Why Davos is ineffective, out of touch and irrelevant

Few renewables companies were involved in discussions, despite the focus on climate and clean energy, writes Liam Kavanagh

Between Theresa May’s Brexit revelations and Donald Trump’s inauguration earlier this month, the World Economic Forum annual meeting in Davos, Switzerland, worked its way through its yearly effort at shaping the future. With some excitement, I saw that the programme included more than ten sessions devoted to sustainability, climate change and clean energy.

But on closer inspection of the speaker line-up, I remembered why the World Economic Forum, in its 47 year, is such a disappointment.

It’s 68% theory and 32% practice. Most panelists are politicians, academics or journalists and less than a third run the companies that are tasked with implementing the changes that the theorists encourage.

Worse still, the companies that make up that 32% are not the true motors of change. More agile, more innovative and more driven are the small, young, entrepreneurial businesses that don’t get a seat on the Davos panels.

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Take “The Global Energy Outlook” session. Five speakers: one corporation: Engie, a former national gas monopoly. “The Return of Carbon Markets” had six speakers, of which two were corporate: one an international civil engineering company and the other the world’s largest cement manufacturer. “Energy’s Clean Transition” was something of a democratic triumph for the doers, with three of the six speakers representing the corporate view. Oh, but wait, they were Total, the world’s fourth-largest oil and gas company; UC Rusal, the world’s second-largest aluminium producer; and Iberdrola, which may have cleaner credentials than the other two but still employs over 30,000 people.

Companies are already in the minority at the World Economic Forum, and those that are there are huge. Yes, that means that they probably have the financial muscle to implement change. But their size also means that they have a lot of vested interests and may be decidedly uninterested in changing the status quo. By attending Davos, large corporates are merely improving their social responsibility reputation and distracting attention from the reality, which is their need to drive profits at the expense of the environment.

I find it remarkable that it was possible to have one, let alone ten, serious debates about a cleaner future without proper representation of renewable sources. Admittedly, José Ignacio Sánchez Galán, the head of Iberdrola, a notable player in wind power, did his best to put the case for renewable energy, but he was a lone voice in a session dominated by Total and civil servants.

And while climate change was high up on the agenda, there was a definite lack of representation. Where was PV? Where was tidal power? Biomass? There are many smaller companies around the world pushing renewable-energy sectors to new cost-effective and quality highs. It would have been helpful to hear how they see the future. As it was, I counted just three small businesses involved in sustainability — two recycling companies and one water-saving food enterprise. In total, there were 156 companies represented on the panels and all but nine of them were large. There is something about that imbalance that makes me question the relevance of the whole, expensive event.

Liam Kavanagh is the founder and chief executive of renewable-energy investor Rockfire Capital