1.29.2008 ET

January 29, 2008 - Well, it's been 4 days and 1 "Davos" since my last blog. Got about 3 hours sleep last night (brings my total for the week to ~18), and now I'm headed down the mountain towards Zurich. Just time to share a couple of observations and 1 particular highlight before both my computer and my brain say "leave me alone you fool" and take a much needed rest.

Each year 1 or 2 themes emerge as dominant. In 2007 the prize went to global climate change, in 2008 the WEFie (like an Oscar only not) goes to… the state of the US economy. From TV crews taking surveys on every street corner, to a panel of all 8 of the G8 Finance Ministers, the question on everyone's lips was, "a slowdown or a recession"? I know I'm just a lawyer, but I'll try to summarize the consensus answer: we have not yet seen the bottom in terms of the sub-prime crisis; if the US Congress acts quickly and decisively with a stimulus package we may be able keep this from developing into a full blown (or long lived) recession; this isn't just a US problem so other economies around the world are going to have to pitch in; and, non-US markets are strong enough to survive a US cold without catching the flu, but only if the US ailment does not turn into influenza or something worse (all economists wanted to be doctors but couldn’t afford the tuition).

The other key theme for 2008 was 'enlightened capitalism'. Both Forbes and the Economist kicked off the week with articles about the need to align corporate social responsibility programs with business interests and core competencies. Bill Gates made a public plea for more "compassionate capitalism" and Dr. Muhammad Yunus (Nobel Peace Prize winner) gave us the phrase "social business". No matter what its called, it boils down to a pretty simple idea: corporations can and should make profits for their shareholders; but corporations can also chose to run some "not-for-loss" programs where the shareholders break even but the program recipients and society at large are immeasurably enriched. Don't think corporate charity, instead this is a corporation putting its money, human resources, program management, and logistical skills, etc., to work in a financially neutral but socially positive way. Let's face it, governments have money and people but government efficiency is an oxymoron. NGOs and "not for-profits" can be nimble but they usually lack resources. Of course enlightened capitalism should involve public/private partnerships but it’s the financial model that really sets it apart from what we currently think of as CSR or corporate philanthropy. An interesting idea…stay tuned.

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