David Schepp is a veteran financial journalist with more than two decades of experience in financial news editing and reporting for print, digital, and multimedia publications.
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The World Economic Forum is known for its annual winter meeting in Davos, Switzerland, where political leaders, business executives, and representatives of civil society discuss global economic, political, and social issues.
Who founded the World Economic Forum and why?
Klaus Schwab, a German-born scholar, founded what became the World Economic Forum in 1971 to improve European corporate competitiveness with U.S. companies. It started as a management symposium in Davos.
What role does the World Economic Forum play in diplomacy?
The World Economic Forum has at times provided a neutral setting for informal dialogue between political rivals, including the 1988 Davos Declaration between Greece and Turkey and early meetings involving officials from North and South Korea and South African leaders Nelson Mandela and F.W. de Klerk.
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The World Economic Forum annual meeting in Davos has long served as a gathering place for powerful figures in government and business.
The World Economic Forum is an international organization that convenes political leaders, business executives, policymakers, and representatives of civil society to discuss global economic, political, and social issues. It is best known for its annual winter meeting held in Davos, Switzerland. The gathering is so prominent that Davos has become shorthand for both the event and the circle of political and business leaders who attend it.
Over time, the forum has grown from a small European management conference into one of the most visible stages for discussions about globalization, economic development, technological change, and international cooperation.
Origins and early development
The forum was founded by Klaus Schwab, a German-born scholar of business policy and professor at the University of Geneva. In 1971, Schwab organized a management symposium in Davos that brought together several hundred European corporate leaders interested in improving competitiveness with U.S. companies. Encouraged by the meetingâs success, he established the European Management Forum later that year as a nonprofit foundation.
The town of Davos was chosen deliberately. The isolated Alpine resort offered privacy and a retreat-like atmosphere intended to promote candid conversations rather than public posturing. In its early years, the forum focused primarily on management practices and corporate governance, reflecting Schwabâs belief that responsible business leadership was essential to economic stability.
As the forum evolved beyond a single annual meeting, it established a permanent headquarters in Cologny, Switzerland, near Geneva, and gradually expanded its activities.
From business meeting to global gathering
As the forum began to broaden its scope beyond corporate management issues in the mid-1970s, political leaders were invited to attend, and the agenda expanded to include international economic policy, development, and social concerns.
In 1976, the forum introduced a formal membership system for âthe worldâs leading companies.â Over time, the annual meeting in Davos attracted heads of state, central bankers, senior executives, academics, and representatives of labor groups and nongovernmental organizations (NGOs). The forum also began sponsoring regional meetings in other parts of the world.
In 1987, the organization adopted the name World Economic Forum, reflecting its broadened international scope. By the late 1980s and early 1990s, Davos had become a regular meeting place for figures who might otherwise have limited opportunities for informal contact. As the forumâs visibility grew, the annual gathering increasingly drew global media attention, reinforcing its reputation as a place where economic and political leaders met to exchange views on the direction of the world economy.
What happens at Davos
A break from Davos
The World Economic Forumâs annual meeting has been held only in Davos, Switzerland, with one exception. In 2002, the meeting was moved to the Waldorf Astoria hotel in New York City following the September 11 attacks, a move intended to express solidarity with the United States.
The forumâs annual meeting in Davos brings together several thousand participants for a mix of public sessions and private discussions. The program typically includes panel discussions on global economic trends, geopolitics, climate policy, public health, and technological change, alongside smaller workshops and closed-door meetings. The meeting has no formal decision-making role.
Beyond Davos: The forumâs year-round work
Although best known for its annual meeting, the World Economic Forum operates year-round. It convenes regional and thematic meetings and produces reports on global economic conditions and long-term risks that are widely read in policy and business circles.
The forum has also sponsored initiatives beyond Davos, including the Global Health Initiative, launched in 2002, and coordinates year-round work among its members on selected economic and social challenges.
The forum is funded primarily through membership fees and participation fees paid by companies and organizations that take part in its meetings and initiatives. Governments, international organizations, and civil society groups also participate in its activities, but the forum itself is a private organization and receives no public funding.
Influence and diplomatic role
Although the World Economic Forum has no formal diplomatic authority, it has at times provided a neutral setting for dialogue between political rivals. Perhaps its most frequently cited example is the 1988 Davos Declaration, a no-war agreement between Greece and Turkey, which were then close to armed conflict over disputed underwater research near Greek islands in the Aegean Sea.
Davos Man
The term Davos Man was popularized by the American political scientist Samuel P. Huntington to describe the global elite associated with the World Economic Forumâs annual meeting. It refers not to a specific individual but to a type: wealthy, highly educated figures active in international business and policymaking who are often seen as more aligned with global institutions than with national or local concerns.
Critics use Davos Man as shorthand for worries about elitism and insulation from everyday economic pressures, arguing that global problems are debated by people largely shielded from their consequences. Supporters counter that challenges that cross borders require international cooperation, and that gatherings like Davos provide a rare setting for such dialogue. The debate centers on whether Davos Man meaningfully advances solutionsâor merely reflects the self-preservation of a global elite.
The forum has also been associated with other moments of informal diplomatic contact, including the first ministerial-level meeting between officials from North and South Korea in 1989; the first face-to-face meeting between African National Congress President Nelson Mandela and South African President F.W. de Klerk in 1992, ahead of South Africaâs transition away from apartheid; and discussions that contributed to the drafting of the Gaza-Jericho Agreement (also known as the Cairo Agreement) in 1994, a peace treaty reached by Palestinian Liberation Organization chairman YÄsir ÊżArafÄt and Israeli Prime Minister Shimon Peres.
Despite these successes, the World Economic Forum faced growing criticism in the late 1990s from antiglobalization activists, who accused the organization of promoting global capitalism in ways that disenfranchised poorer countries. The American political scientist Samuel P. Huntington described the forum as âa watering hole for the eliteâ and coined the term Davos Man.
Protests continued into the early 21st century, and the forum responded by expanding invitations to NGOs and participants from developing countries and by launching the Open Forum Davos in 2003, a parallel series of public discussions open to a wider audience.
Criticism and skepticism
Elitism and access. Attendance at Davos is expensive and tightly controlled, leading critics to argue that the forum privileges wealthy countries and large corporations.
Representation and legitimacy. Skeptics question whether an unelected gathering of political and business leaders should have influence over global economic and political agendas.
Transparency and governance. The forumâs funding model, close ties to corporate members, and internal governance practices have periodically drawn scrutiny.
Detachment from economic realities. Critics argue that discussions at Davos often reflect the perspectives of decision-makers who are insulated from the economic pressures facing much of the worldâs population.
Leadership and governance
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Klaus Schwab is the founder of the World Economic Forum, which he led from 1971 until his resignation in 2025.
For much of its history, the World Economic Forum was closely identified with its founder, Klaus Schwab, who served as its chair for decades. Schwab stepped down in April 2025 amid an internal investigation into governance and management practices, which the forumâs board launched in response to whistleblower allegations that Schwab denied.
In August 2025, the findings of the investigation were released, concluding that neither Schwab nor his wife had engaged in material wrongdoing. After a meeting to discuss the probeâs conclusions, Brabeck-Letmathe resigned, noting in his resignation letter that the organization had a âtoxicâ work environment.
Over more than five decades, the World Economic Forum has established itself as a distinctive fixture in global economic and political life. It has neither formal authority nor decision-making power, but its ability to convene leaders from government, business, and civil society has given it an enduring presence in debates over globalization and international cooperation. Whether viewed as a useful forum for dialogue or as a symbol of elite influence, Davos remains a touchstone in discussions about how global challenges are addressed.
This article was most recently revised and updated by David Schepp
