Former Chairman Schwab Resigned in April After Whistleblower Allegations
Initial Investigation Finds Many Claims to Be True
"Intervened to Block Publication of Reports Unfavorable to Certain Countries"
Klaus Schwab, 87, the founder and former chairman of the World Economic Forum (WEF·Davos Forum), has been found to have manipulated the organization's national competitiveness reports.
According to Yonhap News on July 21 (local time), citing Bloomberg, Politico Europe, and the Swiss daily SonntagsZeitung, "An initial investigation by the Swiss law firm Homburger found that Schwab intervened multiple times in the WEF's national competitiveness reports, either by altering the rankings of countries such as those in the Middle East, North Africa, and India, or by blocking the publication of reports that would have been unfavorable to them."
The national competitiveness report evaluates and ranks countries based on productivity and resilience, serving as a foundational document for forum discussions. According to the reports, in 2017, when India's ranking was low, Schwab emailed then-Managing Director Richard Samans to request a delay in the publication of the report in order to avoid damaging relations with Indian Prime Minister Narendra Modi. He also advised against raising the United Kingdom's ranking, reportedly to prevent Brexit supporters from misusing the data. However, it is known that the report was eventually published.
In 2022, Schwab reportedly shared a draft of the report with a senior official from a country whose ranking had dropped and advised them to oppose its publication. In practice, the WEF did not publish the report at that time, citing uncertainty caused by the COVID-19 pandemic.
Homburger is currently investigating various allegations at the request of the WEF board, including that Schwab manipulated the national competitiveness reports and embezzled organizational funds. It has also been reported that his wife claimed 900,000 Swiss francs (approximately 1.5 billion won) in travel expenses, despite holding no official position at the WEF.
Schwab, a German economist, launched the European Management Forum, the predecessor of the WEF, in 1971 and developed it into the Davos Forum, held every January in the Swiss resort town of Davos. He resigned as chairman last year after allegations of sexual misconduct and racism surfaced. In April, following a whistleblower letter exposing allegations of report manipulation, embezzlement, and private use of real estate, he stepped down as chairman of the WEF board, a position he had held for over 50 years.
The whistleblower letter claimed that in 2018, the WEF purchased a luxury residence called "Villa Mundy" next to its headquarters for $30 million (about 41.9 billion won at the time) and spent $20 million (about 2.79 billion won) on remodeling, with Schwab's wife behind the acquisition. It also alleged that the Schwab couple used the residence exclusively. Additionally, it was claimed that Schwab mobilized forum resources and staff in an attempt to be nominated for the Nobel Peace Prize.
According to Bloomberg, the initial investigation results support much of the content of the whistleblower letter. A WEF spokesperson told Bloomberg, "We will withhold comment until the investigation is complete," adding that the final results are expected by the end of August.
However, Schwab has denied all allegations, stating, "I deeply regret that the results of the internal investigation have been leaked to the media," and added, "I feel deceived in this matter. If necessary, I will do everything in my power, including legal action, to protect my interests."
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