Copyright 2010 Marketwatch
Distributed by McClatchy-Tribune News Service
January 25, 2010 Monday
SECTION: BUSINESS AND FINANCIAL NEWS
LENGTH: 1121 words
HEADLINE: Bankers scarce as Davos probes post-crisis dangers
BYLINE: By William L. Watts, MarketWatch
LONDON _ Some of Wall Street’s heaviest hitters won’t be in attendance when the world’s top CEOs, economists, political leaders and other movers and shakers arrive in Davos for the annual meeting of the World Economic Forum to discuss the threats to a fragile global economic recovery.
Once the toast of the town, financiers appear reluctant for a second straight year to be seen strutting about an exclusive Swiss ski resort while fending off criticism of record bonuses in the wake of massive taxpayer-funded bailouts.
But with President Barack Obama moving aggressively to rein in bank activities, regulatory reform promises to be a hot topic at the annual gathering.
Among the missing, Goldman Sachs CEO Lloyd Blankfein, a Davos regular before 2009, doesn’t plan to attend. Goldman President Gary Cohn, however, will be making the trip, a spokeswoman said.
JPMorgan Chase CEO Jamie Dimon, one of the few big bankers to make the trek last year, won’t be there. Other executives will attend, the bank said.
Not all will be deterred. Morgan Stanley Chairman John Mack is registered to attend, and a Citigroup spokesman said CEO Vikram Pandit will make the trip.
And the bosses of several big European banks will be present. Barclays PLC President Bob Diamond, who skipped last year’s event, is scheduled to return, according to organizers.
Other European executives registered to attend include Deutsche Bank CEO Josef Ackerman, who is a co-chair of this year’s annual meeting, as well as HSBC Holdings Chairman Stephen Green, and Credit Suisse CEO Brady W. Dougan.
Organizers argue that the overall number of CEOs is as strong as ever, with around 1,400 top-level executives expected out of a total of 2,500 participants.
World Economic Forum founder Klaus Schwab told a news conference that this year’s event is dedicated in large part to “rethinking our values” in the wake of the crisis. The organization’s own research shows public trust around the world in businesses and other institutions is at low ebb.
Critics say that Davos in the past was too enamored of the idea that markets can self-correct. Some feel the time is ripe to make the case for increased regulation.
Richard Trumka, president of the AFL-CIO, the giant confederation of U.S. labor unions, is making his first trip to Davos, where he says he will argue for tougher regulation of hedge funds, private equity and over-the counter derivatives, corporate-governance and executive pay reforms and the formation of a systemic risk regulator.
“I don’t think (Davos) is the optimal venue, but there hasn’t been a workers’ point of view injected, and we plan to inject that,” Trumka said.
Others say the World Economic Forum deserves credit for promoting wide-ranging dialogue that also included union leaders, social entrepreneurs, non-governmental organizations and religious leaders, even if the headlines out of Davos were at times dominated by the financial titans.
“There aren’t many places in the world where those conversations take place and I hope that Wall Street is represented, because if anyone needs to be part of that conversation and hear what the rest of the world has to say, it’s probably those executives,” said Angel Cabrera, president of the Thunderbird School of Global Management in Glendale, Ariz.
Cabrera, who is leading a campaign at the annual meeting to get executives to take a professional “oath of honor,” said he’s hoping to find “serious reflection” among participants “about how we got into this situation and how we can avoid getting back into something like this.”
Jack Ehnes, CEO of the California State Teachers’ Retirement System, the second-largest U.S. pension fund, said efforts to rebuild trust in leaders and institutions is crucial to turning the corner in the crisis.
“All of us that have leadership positions in the financial sector have to recognize that there is now an embedded long-term skepticism by the general public about what we do, and the ultimate recovery is going to be dependent on restoring that trust,” he said.
Outside the financial sector, corporate luminaries include Google CEO Eric Schmidt, a meeting co-chair; Alcoa CEO Klaus Kleinfield. Kraft Foods CEO Irene Rosenfeld, fresh off the conquest of British confectioner Cadbury’s, is registered to attend.
In addition to the corporate big shots, participants include 30 heads of state or government and dozens of lawmakers, government ministers, central bankers and regulators, as well as union leaders, heads of non-governmental organizations, academics and an army of media.
While the meeting isn’t a forum where policy-makers hammer out decisions, it is a venue for power brokers to meet and talk _ and not always in public. The meeting has long been a target of anti-capitalist protesters, though Swiss authorities make it difficult to reach the mountain resort.
Numerous sessions are scheduled to look into the shortcomings of corporate governance, compensation policies, monitoring of systemic risk and regulatory cooperation.
Others will examine threats to the economic recovery. A report produced by the World Economic Forum ahead of the annual meeting highlighted sovereign risk as the biggest threat to the global economy, a danger highlighted by ongoing jitters over Greece’s debt woes and the potential for other debt problems elsewhere in the euro zone.
European Central Bank President Jean-Claude Trichet and Greek Prime Minister George Papandreou are scheduled to discuss efforts to repair the euro-zone’s public finances.
An economic panel will feature New York University economist Nouriel Roubini, known as “Dr. Doom” for his early predictions of an economic downturn. Another Davos regular, Yale University economist Robert Shiller, who offered early warnings about the U.S. housing bubble, is also set to attend.
Top White House economic adviser Larry Summers is set to discuss the U.S. economic outlook.
And while dealing with the aftermath of the financial crisis will be a central concern of the annual meeting, it won’t be the sole focus.
Schwab said efforts to help Haiti recover from the devastating earthquake that left tens of thousands dead will be high on the agenda. Former U.S. President Bill Clinton will host a special session on Haiti, and Schwab said the World Economic Forum will encourage businesses to make long-term investments in the Western Hemisphere’s poorest nation.
(c) 2010, MarketWatch.com Inc.
Visit MarketWatch on the Web at http://www.marketwatch.com
Distributed by McClatchy-Tribune Information Services.
For reprints, email firstname.lastname@example.org, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.
LOAD-DATE: January 26, 2010