Restoring trust will be key at Davos

Italian premier Mario Monti will set the tone for beleaguered business and political leaders gathering in Davos this week for the annual World Economic Forum (WEF), with a speech entitled ‘Leading against the odds’.

The pow-wow will bring together more than 1,500 business leaders and up to 50 heads of state or government, many of them, like Mr Monti, weathered by almost perpetual crisis as they fight to bring their economies and companies through global financial turmoil and a few homegrown scandals of their own.

“It’s very clear that the future of the world economy is based on restoring trust. Restoring trust in leaders, restoring trust in our future. And this means we have to move out of this crisis mode,” WEF founder Klaus Schwab told a news conference.

There’s still some way to go, according to a survey by global public relations firm Edelman published yesterday.

“There is an incredible lack of trust in leadership,” said Richard Edelman, the firm’s president and chief executive. “Levels of trust in governments are worse than for business, but they are both terrible.”

Edelman’s annual survey across 26 countries did show a rise in trust in business and government over the previous year, but only 26% trust business leaders to solve social issues and 15% for government leaders, and 19% expected business to make ethical decisions, while only 14% said the same for politicians.

Edelman said trust in public figures had been eroded by scandals in the banking industry as well as controversies, including cyclist Lance Armstrong’s admission of doping.

Though Europe managed — just — to keep the eurozone intact in 2012 and Washington stepped back — at the last minute — from its “fiscal cliff“, a WEF survey this month showed business leaders and academics fear politicians are failing to address fundamental problems.

And they will have it all to do again in 2013, subject to the ballot box. Mr Monti will be defending his austerity measures in parliamentary elections in four weeks, and German chancellor Angela Merkel will be hoping a weekend defeat for her party in a regional election won’t derail her re-election later this year.

Among the Davos 2013 attendees will be Taoiseach Enda Kenny, former president Mary Robinson, Finance Minister Michael Noonan, Archbishop Diarmuid Martin, ambassador Martin Burke and telecoms billionaire Denis O’Brien.

The WEF’s annual risk report cited inequality and the burden of government debt as the biggest economic threats and also highlighted a rise in concern about severe weather.

The Algerian hostage crisis, the French campaign against Islamists in Mali and the fallout from the Arab Spring will also be hot topics.

The Davos elite will be shielded from dissent by a ring of razor wire and up to 5,000 Swiss soldiers, though activists will be handing out an award for “the worst company of the year”, and Swiss left-wing groups plan small protests against financial speculation.