Two Hopeful Takeaways from the World Economic Forum (and One Thing to Keep a Close Eye On)

Last week, I attended the World Economic Forum in cold and snowy Davos, Switzerland, on behalf of the Wrigley Institute. It was my first time. “The WEF,” as I learned the insiders call it, isn’t just an annual meeting; it’s also a not-for-profit organization based in Geneva. The WEF puts forward “stakeholder theory” as a guiding principle, asserting that organizations—businesses, governments, and even universities—should be accountable to all parts of society. It’s for that reason that The WEF welcomes representatives from the public and private sectors, international organizations, the arts, and academic institutions to its annual general meeting held each year in Davos.

Although public discourse about The WEF often focuses on the world leaders, billionaires, and other luminaries who gather in the conference’s “secure zone,” I was pleasantly surprised to discover that the minimum-security side of the event attracts a lot of smart people who come from different backgrounds to talk about and try to address global challenges.

Any apprehension I had felt about the “elite” nature of the conference was immediately dispelled by the dozens of people I met on the streets and trains, and in the cafes and meeting rooms, and by all of the engaging and fascinating conversations we had. We talked in-depth, sometimes agreeing and just as often not, about topics ranging from artificial intelligence and the power of human partnership to the mitigation of climate risks and the need to better quantify sustainability impact. The people I met were students, entrepreneurs, leaders of start-ups and scale-ups, scientists, and storytellers, among others. And, to an individual, they weren’t shy about wearing their hearts on their sleeves. It’s thanks to them that I left Davos feeling more hopeful than less, and more motivated than ever to do what it takes to make a positive difference while I’m lucky enough to walk this, our only Earth.

With that, here are two things that I talked with people about at the WEF that make me hopeful that we’re poised to make a positive difference for the world, and a third that I think we need to keep an eye on if we’re to do the same:

1. The energy and carbon transitions are here to stay.

As part of global action to limit the risks posed by climate change, collaboration between the public and private sectors across much of the world has led to both positive change and increased momentum when it comes to decarbonizing energy and transportation systems, and the economy at large. Sessions I attended leaned into the connection between climate change and issues like human health, biodiversity and ecosystem services, production and consumption, and peace and wellbeing. Data that was shared included a positive outlook for continued growth in the deployment of large-scale renewable energy systems alongside the scaling of technologies, such as carbon dioxide removal (CDR), that together will limit future climate change and may even be able to reverse its most catastrophic consequences.

It’s actually this latter point which was behind my attendance at The WEF in the first place. I was invited as the Wrigley Institute’s director by the Swiss scale-up Climeworks to moderate a pair of discussions about the prospects for CDR to reach gigaton scale. Though economic hurdles remain—the low global average price of CO₂ among them—the technology is maturing to the point that the gigaton scale needed to begin removing legacy CO₂ emissions seems within reach. I especially appreciated that certain players in the CDR space are focusing their attention on legacy vs. present-day emissions. In other words, companies like Climeworks are seeking not to use their technology and partnerships to justify present or future carbon emissions; their interest is squarely on encouraging their customers and partners to decarbonize first, with their technology used to capture the CO₂ which remains behind.

And, maybe the most hopeful thing I heard while in Davos was that progress on the energy and carbon transitions has been so great that they are becoming increasingly resistant to geopolitical shocks. Progress has been so far-reaching, and the link between the two types of transitions so solidified, that it would be difficult for external change (e.g., in national, regional, or local political leadership) to reverse it. This is welcome news as we at the Wrigley Institute start taking steps to build a long-term research initiative on climate and carbon management.

2. The philosophy behind ESG is alive and well.

While the ESG (environmental, social, and governance) label is on its back foot, having been erased from this year’s WEF agenda, the sentiments which underlie it are alive and well.

Accounting for ESG issues in corporate reporting gained prominence over the last decade as a mechanism to hold firms more accountable to investors, the communities where they work, and the customers that they serve. The idea is that companies which account for their environmental impacts do a better job of adhering to a social contract which obligates them to work as sustainably as possible, while also reducing long-term business exposure to risks such as those posed by climate change. Through ESG reporting, companies also account for their social impact, both within the firm and in the broader community.

This helps ensure that what goes on inside the company meets the expectations of society—surrounding equity and diversity, for example—while the business also works to achieve social good beyond its operating borders. ESG also holds companies accountable for ensuring that their governance structures reflect the broader composition of society—for example, in terms of gender and ethnicity—and high expectations for competence. To put it all more simply, in order to survive and thrive in today’s increasingly interconnected world, companies must ensure that they are set up for success in terms of how they are structured and led internally, the kinds of risks they expose themselves to, and the positive impacts they make externally.

Far from being a fringe philosophy, ESG has been embraced by the likes of blue-chip companies such as Blackrock, J.P. Morgan Chase, and Julius Baer. But in spite of its high-profile boosters, ESG has been sharply criticized as of late—criticisms which are legitimate, in my opinion. The largest among them: measuring ESG is often an arbitrary and inconsistent enterprise. For example, nothing stops a company from claiming progress on stated carbon reduction goals by focusing on its Scope 1 emissions (those generated by company-owned or -controlled sources) while ignoring their Scope 2 and 3 emissions (those generated by external sources such as energy sources, suppliers and vendors, etc.). There’s also significant variation between companies in terms of who reports what. The end result has been a lot of confusion, confusion that isn’t misplaced when you consider that some fossil fuel companies give themselves better ESG ratings than makers of electric vehicles.

These and other critiques weren’t lost on the WEF crowd. But instead of participants throwing in the towel on ESG, we widely acknowledged the importance of each of the concept’s core elements and agreed on the need to improve and standardize ESG frameworks to provide better value for investors and, importantly, for sustainability. All of this is good news for the Wrigley Institute because it means we can continue to play an important role in shaping the conversation about ESG through our research, and through academic programs such as our new online Master of Sustainability Management degree.

3. Don’t let go of the steering wheel that is A.I.

Nothing—and I mean nothing—received more attention at The WEF than artificial intelligence. From hubs dedicated solely to it, to discussions of how it can be applied to improve everything from healthcare to forecasting natural hazards, there was no getting away from A.I. What struck me, though, was how people were talking about it. While official language described A.I. as a tool that can provide us with more insight about the big decisions that will confront us, the subtext of many of the conversations I took part in was about A.I. actually making big decisions for us.

Is a new carbon-recovery technology worth investing in? Ask A.I.

Should we evacuate our home because a forest fire is burning nearby? Ask A.I.

Should we prioritize one ecosystem over another in biodiversity protection? A.I. will know the answer.

There’s no doubt that A.I. already knows—and can do—a lot. And there’s no doubt that A.I. is getting better every day. But, as a psychologist who studies decision science, I worry about what A.I. will mean for our critical thinking abilities over the long-term. I’ve done research and have written about how, as people, our critical reasoning and decision-making skills are in decline.

For this reason, I can’t help but worry about A.I.’s potential to further deteriorate our critical reasoning and decision-making skills going forward. So, when it comes to A.I., I worry about the gradual and further erosion of the human condition, as it was depicted in Wall-E, much more than I worry about doomsday scenarios like the ones portrayed in movies such as War Games and The Terminator. If you ask me, it’s high time to get a better handle on A.I., both in terms of the social norms and higher-level oversight that govern its use.

In the days since The WEF ended, I’ve been asking myself, would I ever go back? The answer, for now at least, is an easy “yes.” The quality of ideas shared at the forum are, alone, enough to justify another trip to Davos. And when I combine this with the networking opportunities and the chance to learn from others’ experiences, it’s an even easier decision to make. In spite of the cold and the snow. . .