2

Annual Meeting 4

Extraordinary Annual Meeting 8

The regional agenda 10

Task forces and initiatives 14

Our members and partners 21

Our communities and constituencies 23

Our people 26

Our organization 28

Our financial results 34

Our mission and values 36

Pictured on the cover from top left are: Supachai Panitchpakdi, Director-General of the World Trade Organization;Luiz Inácio Lula da Silva, President of Brazil; King Abdullah II of Jordan, and US Secretary of State Colin Powell

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The Executive Chairman’s statement

2002/2003 was another challenging year for theinternational community, as war in Iraq, instability in the Middle East region and financial volatilitycontinued to threaten global stability. Against thistroubled background, the members, partnersand staff of the World Economic Forum workedhard towards our goal of improving the state of the world.

The Annual Meeting 2003, which returned toDavos after the 2002 sojourn in New York, againdemonstrated how the World Economic Forumacts as a platform for addressing challenging ideasand as a prompt to delivering timely approaches to major global issues.

Significant outcomes included:• The launch of the World Economic Forum GlobalGovernance Initiative to evaluate progress towardsthe UN Millennium Declaration goals• The news that US company, PharmaciaCorporation, was to expand access to drugs forthe world’s poorest people, particularly in regard to HIV/AIDS medication• The announcement by the Bill and Melinda GatesFoundation of a US$ 200 million donation toestablish the Grand Challenges in Global HealthInitiative, to research diseases that are a particularblight to the developing world

In today’s increasingly complex and interlinkedworld, global leaders can only resolve major issuesand gain strategic understanding by workingtogether. The World Economic Forum’s

Extraordinary Annual Meeting in Jordan, in June2003, proved this truth once again.

The Extraordinary Annual Meeting provided a timelyopportunity for world leaders to come together andprogress towards reconciliation and reconstruction,in the immediate aftermath of the Iraq war.

As is customary with World Economic Forum events,the Extraordinary Annual Meeting establishedrelationships and communication channels that willendure far beyond the meeting room. In particular,the establishment of the Arab Business Councilcreated an important forum for a communitydestined to play an integral part in shaping the futureprosperity and security of the Middle East.

Such Extraordinary Annual Meeting milestones,along with those achieved at the Annual Meeting2003 and our regional summits, emphasized the continuing relevance of the World EconomicForum in addressing complex issues faced by the global community.

Our summits are just one of the ways we delivervalue to the senior business leaders that constituteour membership. In 2002/03, we continued to offerstructured assistance to help CEOs excel acrosstheir key fields of responsibility. For instance, ourinternal team, supported by industry and academicexperts, provided dedicated support in such areasas crisis management, corporate citizenship, globalcompetitiveness and motivational techniques.

Building trust,peace andreconciliation

It is testimony to the value we provide to ourmembers that, during the year, additional keymembers signalled their greater commitmentto the World Economic Forum by becomingstrategic partners.

The World Economic Forum enhanced itscredibility as an initiator of private-publicpartnerships with the August 2003 appointment of Philippe Bourguignon to the Managing Board.Philippe, whose previous roles included beingchairman and CEO of both Club Méditerranée andEuro Disney, brings huge international experiencein corporate development.

Our finances remained stable during the year,despite the effect of a tough economic climate on our members. In the year, our income droppedby 8% to Sfr. 66,454,727, largely reflecting thereturn to more customary levels of participation inthe Annual Meeting, after the hugely increasednumber of participants in New York.

To ensure that the World Economic Forum remainsa sustainable and unique organization for itsmembers, in 2002/2003, the Managing andFoundation Boards invested a significant amountof time determining how the organization couldimprove its services. The resulting strategic planwill be outlined during the next 12 months.

The World Economic Forum will continue todevelop its offering, as a means of ensuring itsmembers achieve outstanding performance.

In particular, we will continue to provide strategicadvantage, by virtue of our role as one of theworld’s leading strategic insight bodies.

Our determination to increase the value we provideis all part of our commitment to improving the stateof the world. We believe this will be best achievedthrough activities which promote economic andsocial development: a path that requires the activecollaboration of all stakeholders in society. Havingbuilt a unique position of trust, over three decades,at the heart of the world’s leadership communities,we believe we are in the best position to bringthese stakeholders closer together, bothintellectually and geographically. We owe it to our members – and the wider world – to continuefinding better and better ways of doing just that.

With the Forum so firmly at the centre of worldevents, it gives me great pleasure to report that the Foundation Board has entrusted me to buildfurther on our success and to use the next fiveyears to transform the Forum into the leadingorganization dealing with the challenges of the21st century.

Klaus SchwabFounder and Executive Chairman, The World Economic Forum

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His Majesty King Abdullah II of Jordan, left, and Kofi Annan,Secretary-General of the UN, centre, with Klaus Schwab

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A citizen wears an ‘I love WEF’ sign in his hat during the Annual Meeting 2003 in Davos

In 2003, the World Economic Forum’s AnnualMeeting returned to its home in Davos,Switzerland, following its relocation to New Yorkthe previous year in the aftermath of the terroristattacks of September 11.

The Davos Meeting was convened in a climate of global uncertainty that had seen the breakdown of trust in many sectors of society. There was littleconfidence in the ability of public institutions togovern effectively for the global common good anda lack of trust in business’s accountability towardssociety. There was also rising uncertainty about the consequences of a military conflict with Iraqand over the prospects for the recovery andsustained growth of the global economy.

For six days, 2,311 participants, including 24heads of state and the chief executives of many of the world’s most influential companies, helddiscussions around the theme of Building Trust.They focused on the key topics of trust and values, security and geopolitics, globalgovernance, prospects for the global economy and corporate challenges.

Our ability to bring together leaders from business,government, academia, the media and civil societyprovided a unique platform for dialogue. Amongthe participants were high level representativesfrom 99 countries, with more than a quartercoming from the developing world. They included

Ratio of Annual Meeting participants 2003

Business

Public figures

Media Fellows/ Leaders

Other constituents

Academia

NGOsReligious leadersTechnology Pioneers Global Leaders for Tomorrow

Annual Meeting,back in Davos

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Loyola de Palacio, Vice-President of the European Commission,during a session on the volatility of oil prices

34 religious leaders, 72 NGO representatives, 172 academic experts, 226 public figures and 268leading editors. For the first time the media groupincluded famous editorial cartoonists whose piercingart has a significant effect on public opinion.

The crisis in Iraq dominated much of thediscussion and eventually led to the convening of the Extraordinary Annual Meeting in Jordan. Post-war reconstruction in Afghanistan wasalso high on the agenda, with the participation of Abdullah Abdullah, Afghan Minister of Foreign Affairs.

The presence in Davos of a US delegation led by Secretary of State Colin Powell and leadingrepresentatives from the Middle East was a cleardemonstration of the World Economic Forum’sunique ability to bring leaders together to seekalternative solutions to global problems.

While the Middle East was a major topic, theAnnual Meeting was a focal point for discussionson the challenges facing the emerging regionalpowers. New Brazilian president Luiz Inácio Lulada Silva spoke for many developing nations whenhe called for international trade agreements to givethem greater access to developed markets.

From among a strong South American group,President Vicente Fox of Mexico called onparticipants to exercise ‘economic citizenship’.

“We need a global development strategy thatintegrates competition and efficiency with equality of opportunities and solidarity. We need,and we must link together, economic and socialpolicies,” he said.

In the global corporate arena, trust in largecompanies has been severely eroded by recentcorporate scandals. During the Annual Meetingthe results of a survey of signatories of the JointCEO Statement on Corporate Citizenship,launched in New York in 2002, were unveiled.

The results revealed a shift in corporate behaviour,with many companies seeking to further integrateethical behaviour into their business practices.The survey of CEOs from 16 countries and 18industry sectors also found that many companieshave now established board-level committees tolead their corporate citizenship strategies.

“It is vital that we build a world economic order that can

satisfy the yearnings of those billions of people who are

today excluded from the extraordinary scientific and

technological advances that mankind has achieved.”

President Luiz Inácio Lula da Silva of Brazil, at the Annual Meeting 2003

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Irene Khan, Secretary-General, Amnesty International, UK,during a discussion on identifying priorities

Luiz Inácio Lula da Silva, President of Brazil, addresses Annual Meeting participants

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While the Annual Meeting was once again acatalyst for discussion, it also provided thelaunching pad for significant practical actions to tackle global issues:

• The World Economic Forum launched the GlobalGovernance Initiative to evaluate progress in theglobal effort to implement the ambitiouseconomic, social and environmental goals setout in the United Nations Millennium Declaration

• Pharmacia Corporation, a US-basedpharmaceutical company, announced the launchof a pilot model for expanding access tomedicines for the poorest populations in thedeveloping world. The not-for-profit programme,in partnership with the International DispensaryAssociation Foundation, will increase access tomedicines for HIV/AIDS

• The Bill and Melinda Gates Foundationannounced a US$ 200 million grant to establishthe Grand Challenges in Global Health Initiative,a partnership with the US National Institutes ofHealth. The grant will increase research intodiseases that cause millions of deaths in thedeveloping world

• As part of efforts to improve economic andsocial prospects in Africa, more than 50companies operating in the region signedcovenants pledging to follow good corporategovernance and promote ethical practices

• Religious leaders from different faiths sharedmessages of tolerance during a session oncoexistence. They agreed that there is nointrinsic reason for people of different religions to be in conflict

For more about the Annual Meeting 2003 visitwww.weforum.org/annualmeeting

Annual Meeting

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Heizo Takenaka, Japanese Minister of State for Financial Services,Economic and Fiscal Policy, during a session on putting the Japaneseeconomy back on track

“Social and economic Darwinism destroys trust in

one another and demoralizes society. The long fight

for individual freedoms has ultimately resulted in a

boundless egoism.”

Pascal Couchepin, President of the Swiss Confederation,

at the Annual Meeting 2003

Open Forum Davos 2003Thousands of Davos citizens participated in the firstever series of World Economic Forum public debates.

The inaugural Open Forum Davos ran alongsidethe Annual Meeting 2003. It was co-organized by the World Economic Forum and civic societygroups, including churches, fair trade organizationsand the Swiss Red Cross.

The programme of seven debates provided an open platform for frank discussion aroundchallenging aspects of globalization, with topicsranging from ‘Can Globalization be Ethical?’ to ‘Are Children’s Rights Merely for Show?’

The free debates were attended by more than2,000 people, including local schoolchildren,participating as part of their civic educationsyllabus. The sessions, which took place in a Davos school hall, were held in German and French, with simultaneous translation.

Speakers were nominated by both the WorldEconomic Forum and the participating NGOs. They included leading international figures, such as Peter Brabeck-Letmathe, CEO of Nestlé,and Alec Erwin, South African Minister of Tradeand Industry.

The staging of the Open Forum Davos reflected a desire to make a ‘living bridge’ between the main Annual Meeting, critical NGOs and thelocal community, as a means of making theWorld Economic Forum’s mission more accessibleand transparent.

Two peaceful demonstrations, by members of theOpen Forum Davos audience, occurred during thecourse of the programme. One group staged a silent protest, with placards, against globalizationand the role of multinational companies, while thesecond group read out a critical statement duringa debate on migration.

The Open Forum Davos is set to become a regularfeature of the Annual Meeting, with next year’sdebates being around the theme of Globalizationand Deglobalization for the Benefit of the Poorest.

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The World Economic Forum continues to seek dialogue withresponsible anti-globalization groups. These anti-globalizationdemonstrators expressed their views outside the Annual Meeting 2003

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As the aftermath of war in Iraq threatened todestabilize an already volatile Middle East, the World Economic Forum convened its first everExtraordinary Annual Meeting to provide a platform for peace and reconciliation.

Based on the theme Visions of a Shared Future, themeeting took place beside the Dead Sea, in Jordan,under the patronage of His Majesty King Abdullah IIand brought together more than 1,200 business,political, religious, cultural and other leaders from 65 countries. The US delegation included Secretaryof State Colin Powell, US Chief Administrator in Iraq Paul Bremer, and Richard Lugar, Chairman of theUS Senate Foreign Relations Committee.

Jordan was chosen to host the event because of its location in the heart of the Middle East and itsreputation as a regional leader in political and socialreform. It has a peace treaty with Israel and maintainsfriendly relations with its neighbours. This made it theideal location for leaders to come together to seeksolutions to tense issues such as the future of Iraq,Arab-Israeli relations and prospects for democraticreform and economic development.

Despite being arranged in just eight weeks, theExtraordinary Annual Meeting created politicalmomentum for change. Among the practical stepstaken was the decision to create the Council of 100Leaders, composed of senior business, religious,political, media and opinion leaders from the West andthe Islamic world who are dedicated to strengtheningties and understanding between the two societies.

ExtraordinaryAnnual Meetingin Jordan

Salam Fayyad, Minister of Finance of the Palestinian Authority, listensto the speech of Shimon Peres (on screen), former Prime Minister ofIsrael, during the session 'Israel-Palestine: A Vision for the Future’

Extraordinary Annual Meeting participants

Business

Public figures

Media Fellows/ Leaders

Other constituents

Academia

NGOsReligious leadersTechnology Pioneers Global Leaders for Tomorrow

Paul Bremer, US Chief Administrator in Iraq, was among a high-level US delegation that took part in the World Economic Forum’sExtraordinary Annual Meeting in Jordan

Another significant development was the launch of a US-Middle East Free Trade Area, a region-wide agreement to open trade both with the USand between Arab nations.

Building on the participation of a strong Arabpresence at the Annual Meeting in Davos, the Arab Business Council was launched toproactively support responsible reform and moreliberal economic policies.

The World Economic Forum believes such initiativesare needed to begin to address the economicchallenges that are currently facing the region.Despite economic growth, incomes have stagnatedfollowing a rapid increase in the population. Theregion missed out on the boom in foreign directinvestment (FDI) in the 1990s and now onlyaccounts for 1% of FDI. Such factors now threatenprospects for improved social welfare.

To reinforce efforts to achieve a lasting peacebetween Israel and Palestine, attempts were madeto broaden support for the Roadmap forPeace, that had earlier been endorsed by theQuartet of the US, European Union, Russia and the United Nations.

The summit also provided a platform for the foreignministers of Israel, the Palestinian Authority, Jordanand Egypt to present their visions for the future ofthe region.

Although many obstacles to peace and prosperityremain, the Extraordinary Annual Meeting provideda unique platform for leaders from across theregion and the world to discuss their differencesand, following the disruption of the Iraqi war, tobegin planning a more prosperous and securefuture for the Middle East.

For more about the Extraordinary Annual Meetingvisit www.weforum.org/annualmeetingjordan

“The summit demonstrated that the effort to build

a better world must begin with a joint endeavour to

redefine the values that we share. As was discussed

during the summit, peace is paramount to business

in the region and business is paramount to peace.”

Kofi Annan, UN Secretary-General, following the Extraordinary Annual Meeting

The Quartet: Kofi Annan, UN Secretary-General; Colin Powell, USSecretary of State; Igor Ivanov, Minister of Foreign Affairs, RussianFederation, and EU High Representative Javier Solana Madariaga

Andrew Natsios, left, Administrator, US Agency for InternationalDevelopment, and the late Sergio Vieira de Mello, SpecialRepresentative of the UN Secretary-General

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South African President Thabo Mbeki, right, listens to the Chief Executive Officer ofAshanti Goldfields, Sam Jonah, during the last plenary session of the Africa EconomicSummit in June 2003, in Durban.

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Our regional agenda focuses on high priority issuesrelevant to members operating around the world. In close cooperation with our regional partners, we continued to pursue a programme to encourage each region’s economic and social development.

In 2002/2003, the World Economic Forum summits in Europe, the Middle East, Africa, East Asia and LatinAmerica brought together thousands of leaders todefine, discuss and advance the key issues in theirregions. We also convened specific country-relatedmeetings in Brazil and India.

Asia Pacific and ChinaOur East Asia Economic Summit 2002, in KualaLumpur, Malaysia was a launch pad for dialogue,initiatives and commitments on key issues facing the region. The summit’s themes included businesschallenges, competitiveness, diversity, regionalintegration, governance and growth. Seewww.weforum.org/eastasia

To further address the challenges posed in the futureby the increasingly complex nature of Asian businessand diplomacy the summit saw the launch of acommunity of New Asian Leaders. This group ofoutstanding young leaders from business, government,civil society and academia are committed to economicand social development in the region. At a retreat inSeoul in 2003 the New Asian Leaders met to reviewtheir ‘Blueprints for a New Asia’ and discussed theirplans with Korean President Roh Moo-Hyun.

The India Economic Summit 2002 focused oneconomic reforms, trade and investment,

manufacturing industries, financial services, energy and geopolitics. It identified the challenges that thenation must overcome to succeed. The IndiaAdvisory Council continued to promote theachievements and progress made in the country. Its enlargement to include non-Indian members,including European, American and Chinese leaders,has increased the council’s global influence. For further information, visit www.weforum.org/india

In 2002/2003, China remained one of the world’s mostimpressive economic performers, enjoying sustainedgrowth, improved competitiveness and a steadyincrease in foreign direct investment. However,economic activity in the Asia Pacific and China regionwas severely disrupted by uncertainty surrounding thespread of Severe Acute Respiratory Syndrome (SARS),which also had the effect of forcing us to postpone ourChina Business Summit.

In Japan, deflation remained a major problem and the country continued to struggle with the challengesof globalization. The Japanese sub-group of the NewAsian Leaders presented their blueprint for changeat the Annual Meeting 2003. Their suggestionsincluded the deregulation of unproductive industriesto improve competitiveness.

The regional agenda

Encouragingeconomic and socialdevelopment

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“I believe Asia’s future rests upon its ability to harmonize the

region’s diversified characteristics and to develop a sense of

unity and, at the same time, a sense of interdependence.”

Thaksin Shinwatra, Prime Minister of Thailand, East Asia Economic Summit

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The regional agenda

Africa and the Middle EastThe World Economic Forum continued to play a keyrole in building business support for the NewPartnership for Africa’s Development (NEPAD), andits alignment of politicians, business and civil societybehind an ambitious economic and socialdevelopment programme.

The NEPAD’s first projects included the E-SchoolsInitiative, which was launched at the Africa EconomicSummit in Durban with the aim of giving the continent’schildren the skills they need to prosper in today’sinformation society. See www.weforum.org/africa

The Durban Summit also saw the launch of a drugdevelopment collaboration between the Medicinesfor Malaria Venture and GlaxoSmithKline, while theGlobal Alliance for Improved Nutrition announced plansto bring food fortified with vitamins and minerals tosome developing countries. There was a furtherencouraging development at the Annual Meeting inDavos when 50 companies operating in Africa pledgedto follow good corporate governance and promoteethical business practices.

Against a background of war in Iraq and continuedtension between Israel and the Palestinians, theWorld Economic Forum continued to seek solutionsto the region’s social and economic challenges. TheWorld Economic Forum’s 2002/2003 Arab WorldCompetitiveness Report revealed that growthhad stagnated since the 1980s. Noting theimplications of the steep rise in population, the reportstressed the need for job creation and improvededucation systems.

We held the first Arab World CompetitivenessMeeting in Geneva in September 2002. Over 250business and political leaders from the region, as wellas selected multinational corporations and internationalorganizations, took part. During the event, Arabbusiness leaders pledged 20% of their corporatecitizenship or philanthropy budgets to projects aimed at bridging the digital divide between the region andthe world’s most developed nations.

To improve the competitiveness of Arab nations and tobuild a broad-based tier with the West, theExtraordinary Annual Meeting in Jordan became thelaunch pad for the creation of the Arab BusinessCouncil and the Council of 100 Leaders.

Despite such efforts, the difficulties in the region werefurther highlighted in August 2003 when a car bombattack on the UN headquarters in Baghdad killed 22people. In a tremendous loss, Sergio Vieira de Mello,a participant in the Extraordinary Annual Meeting andspecial representative of the United Nations Secretary-General in Iraq, was killed in the explosion.

EuropeAt both the European Economic Summit inSalzburg and our Annual Meeting in Davos webrought together leaders from business, politicsand civil society from the European Union and theaccession countries to discuss the challenges forthe enlarged region. They focused on integrating suchemerging regions as South East Europe intomainstream economic activity. To support this goal weconvened our first South-East Europe Meeting inAthens. Around 300 business and political leadersfrom 31 countries, including seven heads of state,participated. We also sought to involve Russia in thefuture of Europe, promoting dialogue between Russianand European leaders.

2002/2003 was also notable for strengthening linksbetween Turkey and the World Economic Forum.A large delegation took part in the Annual Meeting2003, including the then prime minister Abdullah Guland Recep Tayyip Erdogan, Chairman of the AK Parti,who later went on to become prime minister. Turkeywas also represented at ministerial level at the South-East Europe Meeting.

North AmericaThe US economy remained the main engine forglobal economic growth driven by innovativetechnology, as explored in the World EconomicForum 2002/2003 Global CompetitivenessReport. At the same time that the Iraq war causedtension around the world, the World Economic Forumprovided a vital platform for engagement with the USadministration, enabling global leaders to share afrank exchange of views on the conflict and on socialand economic issues.

“A lot of the world is sceptical about us, believing that

we Africans are not serious about ourselves. We have

to prove that the will to implement the NEPAD is there.”

Thabo Mbeki, President of South Africa, Africa Economic Summit 2003

Thirty one countries, from Croatia to Turkey, wererepresented at the first ever World Economic ForumSouth-East Europe Meeting, held in Athens in May 2003.

On the agenda for around 300 participants werediscussions about the region’s prospects, and anappeal to speed up the process permitting reform-minded Balkan states to apply for EU membership.The meeting included a call to the EU and theinternational community to build on the remarkableeconomic and political achievements in the region overthe past four years. Participants pointed to the factthat the process of European reintegration presentsan opportunity for the region to build a common future– although this depends on regional cooperationunderpinned by international support. A sessionentitled ‘How can the region catch up?’ suggested

that institutional reform isvital for economicsuccess. Greece andIreland were cited as role models for successfulgrowth backed by EU involvement.

Many participants tookthe opportunity to paytribute to Zoran Djindjic,the Serbian PrimeMinister assassinated on 12 March 2003. Balkan leaders pledged to keep hisspirit and vision alive. Zoran Zivkovic, Prime Ministerof Serbia, said that Mr Djindjic had laid the foundationsof many institutions and his European vision would berealized after his death.

Towards European reintegration

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The US demonstrated its commitment to continuingdialogue on both security and the economy at theAnnual Meeting, when Secretary of State Colin Powellled a delegation that included five senior members ofthe administration, among whom was John Ashcroft,Attorney-General, US Department of Justice. At theExtraordinary Annual Meeting in Jordan, Secretary ofState Powell was joined by US trade representativeRobert Zoellick.

The profile of the World Economic Forum remainedhigh in the US following our decision to hold the Annual Meeting 2002 in New York. The success of the Extraordinary Annual Meeting further reinforced the credibility of our mission with business,government, civil society and the media.

Latin AmericaAt the Latin America Business Summit in Riode Janeiro in November 2002, 400 participants frombusiness, civil society, academia and governmentmade key policy recommendations on how LatinAmerica could return to growth.

During the summit more than 100 institutions signedthe Private Sector Declaration, which committedthem to enhancing the institutional environment,improving social conditions and increasing nationalcompetitiveness. Many leaders also called for greateraccess to developed world markets.

Following the election of Luiz Inácio Lula da Silva asPresident of Brazil, the World Economic Forumfocused on the challenges facing the country. TheBrazil Competitiveness Meeting in São Paulo,in June 2003, provided business and other leaderswith an opportunity to meet the new BrazilianGovernment, to assess the main economic andsocial challenges and to develop strategies toimprove competitiveness. The meeting producedrecommendations for the country in the key areasof macroeconomic policies, governance, the legalframework, and technology and innovation.

We continued to expand our engagement with leadersin Latin America and for the first time welcomed fiveregional heads of state to the Annual Meeting 2003 inDavos: Eduardo Duhalde, President of Argentina;Vicente Fox, President of Mexico; Luiz Inácio Lula daSilva, President of Brazil; Alvaro Uribe, President ofColombia and Alejandro Toledo, President of Peru.

For more information on Latin America, seewww.weforum.org/latinamerica

Zoran Zivkovic, Prime Minister, Serbia; Boris Trajkovski,President, FYR Macedonia; George Papandreou, ForeignMinister, Greece; Fatos Nano, Prime Minister, Albania;Stjepan Mesic, President, Croatia, and Milo Djukanovic,Prime Minister, Montenegro, at the Athens summit

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Elderly people are leading longer, healthier and more fulfilled lives, with many choosing tostudy in their later years. But, as a growing number of citizens enter their third age, who willfund their retirement? The World Economic Forum’s Pension Systems Readiness Initiative isassessing how well OECD countries will cope with their ageing populations.

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Task forces and initiatives

An integratedapproach to globalchallenges

The diversity of our membership provides a unique platform for the discussion, coordination anddevelopment of practical projects dedicated toimproving the state of the world. Our task forces andinitiatives form an integral part of this mission byacting as vehicles for sharing knowledge, views andresources among all involved stakeholders andmapping scenarios for decision-makers.

Pension Systems Readiness InitiativeIncreased life expectancy, the impending retirementof the baby boom generation and a fallingretirement age are creating unsustainable pressureson public and private pension systems. Althoughthis is a global problem, many countries areapproaching the issues of ageing and pensionreform in an isolated manner.

The Pension Systems Readiness Initiative bringstogether leaders from the financial services andemployment sectors and other interested bodies,such as senior citizen groups, labour unions andgovernments. As a first step, they will compileextensive cross-country information to assessthe readiness of Organization for EconomicCooperation and Development (OECD) countriesto face the reality of ageing populations and thepressure this will place on their pension systems,economies and future generations. It is intendedthat this analytical tool will shed light on thestrengths and weaknesses of various nationalapproaches and act as a catalyst for change.

For further information on the Pensions SystemsReadiness Initiative, see www.weforum.org

Global Health InitiativeDiseases such as HIV/AIDS, tuberculosis andmalaria kill millions of people every year anddamage the economic and social prospects ofcountries across the developing world. The privatesector is a key player in the fight against diseases.Companies can bring significant resources of skills,implementation and access to at risk populationsthat complement the activities of the public sectorand civil society.

The Global Health Initiative is a collaborationbetween the World Economic Forum’s membercompanies, such key United Nations agenciesas the Joint United Nations Programme on HIV/AIDS (UNAIDS), and the World HealthOrganization’s (WHO) Stop Tuberculosis and RollBack Malaria programmes.

“Almost every global business has something it can and

should contribute to organizations on the front lines of

the global public health crisis.”

Rajat Gupta, Senior Partner, Worldwide, McKinsey & Company Inc., USAw

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Task forces and initiatives

The initiative coordinates the private sectorinteraction with the Board of the Global Fund toFight AIDS, Tuberculosis and Malaria, working toincrease private sector engagement in thesepublic-private partnerships. It seeks to:• Develop tools for businesses to promote

good policy and practices within workforces and communities

• Foster partnerships to develop policies andprogrammes

• Expand corporate advocacy

In 2002/2003, we expanded Global Health Initiativeactivities in individual countries, linking companieswith each other, with non-governmentalorganizations and with governments in the worstaffected nations.

Companies began to play a greater part in thefight against the diseases, developing infrastructureand introducing education for their employees,much of which can be expanded to include entirecommunities. Through the efforts of manycompanies, hundreds of thousands of people nowhave access to life-saving medicines and care.

Achievements of the initiative in 2002/2003included:• Working with the World Bank and UNAIDS to

bring businesses from 15 countries, with highrates of HIV, together in Zambia to sharecorporate best practice in tackling AIDS

• Publishing workplace guidelines on dealing withtuberculosis in partnership with the WHO andInternational Labour Organization. Theseguidelines seek to help companies tackle thedisease and are available online atwww.weforum.org/globalhealth

In 2003/2004 the Global Health Initiative willseek to increase private sector involvement at country-level, complementing such globalprogrammes as the US Presidential EmergencyPlan for AIDS Relief and the WHO strategy toensure three million people have access toretroviral drugs by 2005. For further information, see www.weforum.org/globalhealth

E-learning InitiativeThe Jordan Education Initiative is an e-learning pilotproject, involving the national government andWorld Economic Forum member companies, thataims to deliver e-learning to Jordanian citizens. Itbrings together leaders from the informationtechnology and telecommunications industries toimprove education in the kingdom.

The project provides young people with anenvironment that enables them to pursue their goals through a process of learning and self-determination.

Ninety-six schools are piloting the project inJordan. They will serve as a test bed of howinformation and communications technology canbenefit schools and their pupils. Though focusedon developing education, the plan also offers anopportunity to develop the local informationtechnology industry.

The initiative supports the government vision ofbuilding a knowledge economy by providing lifelonglearning opportunities for all its citizens. For furtherinformation on the E-learning Initiative, seewww.weforum.org

Water InitiativeEnsuring water resources are managed effectivelyis one of the key global challenges. In 2003, theWorld Economic Forum, in association with theUnited Nations Environment Programme (UNEP),launched the Water Initiative to improve the quality and quantity of water for both businessesand communities.

Initiative members include leading businesses, non-governmental organizations and governments whoseek to share best practice and create partnershipsfor the management of water and watersheds (thatis, the area that drains to a common waterway,such as a lake, estuary or ocean).

“We must not only increase public awareness about the

challenges the world is facing in relation to water, but we

must also change the way the water issue is perceived:

from being a driver of conflict to being a catalyst

for collaboration.”

Klaus Töpfer, Executive Director, United Nations Environment Programme,

at the launch of the World Economic Forum Water Initiative, June 2003

The Water Initiative aims to encourage privatesector participation in the maintenance ofwatersheds and to put water management at theforefront of economic development. It will serve asan incubator for public-private partnerships thataddress the importance of watershedmanagement, both for business needs and theenvironment. The initiative will also contribute to abetter understanding of how to structure the costsof environmental services, and establish andpromote best practice in the management ofwatersheds. For more information, seewww.weforum.org/water

Global Greenhouse Gas RegisterIn consultation with companies, environmentalorganizations and governments, the WorldEconomic Forum launched a multistakeholderpartnership to design and operate a globalregister of voluntary corporate greenhouse gasreduction targets. By creating a global emissioninventory and register, where data and commitmentson greenhouse gas emissions can be recorded, weseek to encourage more companies to take earlyaction to measure their emissions and set their ownreduction targets.

The initiative involves partners from the businessand environmental arenas, including WWF (theWorld Wildlife Fund), World Resources Institute,Pew Center on Global Climate Change, WorldBusiness Council on Sustainable Development,World Energy Council, the International EmissionsTrading Association and BrasilConnects. For furtherinformation on the Global Greenhouse Gas RegisterInitiative, see www.weforum.org/ghg

Global Governance InitiativeThe World Economic Forum launched a GlobalGovernance Initiative at the Annual Meeting 2003,to monitor progress towards the ambitiouseconomic, social and environmental goals of theUnited Nations Millennium Declaration.

The initiative involves seven international groups of experts, each dedicated to evaluating the effortand cooperation among the key players seeking to achieve these goals. Targets set out in thedeclaration range from halving the number ofpeople living in poverty by 2015 to finding ways to eliminate war and the dangers posed by thedissemination of weapons of mass destruction.

The Global Information Technology Report is part ofthe World Economic Forum’s commitment to helpingcountries achieve optimum economic performanceand overcome barriers to success.

In 2002/2003, the comprehensive report assessed82 economies around the globe to get a clearpicture of their readiness for the networked world.

Countries were rated according to a NetworkedReadiness Index (NRI). This measures their degree ofpreparedness to capture the benefits of a networkedeconomy according to three factors: marketconditions, including political and regulatory frameworkand infrastructure; the readiness of three stakeholdergroups – individuals, business and government; andthe actual usage of IT.

Finland took first place in the index, reflecting good

use of technology by allthree stakeholder groups.The US slipped to secondplace, due to its lesscompetitive performance interms of connectivity anddiffusion of technology.Singapore was third, butranked higher in terms ofgovernment and regulatorybacking for IT. Brazil andEstonia also scored wellfor government support, while Germany topped theleague for IT usage by businesses.

The NRI was produced in partnership with INSEADand the World Bank Information for DevelopmentProgramme (which addresses obstacles facingdeveloping countries in the information-driven world).

Global Information Technology Report

Finland is leading the way in information technology

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Preparing for a networked society

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Task forces and initiatives

The initiative steering committee convened for thefirst time during the Annual Meeting and will publishits first annual report in 2004. It will assess thesteps being taken by governments, civil society,the private sector and international organizationsto meet the targets, which have the support of189 governments.

Global Corporate Governance DialogueIn line with the global focus on corporategovernance, the World Economic Forum isplanning a series of high-level workshops at itsregional summits and the Annual Meeting. Thesewill take advantage of their setting in differentregions to explore the international and cross-cultural dimensions of corporate governance. Forfurther information on the Global GovernanceInitiative, see www.weforum.org/globalgovernance

Global Corporate Citizenship InitiativeThe World Economic Forum’s Global CorporateCitizenship Initiative is working to increase businessengagement in, and support for, corporatecitizenship. It involves 40 member companies andrepresentatives from other concerned organizations.

In preparation for the Annual Meeting 2003, theinitiative conducted a survey of chief executiveswho had signed the Joint CEO Statement onCorporate Citizenship, which was launched in New York in January 2002.

The survey, which questioned chief executivesfrom 18 industry sectors and 16 countries,showed that companies are treating corporatecitizenship more strategically than in the past andare linking it to business practices. It also foundthat citizenship strategy is now increasingly drivenat board level.

In the survey, 90 per cent of CEOs listed theinternal communication of values and policiesas a key tool in embedding corporate citizenship.Although managing reputation and brand equitywere selected as the most important factors formaking the business case for corporatecitizenship, attracting, motivating and retainingemployees came close behind. For more on theGlobal Corporate Citizenship Initiative, seewww.weforum.org/corporatecitizenship

Council of 100 LeadersThe Council of 100 Leaders seeks to be theforemost community of senior business, political,religious, media and opinion leaders from theWest and the Islamic world who are dedicated to strengthening ties between the two societies.Members of the council met for the first time at the Extraordinary Annual Meeting in Jordan in 2003 to develop a framework for the initiative,which will be formally launched at the Annual Meeting 2004.

The council’s mission is to foster a culture ofrespect and cooperation between the two traditions and so overcome the current tensionand mistrust. It seeks to establish a dialoguethrough a shared commitment to universal valuesand goals, together with a programme of jointaction that will bring clear practical results,transformational change and cooperation. Forfurther information, see www.weforum.org/c100

“Let us try to understand each other. We want peace.

So let us do it together, the Jordanians, the Palestinians,

the Egyptians, all of us – to have a better future for the

children of our region.”

Silvan Shalom, Deputy Prime Minister and Minister of Foreign Affairs of Israel,

at the Extraordinary Annual Meeting

More than 50leading companies,in association withthe World EconomicForum, have unitedto form the Arab Business Council.

The formation of the council at theExtraordinaryAnnual Meeting in Jordan is a

response to the challenges of slow growth, weakinvestment and perceived instability in the Middle East.

The new council’s seven-member executive committeeis ready to work with governments to enhancecompetitiveness in the region, establish constructivedialogue with business leaders in the most developedcountries, and integrate the Arab world more effectivelyinto the global economy.

The council is committed to promoting global bestpractice in the Arab business sector, and has adoptedstringent standards on accounting, corporate socialresponsibility and combating corruption and bribery.

It will also advise the World Economic Forum on issuesof key importance to the Arab world for inclusion in theagenda of the Annual Meeting.

The council will seek to take advantage of theopportunities offered by the new US-Arab FreeTrade Agreement that has been proposed by theUS administration to provide a platform forsustained growth.

Two international private sector meetings are plannedfor the 2003/2004 financial year in order to opendialogue with governments and business sectors in theUS and the European Union.

Arab Business Council

Shafiq Gabr, Chairman of the Arab Business Council

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Global Competitiveness ProgrammeThe Global Competitiveness Programme aims toact as a catalyst for economic policy change, byassisting governments in identifying impedimentsto growth and in designing strategies to achievesustained economic progress. In 2002/2003, wepublished a series of reports and held regionaland national workshops under the GlobalCompetitiveness Programme umbrella.

The programme’s flagship publication, the GlobalCompetitiveness Report, was created by KlausSchwab in 1979. It is the most authoritative andcomprehensive assessment of the comparativestrengths and weaknesses of national economies.In 2002/2003, the report showed that nationsmust improve their governance systems if theyare to remain competitive.

However, the programme’s Global InformationTechnology Report 2002/2003 found that fortuneswere reversed in the IT sector where Finlandranked first in terms of readiness for the networkedworld and the US slipped to second place. It

concludes that Finland is the country most prepared to capture fully the benefits of thenetworked economy.

In 2002/2003, the World Economic Forum publishedthe first Arab World Competitiveness Report. Itshowed how growth in the Middle East has stagnatedsince the 1980s and why, despite its naturalresources, the region has failed to capture a greaterproportion of international trade and capital flow.

The competitiveness sessions and workshopsheld during the Annual Meeting and the regionalsummits provided an opportunity for leaders frombusiness, government, academia, internationalorganizations and civil society to debate keycompetitiveness issues, drawing on informationfrom the reports.

The World Economic Forum also gavepresentations around the world to researchinstitutes and governments keen to strengthentheir economies. For further information, seewww.weforum.org/gcp

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Building growth in the Middle East

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The United States remains the powerhouse of the global economy, according to theWorld Economic Forum’s Global Competitiveness Report 2002/2003.

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The World Economic Forum brings together majorbusinesses to work with all stakeholders in civilsociety to promote economic and socialdevelopment. Our members and partners representall sectors and regions of the global community.

MembersAlthough our members are drawn from the world’stop 1,000 companies, we reserve 35% of placesfor those from the developing world. Our membershelp guide our work, and provide financial andin-kind support to develop our activities. Theybenefit through their involvement in our events,communities and initiatives.

Our members represent a diverse range ofexperience and opinions. They come from 25different industry sectors and are based in everypart of the world. This is why the World EconomicForum is a neutral organization which does notmake public statements on behalf of its members.

During 2002/2003, the following companies wereaccepted as members of the World Economic Forum:Activision Inc., AEA Investors Inc., Aegis GroupPlc, African Rainbow Minerals Gold (ARMgold),Akin, Gump, Strauss, Hauer & Feld LLP, AlshayaGroup, An-Nahar Group, Autostrade SpA, BancaIntesa SpA, Bank of China, Bolsa de Mercadorias& Futuros (BM&F), Brasil Telecom SA, BritishColumbia Lottery Corporation (BCLC), BUPA(British United Provident Association), BusinessObjects SA, CH2M HILL Companies Ltd, China

Netcom Corporation Ltd, Computerland SA,Cotecna Inspection SA, Dow Chemical Company,Dubai Development and Investment Authority,Empresa Periodistica El Mercurio SAP, Eurazeo,Exel Plc, Findus AB, Forrester Research Inc.,France Telecom, Gemplus International SA,Georgetown University, HellenicTelecommunications Organization SA, ICICI BankLtd, Imax Corporation, Industrial and CommercialBank of China, Ingram Micro Inc., Institute ofInternational Finance, Invensys Plc, InvestissementQuébec, Italtel SpA, J. & W. Seligman & Co. Inc.,KT Corporation, La Poste, Lloyd’s of London,Malaysia Airlines, Manugistics Group Inc.,Millennium Pharmaceuticals Inc., MohammedAbdulmohsin Al-Kharafi & Sons WLL, MooreCapital Management, National Commercial Bank,NetJets, Oil and Natural Gas Corporation Ltd,Pacific Basin Economic Council, Petrol Ofisi AS,Portugal Telecom SGPS, SA, QuantumCorporation, Renaissance Re Holdings Ltd, RoyalJordanian Airlines (ALIA), SAS Institute, Sealed AirCorp., Shenzhen Development Bank Co. Ltd,Siemens Corporation, Silver Lake Partners, StarGroup Ltd, Supreme Economic Council, TaiwanPower Company, Telecom Italia Mobile (TIM) SpA,The Bear Stearns Companies Inc., TheShorenstein Company LLC, The TimberlandCompany, Underwriters Laboratories Inc., UnionBank of Nigeria Plc, United States Postal Serviceand the Youssef El-Khereiji Group of Companies.

Entrepreneurshipin the globalpublic interest

Our members and partners

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PartnersOur strategic partners are key companies that areparticularly deeply involved in the activity of the WorldEconomic Forum. They ensure the agenda reflectsbusiness concerns, help launch our task forces andinitiatives and provide people for specific projects, toserve on steering committees or take projectmanagement responsibilities. They also contributesignificant financial resources. There was a specialpartners meeting in spring 2003, to test our strategy.

As of 30 June 2003, our strategic partners were:ABB, Accel Partners, Accenture, Apax Partners, A.T.Kearney, Audi, Bain & Company, Barco, The BoeingCompany, Bombardier, Booz Allen Hamilton, BP, CiscoSystems, The Coca-Cola Company, Deloitte ToucheTohmatsu, DHL, Ernst & Young, HP, IBM Corporation,KPMG, Kudelski Group, McKinsey & Co., Merck & Co.Inc., Merrill Lynch, Microsoft Corporation, Nestlé,PepsiCo, Pfizer, PricewaterhouseCoopers, Sara LeeCorporation, Siemens, UBS and Volkswagen.

Membership developmentThe World Economic Forum’s members encompassnot only the largest companies in the world but alsothose that are regional and industry leaders. Ourmembership criteria remain strict and, during2002/2003, the World Economic Forum not onlywelcomed 91 new members but also refusedmembership to companies that did not meet ourcriteria. Despite the difficult economic conditions weenjoyed the support of 15 new partners in 2002/2003.Several of these were previously members who haddecided to strengthen their ties with the WorldEconomic Forum.

“Stimulating faster economic growth in developing

countries is essential to enable sustained global

economic growth. It is in the mutual interest of developed

and developing nations. It is also key to sharing the

benefits of global growth more equitably.”

International Business Council trade task force statement, March 2003

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Co-chairs of the Annual Meeting: Junichi Ujiie, President and CEO,Nomura Holdings, Japan; Bertrand Collomb, Chairman and CEO,Lafarge, France; Henry A. McKinnell, Chairman and CEO, Pfizer,USA; Philip M. Condit, Chairman and CEO, The Boeing Company,USA (also co-chair of the Extraordinary Annual Meeting)

Four of the co-chairs of the Extraordinary Annual Meeting: PeterBrabeck-Letmathe, Vice-Chairman and CEO, Nestlé, Switzerland;William R. Rhodes, Chairman, Citicorp and Citibank and SeniorVice-Chairman, Citigroup, USA; Khalid A. Alireza, Chairman,Xenel/Saudi Cable Company, Saudi Arabia; Carly Fiorina,Chairman and CEO, HP, USA

Our members and partners

Our communities and constituencies

Communities

A key part of World Economic Forum activity isthe creation of communities of member and partnercompanies. We have developed specific expertise andcapabilities to foster and support these communitiesand to encourage interaction between them wheneverrelevant and worthwhile.

The International Business CouncilThe International Business Council (IBC) consists of100 highly influential, concerned and committed chiefexecutives. It identifies and addresses globally relevantbusiness issues and acts as an advisory body,providing intellectual stewardship to the WorldEconomic Forum. In 2003, the IBC created a taskforce of four members, Niall FitzGerald, Peter Brabeck-Letmathe, Josef Ackermann and Henry A. McKinnell,which was given the responsibility of elaborating itspolicy on trade. Its statement calling for significantbreakthroughs in the Cancun Ministerial Meeting ofthe World Trade Organization was sent to the heads ofstate of the G-8 nations.

At the Extraordinary Annual Meeting in Jordan the IBCreleased a statement on the commitment of businessto the peace process, appealing to governments touse their power and influence to establish peacethroughout the Middle East. IBC steering committeesfor Asia and for healthcare met for the first time inDavos in January 2003 with the aim of giving strategicguidance to the World Economic Forum. Following adebate at its summer meeting, the IBC developed astatement on corporate governance for use bymembers in discussions with officials and regulators.

Industry GovernorsIndustry Governors’ groups are made up of CEOsselected from influential companies within a range ofindustry sectors. These fall under the generalcategories of basic industries, communications andtechnology, consumer goods and health, and financialservices and transportation. The Governors aim toprovide informal, efficient frameworks for an exchangeof opinions on global issues of concern to specificsectors. They provide intellectual stewardship to ourefforts, such as industry-specific initiatives and taskforces and industry-targeted sessions and events.

At the Annual Meeting 2003, the Governors met todiscuss the global issues facing such sectors as themining and metals industries, healthcare andprofessional services. These discussions werepreceded by a series of preparatory meetings toconfirm the Governors’ agenda. Preparatory meetingsfor the chemicals, energy, communications andtechnology, finance, aerospace, travel and tourism,and logistics and transportation sectors were held inGeneva. A similar meeting for the engineering andconstruction industry was held in London and anotherfor the automotive sector took place in Paris.

“We appeal to governments to use their power and to

fully commit to establishing security and lasting peace

in the whole of the Middle East.”

Peter Brabeck-Letmathe, Vice-Chairman and CEO, Nestlé, on behalf

of the International Business Council Trade Task Force, at the Extraordinary

Annual Meeting

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The specialcommitment ofthe businesscommunity

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Our communities and constituencies

ConstituenciesThe World Economic Forum’s constituencies areindividuals and organizations that are drawn fromall sectors of society and represent a rich source ofexpertise and information.

Advisory GroupsOur Advisory Groups range from religious leadersto non-governmental organizations, from academicinstitutions to trade unions. In 2002/2003, a new groupwas created representing philanthropic bodies calledthe Global Foundation Leaders’ Advisory Group. Thepurpose of the Advisory Groups is to assist other keystakeholders in the global economy to engage in,and help shape, World Economic Forum activities.

Forum FellowsIntellectual capital is very important to the WorldEconomic Forum and much of it is provided by ourForum Fellows, a group of around 1,500 scientists andexperts from a variety of fields.

The Forum Fellows are at the cutting edge of theirdisciplines. They contribute ideas, in-depth knowledge,new ways of tackling problems and sound advicethroughout the year. While some fellows are drawninto activities only when their expertise is required,around 50 constitute the core of the community andare heavily involved on a regular basis.

Global Leaders for TomorrowThe Global Leaders for Tomorrow (GLT) programmeis designed to bring together young leaders fromfields ranging from the arts and media to businessand politics – what they have in common is avisionary approach. The object is to provide a freshview of global issues, and to think creatively. Themembers propose task forces and initiatives thatsupport our mission of improving the state of theworld. In 2003, they focused on such issues as accessto water, the characteristics that make strong womenleaders and measuring the impact of philanthropy.

The GLT community’s annual summit was based onthe theme of Leadership: Yesterday, Today andTomorrow and examined how attitudes to leadershiphave changed in the last decade. Many GLTs werealso active participants in the Annual Meeting 2003 in Davos.

This year 100 new members were selected, markingthe community’s tenth anniversary. Many earlier GLTshave gone on to become household names, includingBill Gates, Chairman of Microsoft Corporation, TonyBlair, Prime Minister of the UK, and the composer andsinger Bono.

“There is immense unrest, injustice and inequity in our

world. These circumstances demand the emergence of

a new breed of moral leaders who are committed to

developing innovative, sustainable and tailored

approaches to addressing the most pressing problems.”

Ndidi Okonkwo Nwuneli, Founder, LEAP Africa, Nigeria,

Global Leader for Tomorrow 2003

Jonathan Zapiro, Editorial Cartoonist, South Africa, at the Annual Meeting 2003

Gisèle Yitamben is one of the outstanding individualsin the Schwab Foundation for Social Entrepreneurshipnetwork. Her Association pour le Soutien et l'Appui àla Femme Entrepreneur (ASAFE) provides business

training anddevelopment services,alternative financingand access to e-commerce forthousands of womenentrepreneurs inCameroon, Guinea,Benin, Chad and theDemocratic Republicof Congo.

Yitamben carried out a study for the AfricanDevelopment Bank in 1986, which revealed that womenentrepreneurs in Africa had no access to credit. Theirbusinesses were too small and they could not providecollateral. Moreover, in Cameroon a combination ofdiscriminatory traditional laws and a lack of governmentsupport prevented women’s economic empowerment.

ASAFE strives to enable women entrepreneurs to seizeemerging opportunities, building competencyin management, bookkeeping and marketing. Manyof its 5,000 members have created flourishing micro-enterprises. Using information and communicationtechnology, ASAFE has brought its entrepreneurscloser together and connected them to larger markets.

Social Entrepreneurship

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Technology PioneersThe Technology Pioneers programme has maturedsignificantly since it was established in 2000. Membersof this community represent the cream of global talentin the fields of information technology, biotechnologyand renewable energy. Their aim is to providealternatives to accepted wisdom, as well as to keepthe World Economic Forum informed about emergingtechnologies likely to have an impact on how businessand society operate.

In 2002/2003, 40 new Technology Pioneers wereselected from among the chief executives of the mostinnovative technology companies in the world. Forthe first time, Technology Pioneers formed part of theofficial Annual Meeting programme, and their sessionson IT, biotechnology and energy were well attendedand stimulated lively debate. From 2004, thisheightened profile will be extended to include anannual Technology Pioneer event at a regional summit.

Dialogue with NGOsIn 2002/2003, the World Economic Forum continuedto build strong relationships with non-governmentalorganizations (NGOs) and sought to integrate theirviews into its activities. NGOs played an active part inour regional events, 72 took part in the AnnualMeeting and many were involved in our initiatives andtask forces. For example, WWF has worked with uson environmental issues while Amnesty Internationaland Oxfam contributed to the World EconomicForum’s 2003 Global Agenda Monitor.

We continued to seek constructive dialogue with anti-globalization groups, participating in meetingswith the World Social Forum.

Social EntrepreneursThe Schwab Foundation for Social Entrepreneurshipconsists of about 70 individuals and organizations thatuse innovation to create social value, with wealthcreation as a means to that end.

The Foundation was created by Klaus and HildeSchwab in 1999. It is independent but worksclosely with the World Economic Forum to provide a global platform to promote the benefitsof social entrepreneurship.

Members of this community are united by theircommitment to working for the public good, whetherthrough profit-making or not-for-profit organizations.Social Entrepreneurs are pioneers and innovators.They challenge the usual or ‘inevitable’ and identifypattern-breaking approaches to resolve seeminglyintractable problems, using new processes, services,products or new ways of combining proven practice.

The vast majority of Social Entrepreneurs are educatedprofessionals, such as medical doctors, engineers,scientists, economists, management specialists andlawyers. Their commitment to creating social valuecolours the way they use their expertise and talents.

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Social entrepreneurGisèle Yitamben

Empowering African businesswomen

The Forum blends the best of the private and public sectors to create a unique culture, boosted bythe dynamism and youthfulness of a multicultural staff.

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Our people

The World Economic Forum’s reputation dependson its values, its ability to generate knowledge and strategic insight, and the skills and expertise of its staff.

In 2002/2003, our people continued to reflect the international nature of our organization,with representatives of 32 different nationalities.This cultural diversity was invaluable as we sought to work with our partners and members around the world.

The World Economic Forum continued to bea young, talented organization with the averageage of our people being 36 years. However, itis important to balance the fresh thinking thatcomes with youth with the experience of thosewho have spent many years working in theinternational business and governmental arena.This blend of experience can be seen in thebreakdown in ages of our staff. The skills andhigh qualifications of our staff is clear fromthe fact that two-thirds of the 159 people whowork for the World Economic Forum hold university degrees.

The remuneration policy in 2002/2003 continued toreconcile our status as a not-for-profit foundationwith our aim of attracting the best people.

We also continued to encourage staff to take partin external social, cultural and sporting activitiesprovided there was no conflict of interest.

Our people: a wealth ofdiversity andtalent

Nationality Numbers

American 22Armenian 1Australian 3Belgian 1Brazilian 3British 7Canadian 4Chinese 1Cypriot 1Costa Rican 1Danish 2Dutch 2Finnish 1French 22German 12Indian 1Iranian 1Irish 2Italian 9Ivorian 1Malagasy 1Malaysian 1Mexican 1Moroccan 2New Zealander 1Norwegian 3Polish 1South African 1Spanish 4Swedish 3Swiss 43Thai 1

Nationalities 32

Age Group Numbers

20 to 24 125 to 29 4430 to 34 4735 to 39 2240 to 44 1445 to 49 850 to 54 755 to 59 860 to 64 765 or older 1

Total 159

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Our organization

The World Economic Forum is striving towards aworld-class corporate governance system.

In 2002/2003, we completed the dualimplementation of a new system of corporategovernance, which is rooted in our operational andstrategic approach.

We will continue to review and adapt the WorldEconomic Forum organization to ensure we remainresponsive to the needs of our stakeholders.

The Foundation BoardThe Foundation Board is currently made up of 18 eminent individuals from business, politics,academia and civil society, each serving a three-year term.

The Board acts as the guardian of the WorldEconomic Forum’s mission, values and brand,inspiring business and public confidence through anexemplary standard of governance. This includes:managing the statutes of the World Economic Forumand its institutions; defining the powers of theCommittees and of the Managing Board; appointingnew members; reviewing fund applications; anddetermining and monitoring the execution of theWorld Economic Forum’s strategies.

The membership criteria include integrity, globalvision, leadership experience and participation inworld affairs.

The Foundation Board members for the year2003/2004 are:• Klaus Schwab, Executive Chairman • William I. M. Turner, Vice-Chairman• Josef Ackermann, Vice-Chairman• Kurt Alig, Secretary• Peter Brabeck-Letmathe• Lord Carey of Clifton• Victor L. L. Chu• Flavio Cotti• Michael S. Dell• Niall FitzGerald• Rajat Gupta• Nobuyuki Idei• Caio Koch-Weser• Henry A. McKinnell• Heinrich von Pierer• H.M. Queen Rania of the Hashemite Kingdom

of Jordan• Peter D. Sutherland• Ernesto Zedillo Ponce de Leon

At the Foundation Board meeting of 21 August 2003,members accepted the resignation of Graça Machel,who stepped down due to other commitments.

“Global governance should not be based on rules or

power. It should be based on values.”

Bertrand Collomb, Chairman and CEO, Lafarge, France, at the Annual Meeting 2003

World classgovernance

The Committees of the Foundation BoardThe Foundation Board appoints four committeesfrom among its members:• The Executive Committee prepares the decisions

of the Foundation Board and oversees theManaging Board

• The Audit Committee ensures compliance withall financial, accounting and control processes

• The Evaluation and Remuneration Committeerecommends candidates for positions on theManaging Board and monitors their performance

• The Mission Compliance Committee reviewsForum policies, strategies and activities in lightof its mission

Practice StructureIn 2002/2003 the World Economic Forumorganized its work into three integrated practices.

The Centre for the Global AgendaThe Centre for the Global Agenda (CGA) monitorsand analyses global issues to provide content forthe World Economic Forum’s annual, regional,country and industry meetings. It stimulatesthinking and dialogue by organizing task forcesand other initiatives involving different regions,intellectual disciplines and stakeholders in theworld economy.

The CGA also manages the World EconomicForum’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 GlobalLeaders for Tomorrow. For more information, seewww.weforum.org/globalagendamonitor

The Centre for Global IndustriesThe Centre for Global Industries (CGI) handlesrelations with the World Economic Forum’smembership. The CGI is organized into five broadindustry groupings, to allow the development ofexpertise and special relationships with members,covering: basic industries, communications andtechnology, consumer goods and health, financialservices and mobility industries.

The Centre for Regional StrategiesThe Centre for Regional Strategies (CRS) providesmembers and constituents with a series ofoutcome-oriented summits in markets of majorstrategic interest. It builds regional and nationalcommunities of leaders drawn from business,politics, academia, religion, media and other areasof civil society who share the World EconomicForum’s mission.

The regional summits allow members andparticipants to share, face-to-face, information andinsights on key developments and trends of regionalsignificance. They also give the issues an audiencewhich extends to all stakeholders of global society.CRS works closely with both CGA and CGI, withthe regional summits serving as a platform for theWorld Economic Forum’s global initiatives.

An evolving structureTo better serve our members and constituents, weare evolving the practice structure described above.

In the coming year, we will reshape the organizationto further improve our ability to: build and energizethe top global communities; convene world leadersin the highest level meetings and interaction; serveas the creative force shaping global, regional andindustry agendas, and enable world leaders to takejoint action through global initiatives andpartnerships. The adapted structure will be builtaround groups dedicated to each of theseobjectives and will continue to operate in anintegrated and seamless manner.

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Our organization

The Managing BoardThe Managing Board acts as the executive body of the Foundation. It ensures that activities fulfil themission of the World Economic Forum and acts as itsrepresentative to outside parties. The Managing Boardmembers for the year 2003/2004 are as follows:

Klaus SchwabExecutive Chairman and Founder, aged 65Qualifications: Swiss Federal Institute of Technologyand the Universities of Fribourg and Harvard. Degreesinclude Doctorates in Mechanical Engineering and inEconomics (summa cum laude). Taught businesspolicy since 1969 and has been a Professor at theUniversity of Geneva since 1972. Author of severalbooks, the yearly Global Competitiveness Report(since 1979) and many other publications. Foundedthe World Economic Forum in 1971 as a not-for-profitfoundation, building it into the foremost globalpartnership of business, political, intellectual and otherleaders of society committed to improving the state ofthe world. Recipient of numerous academic andinternational and national honours for initiativesundertaken in the spirit of entrepreneurship in theglobal public interest and for peace and reconciliationefforts in several regions.

José María Figueres* Senior Managing Director, aged 49Qualifications: Bachelor’s Degree in Engineering in1979. 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 CentralAmerica, 1980-84. President of the San CristobalAgroindustrial Group from 1984-87. Minister of ForeignTrade for Costa Rica, 1987-88, becoming the Ministerof Agriculture from 1988-90 and President of CostaRica from 1994-98. Joined the World Economic Forumin 2000 as Managing Director. Additional posts held:President of the Board of Leadership in Environmentand Development (LEAD), Member of the Board ofDirectors: World Resources Institute (WRI), StockholmEnvironment Institute (SEI).

Philippe Bourguignon**Senior Managing Director, aged 55Qualifications: Master in Economics, University ofAix-en-Provence and a postgraduate diploma fromthe Institut d'Administration des Entreprises, Paris.Positions held: Set up vacation hotels in Africa andthe West Indies, 1971-74. He worked for AccorGroup for 14 years: 1974-76, Vice-President,Development, Asia & the Middle East; 1978-84,Executive Vice-President, North America; 1984-88,President, Accor/Pacific. In 1988 he joined DisneyDevelopment Co., Los Angeles; 1992, promoted toPresident, Euro Disney, Chairman and CEO, EuroDisney and Executive Vice-President, Walt DisneyCompany Europe. He was Chairman and CEO ofClub Meditérranée 1997-2003. In August 2003 hebecame Managing Director of the World EconomicForum. He is a board member of eBay, Dexia andAspen-France Institute.

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

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Frédéric SicreManaging Director, Regional Strategy, aged 39Qualifications: BA in Literature, Villanova University,Philadelphia, Pennsylvania, USA. Positions held:managing a communication centre within the NATOorganization, Germany. Programmer, NewsReporter for Radio Geneva Information and KTFMradio stations, 1982-84. Joined the WorldEconomic Forum in 1989. In 2000, he becameManaging Director with direct responsibility for theCentre for Regional Strategies.

Rick Samans*** Director, Global Issues, aged 45Qualifications: BA in Economics and French from TuftsUniversity and a Masters in International Affairs fromColumbia University. Positions held: Corporate LendingOfficer, Credit Lyonnais USA, New York from 1981-84.Legislative Assistant to a member of the HouseCommittee on Ways and Means from 1985-88.Professional Staff Member and Senior LegislativeAssistant to the Chairman, Senate BankingCommittee; International Affairs Fellow, Council onForeign Relations, London and Washington DC from1988-91. Associate Director and Staff Director for theSubcouncil on Capital Allocation, CompetitivenessPolicy Council, 1993-96. Economic Policy Adviser tothe Senate Minority Leader from 1996-99. SpecialAssistant to the US President, for InternationalEconomic Policy, 1999-2001. Joined the WorldEconomic Forum in 2001 as Director, Global Issuesand as an Associate Member of the Managing Board.

André SchneiderManaging Director, Chief Operations Officer, aged 44 Qualifications: Classical Orchestra Musician; Diploma,Richard Strauss Konservatorium, Munich. PhD inComputer Science, University of Geneva. Positionsheld: the Philharmonic Orchestra of Berlin; theStaatsheater Kassel; the Symphony Orchestra of theRadio Saarland; the Lucerne International FestivalOrchestra. Researcher in parallel computers for theEuropean Community; various positions held with IBM,including: Product Developer; Consultant and Principal,IBM Consulting Group; Consultant for variouscompanies and organizations; Speaker on IT-relatedtopics. Joined the World Economic Forum in 1998,appointed Director of Knowledge Management andan Associate Member of the Managing Board in 2000and a member of the Managing Board fromJanuary 2003.

Michel Ogrizek***Director, Communications, aged 56Qualifications: Medical Doctor, University of Paris,1974. Positions held: Chief Medical Officer at theFrench Ministry of Cooperation from 1975-82.Research Associate in the Department of CulturalAnthropology and post-doctoral studies at Berkeley,1982-83. Medical and Public Affairs Director, AfricaRegion and Medical Director, Canada, at WarnerLambert from 1983-87. Médecins Sans Frontièrestrainer. From 1987-91, Director, Burson-Marsteller,France. President and CEO, Hill & Knowlton, France,and Head, Eurosciences, from 1991-95. From 1995-97, President and CEO for Europe and Boardmember, Edelman Public Relations Group. GlobalHead of Corporate Relations, Unilever from 1997-2000. Global Head, Marketing & Communications andManaging Director, UBS Warburg from 2000-02.Joined the World Economic Forum in mid-2002 asDirector of Communications and as an AssociateMember of the Managing Board.

*Appointed Co-Chief Executive Officer in October 2003.

**Joined the Managing Board in August 2003 and appointed Co-Chief Executive Officer in October 2003.

***Appointed Managing Director in August 2003.

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Our organization

Information technology and knowledge managementIn 2002/2003, the World Economic Forum continuedto develop its IT resources, for the benefit of itsmembers and staff and the global public.

At the Annual Meeting 2003, to enhance integration,interaction and knowledge sharing, participants wereagain supported by the latest technological systems,provided in partnership with leading IT companies.

Building on the IT of previous Annual Meetings,innovations for 2003 included:• Improved ‘smart’ security badges. The badges,

which carry a microprocessor and antenna thatenable communication with the main computingsystem, were this year overprinted with differenttypes of ink. This visual security complementedthe electronic security provided by the chip

• Consolidating all Annual Meeting information into a simple, easy-to-use platform on the WorldEconomic Forum website

• Tablet PCs being introduced in the members’lounges, to complement 90 fixed electronicterminals or ‘kiosks’

• An enhanced ‘Davos Companion’. This year, thishand-held, iPAC version of the printedprogramme, participants’ booklet and guide,included an integrated LAN card, making it thinnerand lighter. In another new departure, following theAnnual Meeting, almost one third of the 2,000companions distributed were donated to aidprojects in Uganda and India.

In June, the World Economic Forum faced thechallenge of providing IT resources, at short notice, for the very different environment of the ExtraordinaryAnnual Meeting in Jordan. The task was executedsuccessfully, with 150 PCs flown to Jordan, to establish the required IT infrastructure.

Aside from these high-profile events, we continuedto enhance our all-year-round IT offering. Membersbenefited from such additional services asimproved private spaces for key virtualcommunities, including the IBC and Governors,and more detailed online information.

To further improve our transparency, we alsoincreased the information on our public website. For example, we provided more information on our Global Competitiveness Programme reports and on our initiatives.

Sharingknowledge

“I remember the CEO of General Electric saying if investors

wanted a financial report the size of the New York City phone

book, then that’s what they would get. Most of us don’t want

that amount. What we want is a small amount of information,

but we want good information.”

Constance Ford, Economics Editor, The Wall Street Journal, at the Annual Meeting

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The number of visits to our sites continued to rise. In January 2003, there were one million page views, up from 250,000 the previous January. Over the fullyear, there were seven million page views, over onemillion visits.

Looking forward, we will continue to develop our IT capability, to enhance the experience of everyonewho interfaces electronically with the WorldEconomic Forum.

CommunicationsIn 2002/2003, extensive – and largely positive –media coverage brought World Economic Forumactivities to millions of people around the globe.

The Annual Meeting and the Extraordinary AnnualMeeting were the key focus of media attention. For example, live BBC World broadcasts from bothmeetings opened the events to almost half a billiontelevision viewers and radio listeners. The peace andreconciliation summit in Jordan attracted significantnumbers of both the Israeli and Arab media, withsatellite television network Al-Jazeera broadcastingthree hours of coverage per day.

This level of media attention is due to theinternational stature of our membership and thesignificance of topics and initiatives. It also reflectsthe World Economic Forum’s commitment tobuilding partnerships with the world’s media. Twentyper cent of participants at our events are editorsattending not, as elsewhere, as reporters only but as full and active stakeholders.

In 2002/2003, for the first time, the media presenceincluded many of the world’s leading editorialcartoonists. As both journalists and artists, theywield a peerless impact and influence on theiraudiences, reflecting and even shaping publicperception of global leaders and issues. Theybrought a unique perspective to our efforts toengage dialogue during this year’s Annual Meeting,Extraordinary Annual Meeting and regional summits.

Our close working relationship with the media acrossthe globe demonstrates our openness andtransparency. Ongoing media programmesthroughout the year reinforced this relationship whichis based on trust and credibility. Notable internationalpartnerships with press groups included editorial cooperation with Newsweek at the global level andTime in Europe, the Middle East and Africa.

PartnershipsThe World Economic Forum also seeks partnershipswith like-minded institutions. It has, for example,NGO consultative status with the Economic andSocial Council of the United Nations and worksclosely with the Prince of Wales InternationalBusiness Leaders Forum and the World BusinessCouncil for Sustainable Development.

Online World Economic Forum staff hard at work at the Annual Meeting 2003 in Davos

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Our financialresults

In 2002/2003, despite a tough economic andgeopolitical climate, the World Economic Forum’sfinancial base remained robust.

By keeping costs below last year, we partly offset alower level of incoming revenue. The latter followedthe SARS-related cancellation of the planned AsiaEconomic Summit and the postponement of theChina Business Summit; the straitened finances ofsome of our members and, following the exceptionalcircumstances of the Annual Meeting 2002 in NewYork, a return to the customary participation levels atthis year’s event.

Financial policyThe World Economic Forum’s financial policystates that membership fees should coveroperational costs, that events are funded throughcost contributions and that projects are supportedby income from partnership contracts.

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

The World Economic Forum makes no payments topolitical personalities, parties or other organizationsand avoids involvement in internal politics.

AuditorsThe World Economic Forum’s financial results areaudited by PricewaterhouseCoopers who examinethe balance sheet and accounts. The annualreport, as well as all institutional documents, aresubmitted to the Swiss Federal Government, whichacts as the supervisory body of the Foundation.

Total Income 1998 – 2003 figures in Swiss francs

1998/ 1999

1999/ 2000

2000/ 2001

2001/ 2002

2002/ 2003

51,3

06,0

02

61,1

00,6

42

63,8

06,0

52

72,1

95,4

53

66,4

54,7

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The financial year’s figures reflect the special partnership nature ofthe Annual Meeting 2002 in New York and the SARS-relatedcancellation/postponement of two significant Asian summits in 2003.

Year 1998/1999 1999/2000 2000/2001 2001/2002 2002/2003

Total income* 51,306,002 61,100,642 63,806,052 72,195,453 66,454,727

out of which

members’ fees 20,915,531 22,106,920 23,588,125 24,965,367 25,530,325

participation fees 26,972,981 21,465,398

partnership 18,946,940 17,390,452

Total expenditure 50,380,441 59,416,135 63,556,294 69,077,008 66,454,522

out of which

personnel costs 27,097,659 26,584,768

office costs 10,642,445 8,360,352

activity-related costs 31,336,904 31,509,401

Surplus to be

added to the

Foundation capital 925,560 1,684,507 249,759 3,118,445 205

Foundation capital 7,062,041 8,746,549 8,996,308 12,114,753 12,114,958

Total staff

Full time 68 81 125 139 130

out of which are seconded

by Forum members 4 4

Part time 24 22 22 28 28

* all key figures in Swiss francs

Key figures

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The World Economic Forum is the foremost globalcommunity of business, political, intellectual and other leaders of society committed to improving thestate of the world.

Our mission is best realized through activities which promote economic and social development.We believe that economic progress without socialdevelopment is not sustainable, while socialdevelopment without economic progress is notfeasible. Our motto is thus ‘entrepreneurship in the global public interest’.

In addition to convening world leaders, the Forum iscommitted to involving them in living communities ofcommon interest and purpose. The Forum ensuressubstance in the form of strategic insights and, whererelevant, platforms for joint action. To carry out itsmission, the World Economic Forum has developedan integrated value chain by involving world leaders in communities, inspiring them with strategic insightsand enabling them through initiatives.

Our vision for the World Economic Forum is threefold.To be:

• The foremost organization which builds andenergizes leading global communities

• The creative force shaping global, regional andindustry strategies for its communities

• The catalyst of choice for its communities whenundertaking global initiatives to improve the stateof the world

The World Economic Forum enjoys unique globalpositioning by recognizing and responding to twonew developments:

• The world’s key challenges cannot be met bygovernments, business or civil society alone

• In a world characterized by complexity, fragilityand ever greater synchronicity, strategic insightscannot be passively acquired. They are bestdeveloped through continuous interaction withpeers and with the most knowledgeable peoplein the field (learning communities)

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Our mission andvalues

The Forum’s Global Health Initiative helps mobilize the private sector in the fight againstHIV/AIDS. Pictured, Ian Robertson, BMW South Africa’s managing director, is publiclytested at an on-site medical facility, to encourage employees to learn their HIV statuswithout fear of discrimination.

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Contact details:

World Economic Forum91-93 route de la CapiteCH-1223 Cologny/GenevaSwitzerland

Telephone +41 (0)22 869 1212Fax +41 (0)22 786 2744e-mail: [email protected]

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