The Davos conference brings together the world’s elites to try to make the world a better place. But according to some current and former employees, the leader of the organizing body behind Davos fosters a toxic workplace. WSJ’s Shalini Ramachandran discusses her investigation into the World Economic Forum and the impact of a recent anonymous whistleblower letter. Annie Minoff hosts. Sign up for WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What is Davos and why is it significant?
Hey, it's Jess. Annie Minoff, one of our senior producers, is going to be stepping in to do some hosting this summer while Ryan is out on leave. Enjoy. Every year, a ski resort nestled in the Swiss Alps hosts the world's biggest party for the rich and powerful. Some people call it the Magic Mountain. Most people know it better as Davos.
So Davos is an alpine city in Switzerland. That's our colleague Shalini Ramachandran. It's the site of this annual meeting that brings together the planet's power brokers from like morning to past midnight. Meetings over coffee and cocktails and fondue and there are thousands of CEOs and billionaires.
You'll run into billionaire George Soros. His Majesty, King Abdullah II of Jordan.
queens and kings and presidents who descend on this place.
Send hello to everyone in beautiful Davos.
You know, you can run into Al Gore in the hotel bar or Bill Gates near the metal detectors or Sting in the elevator. And it's about networking and it's about making deals and talking about big ideas.
Over the years, the Davos Conference has taken on big topics. Peace in the Middle East, climate change, gender equality, And they've touted big wins. Organizers have taken credit for major diplomatic breakthroughs, including averting conflict between Greece and Turkey and bringing together the leaders of East and West Germany after the fall of the Berlin Wall.
To improve the state of the world. That was the tagline, you know, to make the world a better place.
But as Shalini discovered, there was a lot more happening behind the scenes. She and our colleagues have been investigating allegations of sexism, racism, and harassment at the organization that runs Davos, an organization called the World Economic Forum.
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Chapter 2: What controversies surround the World Economic Forum?
And now, after a fresh round of allegations, a major leadership shakeup is underway.
The World Economic Forum is now investigating its founder, the top boss, and now he's leaving under a cloud of suspicion and with allegations hanging over him.
Welcome to The Journal, our show about money, business, and power. I'm Annie Minoff. It's Wednesday, April 30th. Coming up on the show, the boardroom drama and leadership crisis, rocking Davos. The World Economic Forum, the nonprofit that runs the Davos Conference, has been around for more than half a century.
Today, it has over 800 employees and takes in hundreds of millions of dollars, much of it from partner companies that pay big bucks to attend Davos. But the organization started small.
So, Klaus Schwab founded the World Economic Forum in 1971, and he started it as something called the European Management Forum.
At the time, Klaus Schwab was a German engineer and economist, broad-shouldered with glasses and a dour expression.
And he kind of experienced the post-World War II reconstruction timeframe, and he became a professor.
Schwab's time growing up in Europe after the war shaped his views on the power of global cooperation to rebuild economies. And that experience gave him a big idea.
So I felt I should create a platform where Europeans, business leaders, government leaders, could come together and talk about their future. That was the idea.
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Chapter 3: What allegations have emerged from the workplace at the Forum?
Chapter 4: Who is Klaus Schwab and what is his role?
And so the Davos meeting was born. These days, it hosts 3,000 leaders from over 130 countries. And as Davos' importance increased, so too has Schwab's. Schwab is 87 now, and not exactly a household name. But his role at the top of the World Economic Forum has made him one of the best-connected people in the world, with a Rolodex that includes everyone from royals to rock stars.
Klaus Schwab became the ultimate powerful person, this uber connector of all these power players, the CEOs, the queens, the presidents, the prime ministers.
But as Schwab and his organization worked to shine a light on the world's problems, Shalini started hearing about problems within the forum itself.
What I learned was, you know, there's a dark side to this organization behind these glitzy Davos annual meetings. We heard a lot of examples of sexual harassment, pregnancy related discrimination and racial discrimination. Based on our reporting, there's at least two instances of managers using the N-word.
One former employee, a Black woman, described an incident in which a boss, brandishing matches, asked if he could set her wig on fire.
She reported the boss to Human Resources and nothing happened.
The Forum told the Journal last year that they weren't aware of the allegations. The employee eventually chose to leave the organization. And then there was a story an employee told about a strange encounter in 2010 during a flu vaccination drive.
Based on our reporting, a senior executive who in recent weeks has left the organization pretended to be a medical doctor when a young female staffer showed up to a flu vaccination drive. And he asked her medical questions and responded affirmatively when she asked if she should take off her shirt and requested she move her body in different positions.
According to a complaint sent to Schwab and forum leaders, the woman only realized she'd been duped when the real doctor walked in. According to the complaint, the manager later brushed it off as a joke.
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Chapter 5: What dark side issues have been reported at the World Economic Forum?
Chapter 6: What is the impact of the recent leadership changes?
At the time, Klaus Schwab was a German engineer and economist, broad-shouldered with glasses and a dour expression.
And he kind of experienced the post-World War II reconstruction timeframe, and he became a professor.
Schwab's time growing up in Europe after the war shaped his views on the power of global cooperation to rebuild economies. And that experience gave him a big idea.
So I felt I should create a platform where Europeans, business leaders, government leaders, could come together and talk about their future. That was the idea.
He loved this concept of a multi-stakeholder participation, which basically means governments and businesses and nonprofits work together to accomplish important goals. He believed that when these people work together, problems can be solved faster.
And so the Davos meeting was born. These days, it hosts 3,000 leaders from over 130 countries. And as Davos' importance increased, so too has Schwab's. Schwab is 87 now, and not exactly a household name. But his role at the top of the World Economic Forum has made him one of the best-connected people in the world, with a Rolodex that includes everyone from royals to rock stars.
Klaus Schwab became the ultimate powerful person, this uber connector of all these power players, the CEOs, the queens, the presidents, the prime ministers.
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Chapter 7: How has the Forum's mission conflicted with its internal culture?
But as Schwab and his organization worked to shine a light on the world's problems, Shalini started hearing about problems within the forum itself.
What I learned was, you know, there's a dark side to this organization behind these glitzy Davos annual meetings. We heard a lot of examples of sexual harassment, pregnancy related discrimination and racial discrimination. Based on our reporting, there's at least two instances of managers using the N-word.
One former employee, a Black woman, described an incident in which a boss, brandishing matches, asked if he could set her wig on fire.
She reported the boss to Human Resources and nothing happened.
The Forum told the Journal last year that they weren't aware of the allegations. The employee eventually chose to leave the organization. And then there was a story an employee told about a strange encounter in 2010 during a flu vaccination drive.
Based on our reporting, a senior executive who in recent weeks has left the organization pretended to be a medical doctor when a young female staffer showed up to a flu vaccination drive. And he asked her medical questions and responded affirmatively when she asked if she should take off her shirt and requested she move her body in different positions.
According to a complaint sent to Schwab and forum leaders, the woman only realized she'd been duped when the real doctor walked in. According to the complaint, the manager later brushed it off as a joke.
The woman complained to human resources. Immediately after she complained, she began noticing her work was constantly criticized by her boss, despite positive feedback from external stakeholders. And within months, the forum fired her.
The Forum told the journal last year that the incident was a misunderstanding. Documents show that the executive was reprimanded and had his bonus reduced. Some current and former employees told Shalini about alleged incidents involving Schwab himself. One woman described a meeting in which Schwab propped his leg up on her desk with his crotch in front of her face.
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