<html> <head><style type ="text/css">body { font-family: "Bloomberg Prop Unicode I", Verdana, sans-serif; font-size:125%; letter-spacing: -0.3pt; color: #FF9F0F; background-color: #000000; text-align: left; } p {line-height: 1.25em; max-width:900px; width:expression(document.body.clientWidth > 900? "900px": "auto" );} h1, h2, h3 { text-align: left; font-weight: normal; color: #FFFFFF; } h1 { font-size: 130%; } h2 { font-size: 115%; } h3 { font-size: 100%; } #bb-style { font-size: 90%; max-width:900px; width:expression(document.body.clientWidth > 900? "900px": "auto" ); } b, strong { font-weight: bold; } i, em { color: #FEC54A; } pre { font-family: "Andale Mono", "Monaco", "Lucida Console"; letter-spacing: -0.3pt; line-height: 1.25em; } table { border: 0; font-size: 90%; width: 100%; margin-left: auto; margin-right: auto; } td, tr { text-align: left; } td.numeric { text-align: right; } a:link { color:#53B2F5; text-decoration: none; } a:visited {color:#53B2F5} a:active {color:#53B2F5} a:hover {color:#53B2F5} </style> </head> <body> <p>By James Gibney</p> <p>The aspirational hypocrisy of the <a href="http://www.weforum.org/">World Economic Forum</a> is enshrined in its motto: "Committed to Improving the State of the World." Unlike other storied global conspiracies -- the Trilateral Commission, for example, or the <a href="http://www.bilderbergmeetings.org/index.html">Bilderberg Group</a> and the Bohemian Club -- whose members are presumed to be in it just for the filthy lucre and power-mongering, the WEF makes a big deal of its embrace of rainbow-hued do-gooders. The Forum is forever trumpeting its commitment to transparency and inclusiveness along with a burgeoning list of initiatives to advance the same.</p> <p>But let's follow the money -- where it comes from and where it goes, starting with the 100-plus strategic partners who, as the forum puts it, "comprise some of the world's leading corporate citizens and provide essential leadership in support of the Forum's mission." In 2012, they contributed slightly more than half the WEF's revenues (some 178 million Swiss francs, or about $192 million).</p> <p>Consider one such leading corporate citizen: Axel Weber, co-chairman of this year's Davos meetings and chairman of UBS, Switzerland's largest bank. Last year, his company was<a href="http://www.bloomberg.com/news/2012-12-19/ubs-libor-fine-soars-as-traders-bribed-brokers-to-fix-libor-rate.html"> fined</a> $1.5 billion for its schemes to rig global interest rates. The U.S. Commodity Futures Trading Commission cited more than 2,000 instances of illegal acts involving dozens of UBS employees. And that scandal followed a $780 million U.S. settlement in 2009 over charges that the bank had helped U.S. clients avoid taxes. WEF founder Klaus Schwab's choice of Mr. Weber as co-chairman perhaps speaks volumes about his own values.</p> <p>Other strategic partners include Bank of America Corp., which just agreed to pay Fannie Mae $10 billion to settle allegations that it had improperly handled mortgages; Barclays Plc, which also paid nearly a half-billion dollars in a settlement over manipulating interest rates and faces record fines for trying to fiddle energy markets; Citigroup Inc., which last year settled a lawsuit over sub-prime mortgages for $590 million; Credit Suisse, out more than a half-billion dollars for money laundering. I'll stop at the C's, leaving out Deutsche Bank, Goldman Sachs, HSBC, Standard Chartered, and other financial strategic partners that are either under investigation or have collectively paid billions in fines for a variety of bad behaviors. I also won't go into the various settlements over allegations of bribery and bid-rigging by some of WEF's non-financial strategic partners, such as ABB and Accenture.</p> <p>These companies may have skipped all the Davos sessions on transparency, ethics and holding stakeholders in high regard, but they have done wonders for the Forum's bottom line. From 2002 to 2012, partnership revenue more than quadrupled as overall revenue more than doubled. The Forum's headcount, meanwhile, has gone from 139 full-time staff members to 371.</p> <p>Many of these people do good work, putting out interesting reports and holding one heck of a global salon. But the interests they represent are corporate -- no more, no less. "Improving the state of the world," added to the Forum's logo well into its third decade, comes behind networking and dealmaking.</p> <p>A recent quote from Sir Martin Sorrell, chairman of WPP -- another Forum strategic partner -- is instructive. Asked about the right model for corporate taxation, he magnanimously <a href="http://www.bbc.co.uk/news/business-20798067">told</a> the BBC: "The right model is you make a contribution. All contributions you make to your stakeholders are a question of judgment. There are the rules," he said. "If then companies choose... in terms of building their long-term brands to make a contribution to all the stakeholders, all credit to them." Payment of taxes, in other words, is at the discretion of global corporations.</p> <p>That's mighty generous of you, Sir Martin. As Oliver Twist once <a href="http://www.youtube.com/watch?v=sZrgxHvNNUc">said</a>, "Please, sir, I want some more."</p> <p>I have a modest proposal for the Forum's strategic partners: If you want to improve the state of the world, start by obeying laws and paying your taxes. Until then, spare us the high-minded, multi-stakeholder <a href="http://davos2010.theatlantic.com/2010/01/davos_delusions.php">palaver</a>.</p> <p>(James Gibney is a member of the Bloomberg View editorial board. <a href="https://twitter.com/#%21/jamesgibney">Follow</a> him on Twitter.)</p> </body> </html>