Yoshito Hori, president of GLOBIS University, managing partner of GLOBIS Capital Partners, shares his views from an entrepreneur's perspective.
The Swiss Railway, clad in red, pulled into the wintry train station. I boarded the train and took in the view of the landscape from the train window. I was endlessly entertained by the passing scenery of Switzerland. As I looked at the panorama, I was filled with a sense of accomplishment that I had completed everything I set out to do at this year’s WEF Davos Meeting.
I want to write about three issues that stuck with me at Davos.
1. The power shift to Internet companies and the start of technology bashing
One impression I came away with is that the “stars” of the Internet world were on the defensive. Up to now, Internet entrepreneurs had been praised for their feats. But it appears things have changed as the negative impact of the Internet is being brought to light. The current trend seems to be that Internet entrepreneurs feel they have to vindicate themselves.
In my column, Day two of the World Economic Forum Annual Meeting 2015 in Davos - “The conference is changing”, I discussed how trust in the IT sector has dropped for the first time. A broad range of issues have arisen, such as accusations of tax evasion by Apple, crimes and legal violations by Uber drivers in different countries, the hacking attack on Sony, the court case against Google regarding the “right to be forgotten”, suspension of Google Glass sales due to privacy infringement concerns, the existence of the Dark Web being secretly utilized by terrorists, and the problem of protecting personal data.
Marc R. Benioff, CEO of salesforce.com, Marissa Mayer, CEO of Yahoo!, Sir Tim Berners-Lee who is the inventor of the World Wide Web, and an EU Commissioner participated in “In Tech We Trust,” which was moderated by Nik Gowing.
In the following session at the main hall, Microsoft CEO Satya Nadella, Facebook COO Sheryl Sandberg, and Google Chairman Eric Schmidt spoke on “The Future of the Digital Economy.”
The key topic discussed in these sessions was the issue of personal information and data use.
The Davos Meeting is a place of power clashes. Politicians have political power, the media has communicative power, and the flow of capital is controlled by banks, pension funds, private equity and venture capital firms, as well as the central banks and the IMF which govern these institutions. Universities have at their disposal the power of intellectual research and their vast alumni networks, while NGOs leverage their presence by working for good causes to help the disadvantaged and contribute to the betterment of society. Added to all this are Internet companies which have rapidly risen to power in recent years. It is my understanding that there has been a rapid power shift to Internet companies, a phenomenon that began to be questioned by society at large, as was demonstrated at this year’s Davos.
The conference is where the sparks began to fly between these Internet companies and other traditional power holders. It was indeed a tide-turning moment. Fadi Chehade, the CEO of ICANN, talked with a strong sense of crisis: “One of the main agenda items for the United Nations General Assembly in September 2015 is “Internet and Society.” Society overall has become critical of the Internet. If the industry does not step forward to make its own rules, then governments around the world will likely begin to implement regulations and restrictions.” However, I think that most Internet companies do not share this same sense of urgency.
I will keep my close watch on the impact of society’s criticisms against Internet companies.
2. Switch from threats of the state to threats from a “mysterious” network
This year’s discussions dealt with topics such as climate change, the euro, ISIS, terrorism, hackers, and the Ebola virus. Naturally, Russia continues to pose a risk but this was something to be expected. A key aspect of these issues is that they are difficult to solve even with inter-governmental cooperation. In other words, these problems have exposed the limitations of the state.
ISIS is one such problem. No matter what decisions politicians make, it always turns out ugly. That is why no country would want to become involved. If possible they would rather turn a blind eye. However, this will only exacerbate the situation. A decision to “fight” would not receive public approval. People don’t want their country to be involved for fear of becoming affected themselves. Such was what happened in the Japanese hostage situation. Negotiating with terrorists is ugly but then choosing not to negotiate is also ugly. Paying ransom and succumbing to terrorist demands will definitely not address the root causes of the problem. In contrast, it is likely to further reinforce terrorism and will provoke continuous terrorist attacks.
In other words, unless ISIS is eradicated, we are likely to see more of similar hostage situations going forward. The only option is to fight against ISIS and ultimately eradiate their network. To do this, the US and other developed countries will have to closely work together with the Arab nations. Unfortunately this choice is also likely to take an ugly direction so there is unwillingness on the part of these countries. This is why ISIS can do what it likes. The question is, if the world chooses to fight, is it okay for Japan to be on the sidelines?
The climate change is another difficult issue to tackle as it requires cross-border decision making. The same holds true for the euro crisis and the Ebola epidemic, for which cross-border cooperation is essential. But the cooperation of governments alone is not enough. To form and execute partnerships requires public support. Public opinion is key in a democracy.
Public opinion tends to be risk-averse. President Obama won the election by supporting the withdrawal of US troops from Iraq. However, this ultimately paved the way for the rise of ISIS. Public reluctance to face tough issues is definitely not conducive to cross-border problem solving. Today public opinion is formed through complex social interactions. The mass media alone can no longer shape public opinion due to the advent of social media. This has made it even harder to tackle difficult and intractable problems that are having major global impacts.
Going forward, there will be an increased likelihood of us being exposed to threats posed by “mysterious” networks that know no national borders. Postponing to face these obscure sources of threat will only result in further strengthening these threats. International and transnational collaborations are crucial in this predicament.
3．The “Galapagos phenomenon” of the Japanese media and people
What was the extent of the Japanese media’s coverage of the Davos 2015 Meeting? How much interest do the Japanese people have in the conference?
Almost all the world’s leaders, its movers and shakers, are in Davos at this time of year. Heads of international organizations, the Secretary-General of the United Nations, representatives from the World Bank and the IMF - almost everybody. Heads of states and leading political figures were also in attendance, including the German Chancellor Angela Merkel, the French President Francois Hollande, the Italian Prime Minister Matteo Renzi, the Chinese Prime Minister Li Keqiang, the US Secretary of State John Kerry, Egyptian President Abdel Fattah el-Sisi, South African President Jacob Zuma, Turkish Prime Minister Ahmet Davutoglu, and the King of Jordan Abdullah II. Furthermore, almost all central bank governors and leaders of major private-sector companies were also present. Prominent figures from Japan, including three cabinet ministers, also flew in for the conference.
Why do these people attend? Topics at the forefront of the world agenda are addressed here and decisions are made on various issues. This information is then communicated around the world. Not attending this meeting would be putting one’s self at a disadvantage.
Worldwide media outlets, including the Wall Street Journal, the Financial Times, CNN, and BBC World News, all focus on the goings-on in Davos at this time of the year. However, coverage by the Japanese media was minimal. In 2014, many Japanese media reporters attended the conference because Prime Minister Abe delivered the keynote address. But little attention was paid to anything other than the Prime Minister’s speech.
I started writing this column because I felt that if the Japanese media wasn’t going to provide essential coverage of important topics addressed here then I had to do it myself. I try to post the columns on the same day I write them. However, I didn’t receive that big a response to the columns I posted on NewsPicks. Japan’s attention was focused on the ISIS hostage crisis. There was little-to-no interest in the globally important Davos Forum.
Even on NewsPicks, which attracts an intellectual crowd, many questioned the significance of the Davos Conference. The impact of the “Galapagos phenomenon” in Japan is of great concern for me. Nonetheless, I have no intention of giving up and will continue to write this column. That is why I am writing this, even now, on my flight home from Zurich.
Anyhow, this is the eighth time I have participated in the Davos Meeting. I need to take a break from all this serious talk and lighten things up with a few videos and pictures.
● Japan Night and GLOBIS Night pictures. You can see what a fun night it was
● View from the Swiss Railway on the way to the World Economic Forum Annual Meeting 2015 in Davos (produced by GLOBIS)
●World Economic Forum Annual Meeting 2015 in Davos by Mr. Sven Van Stichel (GLOBIS employee) No. 1
● World Economic Forum Annual Meeting 2015 in Davos by Mr. Sven Van Stichel (GLOBIS employee) No. 2
●Video of GLOBIS Night! 2015
This is the end of my report on the World Economic Forum Annual Meeting 2015 in Davos. Thank you for taking time to read my columns. I look forward to seeing you all at next year’s Davos.
January 25, 2015
Written during the flight to Narita
Davos Conference participation report: List of previous blogs
■Davos Conference 2015
World Economic Forum Annual Meeting 2015 1）My First Day in Davos
World Economic Forum Annual Meeting 2015 2）The tide is turning at Davos
World Economic Forum Annual Meeting 2015 3）Davos is a massive communication base
World Economic Forum Annual Meeting 2015 4）Scenes from Japan Night and GLOBIS Night
World Economic Forum Annual Meeting 2015 5）The advent of a Japanese chairman; and he takes the podium!
■Davos Conference 2014
World Economic Forum Annual Meeting 2014 (1): 10th Anniversary of My Debut at Davos
World Economic Forum Annual Meeting 2014 (2): The Eve of the Opening of Davos 2014
World Economic Forum Annual Meeting 2014 (3): Day One
World Economic Forum Annual Meeting 2014 (4): Prime Minister Abe Becomes the First Japanese National To Deliver a Keynote Speech at Davos
World Economic Forum Annual Meeting 2014 (5): GLOBIS Night!
World Economic Forum Annual Meeting 2014 (6): Day Three
World Economic Forum Annual Meeting 2014 (7): The Last day
World Economic Forum Annual Meeting 2014 (8): Looking back
The 11th year at Davos
■Davos Conference 2013
World Economic Forum Annual Meeting 2013: Part 1, Day 1
World Economic Forum Annual Meeting 2013: Part 2, Day 2
World Economic Forum Annual Meeting 2013: Part 3, Day 3
World Economic Forum Annual Meeting 2013: Part 4, Japan Night and GLOBIS Night
World Economic Forum Annual Meeting 2013: Part 5, Day 4
World Economic Forum Annual Meeting 2013: Part 6, the Final Day
World Economic Forum Annual Meeting 2013: Part 7, Return Trip from Davos
■Davos Conference 2012
Davos Meeting 2012 (1): the First and Second Days - The Great Transformation: Shaping New Models
Davos Meeting 2012 (2): Day Three - Becoming on a Par with World’s Finest Business Schools
Davos Meeting 2012 (3): Day Four - Davos as a Main Arena of Diplomatic Battle
Davos Meeting 2012 (4): Day Five - Networking on a Global Scale
Davos Forum 2012 (5): Day Six - Scenes on the Way Back from Davos
■Davos Conference 2011
Davos 2011 (1): Davos Forum as a “Competitive Exhibition for Leaders”
Davos 2011(2) : Night Programs at Davos
Davos Forum 2011 (3): National Presence
Davos Forum 2011 (4): Live Twitter Broadcast of Prime Minister Naoto Kan’s Speech
Davos Forum 2011 (6): Scenes on the Way Back as I Tweeted
Davos Forum 2011 (8): Additional Episodes
■Davos Conference 2010
WEF Annual Meeting 2010 in Davos - Part 1: The significance of attending the Davos Conference
WEF Annual Meeting 2010 in Davos - Part 2: The road to Davos
WEF Annual Meeting 2010 in Davos- Part 3: A Scene surrounded by Wine
WEF Annual Meeting 2010 in Davos - Part 4: The Real Fun of the Davos Conference
WEF Annual Meeting 2010 in Davos - Part 5: Scenes from the second day at Davos
WEF Annual Meeting 2010 in Davos 2010 - Part 6: Scenes from the Third Day at Davos
WEF Annual Meeting 2010 in Davos - Part7: Scenes from the Fourth Day at Davos
■Davos Conference 2005
My Despair at Davos - The Capital Gains of Foreign Investors
The Davos Meeting - Where Public Opinion is Formed