[Nasional-e] Can we trust 'Davos man'

Mon Jan 27 23:48:04 2003

EDITORIAL

Can we trust 'Davos man'?

The rich, the powerful and the famous last week descended once again on the
Swiss village of Davos for the annual meeting of the World Economic Forum
(WEF). This year, the assembled luminaries pondered the loss of "trust" that
has sapped institutions worldwide. The question is a vital one. Of the many
obstacles that impede steps toward a better future, the lack of faith in the
instruments of progress may be the most important.

Trust is internalized in most business, political and social processes.
There are mechanisms to reinforce trustworthy behavior -- no one is immune
to temptation -- but there is a working presumption of trustworthiness.
Sadly, that presumption is eroding.

Scandal is one culprit. Barely a day goes by without some new revelation, be
it in politics or business. The collapse of businesses, some venerable
institutions, has rocked public confidence. The scale of recent failures has
convinced many that the problems are systemic, rather than individual cases.
The taint has spread beyond the executive suite to infect other
institutions -- the legal and accounting professions, bureaucrats and
politicians -- that were thought to serve as checks on malfeasance.

Another factor is globalization. The networked world has stretched the
fabric of communities. Companies are no longer tied to specific geographic
areas, and individual loyalties have been reshaped in the process. Behavior
in one part of the world has its impact in another. Externalities are
growing, though they are becoming harder to see. Trust is born of
familiarity and loyalty -- and loyalties are being refocused and defused.

Then there is the role of the media. While the media can claim that they
only provide the buyer with what he or she demands, the steady diet of
spectacle and skepticism has contributed to the dwindling faith in
institutions. Shrinking attention spans and increasingly jaded audiences
have spawned a culture that rewards the biggest and most colorful
personalities and news. Context is vanishing and with it the nuance that is
needed to govern effectively. In this world, only rhetoric counts -- making
promises, not keeping them.

It is no surprise then that global public-opinion polls show that trust in
individuals and institutions is declining around the world. A WEF survey
revealed that 48 percent of people polled had little or no trust in global
companies; 52 percent expressed skepticism. Political leaders are also under
a cloud. The WEF poll shows that a majority of citizens across 15 countries
surveyed do not agree with the direction in which the world is moving, a
significant increase in half the countries polled compared to a year ago.

The irony is that in many ways the world is improving. Using World Bank
criteria, the number of people living in poverty in developing countries has
dropped from 56 percent in 1950 to 9 percent by 2000. According to Freedom
House, in 1972 1.3 billion people, some 35 percent of the global population,
lived in "free" countries. Today, the number has more than doubled: 2.7
billion people, 44 percent of the total, are free. Citizens have access to
more information and the right to demand accountability from their
governments. The current generation has economic and social opportunities
and options that its predecessors could only dream about.

The overall improvement is often hard to see. Much more glaring are the
failures -- made even more apparent by the lofty rhetoric and the
declarations that mark the international meetings that seem to occur with
increasing frequency. The international community has declared that by 2015
it will halve the number of people living in poverty, ensure universal
primary education, halt and reverse the spread of HIV/AIDS and other major
diseases, and halve the number of people suffering from hunger. In addition,
it will guarantee the human rights of all citizens, protect the environment
and implement arms control and disarmament treaties. Given these goals, it
is no surprise that trust has diminished.

To help remedy the situation, the WEF last week launched the Global
Governance Initiative. It will monitor progress toward implementing the
goals laid out in the United Nations Millennium Declaration and other
international documents. The initiative will publish an annual report on the
work of meeting targets in the fields of cutting poverty and hunger,
combating disease, providing education, protecting the environment and
implementing arms control. The initiative will highlight successes to be
emulated and mistakes to be avoided.

The WEF initiative recognizes that rebuilding trust will be a slow process.
It will require input from all groups -- from the worlds of politics,
business, religion and culture. In fact, the only way it can succeed is with
the active participation of all individuals. Most of us may never go to
Davos, but we are still a part of the Davos process.