Ladies and gentlemen, welcome to the Open Forum 2013. This is a very special place and it is, I think, an exciting program we have this year. So a program that we offer in parallel to the annual meeting with the opportunity to really get the dialogue and you get into the discussion with leaders of the world from the public, the private world, but also the civil society and art. Now, there's numerous people that come from the region of Davos, from Davos, the town, but a lot of students, not now at lunchtime, but this evening you will see, members of foundations that come regularly every year to these sessions. So we really get an incredible mix of an audience in the Open Forum. Let me just tell you what is new this year at the Open Forum. New is, of course, the website for all those who already discovered this, a new website that allows you really to get an overview, but also to have access to Twitter and to blogs. And I see people blogging here and Twittering so that they're very active. We have much more media presence this year. All sessions are directly televised this year and are distributed by Eurovision. And what we have new that is, and you may be happy for the coming sessions, an overflow room. So if really we don't have, we have more than three under people. We have a room right next door where you could stay and you have a big screen and you can participate, including coming in and ask questions. So you're really part of, it's not somewhere else, you are just next door and if you have a question you come in and you get the microphone and participate. And what we have is new too. There's a lot of shapers and young global leaders that are part this year too. I think it is an incredibly attractive program. And it's attractive obviously for the public if I see the numbers of the last few years because we always had like three thousand and more people coming to the open forum. But it's interesting also that it becomes more and more attractive for speakers. And I just met somebody of the media and said it's incredible that this year we have a lot of speakers that asked us if they could come to the open forum and be on the panel. And I think it is interesting because it shows you that they obviously love to be on this open forum panel that they want to be part because it is, you know, they want to discuss with the students, the population, the people of the region, the visitors here, and of course the people that are at the annual meeting. What are the topics that we have today and what are the speakers? And I want to quickly run through what we decided this year to offer. And when I say we, I mean the advisory board, the way we have representatives of the International Red Cross, of the Federation of the Swiss Protestant Churches, of the politics in, so I would say the burn politicians, the Bankers Association, NGOs, or a group of anti-corruption organization that is involved with us. And of course the team. So I speak to you as the responsible managing director at the World Economic Forum. My name is Gilbert Probst. Behind me and the doers are, in fact, of course ladies you see, you probably met at the entrance, Petra and Tiffany, and most importantly, Salima Ben-Generes who designed this program, and I want to say thank you to this team because they did a great job. So I will not say much about today because Esther will introduce the team and the topic, but that we have the NGOs as a topic, the role, the new models, the questions of accountability. There is a good reason for this. The NGOs have developed a lot in the last five to ten years. You know that they are a natural stakeholder also at the annual meeting, very present, they professionalized a lot, but with that comes the question, should they be run like companies? Who is accountable? And I think these are a lot of topics that she will perk up today with the panelists. Tonight you have, I think, a topic that is, well, it's all over in Europe, in the world topic. If you have read the Targa Zanzeiger in Switzerland today, you probably saw that it is the topic now, with the announcement that in Spain they are now at 25% plus unemployment, 50% of the youth. And this is something that we will pick up. Questions like how come that young people are three times as often as adults to be unemployed today? 75 million young people look for a job worldwide. Many adults lost their job. And at the same time you have protests against unemployment, but you also have, obviously, companies that say they don't find the right people for their jobs available. This is something that we will pick up, and I think we have a great panel tonight with Sharon Borough, the General Secretary of the International Trade Organization, Chris Gopola Krishnan, who comes from Infosys, a company that is extremely active in creating jobs in India, or Frederick Reinfeldt, the Prime Minister of Sweden. Thursday tomorrow we look into the mega sporting events. Who has an interest in mega sporting events? Who benefits? Who pays for it? What happens to the infrastructure at the end? I mean, these are questions that we have to ask all over the world when we have the football events where 750 million watched, for instance, the World Cup, when you think of the Olympics or car racing. And I'm really happy to have Jean-Claude Biver of Hublotback, you know that they are very much involved in sponsoring. Ueli Maurer, of course, as the President of Switzerland. And Peter Sauber, everybody knows him from the car racing. I'm sure that the people of Davos have quite an interest in the region because you all talk about the Olympics here in the future. In the evening we do something that is very special and different, life sessions from jazz, where you learn about creativity and interaction and collaboration and leadership. With one of the top musicians, Chris Washburn is one of the best trombone players in the world, but he's also a professor at Columbia University at the School of Music and he's a fantastic speaker. Friday is religion outdated. A question that comes up, more and more, 80% of the people in the world say they are affiliated to religion. But then the question comes, are there clashes between the religions? Are we going into domination, or do we really have a multi-religion society in the future? Shapers will be there, as today, by the way, and I'm glad to have young people on the stage. Shaper youth present on the stage, Carol Cayan, who is the President and CEO of the Catholic Health Association, or Sulak Sivadresna, who is from Thailand, who was twice nominated for the Nobel Prize. In the evening, Eurozone, and I don't think I have to talk about the Eurozone and the problems we're in, but the amazing is that you get the Ministers of Economics and Finance of Italy, Spain, Belgium, Germany, and the Secretary General of the OECD. I think we can't go do better for panels on this. Saturday, we will talk about a very sad and not enough known topic called obesity, the fastest growing chronic disease in the world. The fastest growing disease in the world. 2.8 million adults die every year based on the obesity. You have 1.5 billion people in the world that are overweight and it is growing very fast. And I think I'll look really forward to A, the academia represented by Linda Fried from the Columbia University with her research on this, and Paul Balke, the CEO of Nestle and many other speakers. So I think a fantastic program ahead of us. I'm sure you will love it. Please make it really a dialogue from your side, and I hand over to Esther for the first topic. Thank you very much, Esther, and thank you to the panel. Good evening. That's about all I'll say in Swiss German, but before I introduce the panel, I'd like to introduce the audience. Our goal is indeed to engage in a discussion, not simply a bunch of speeches. So among you, how many of you live in Davos? Raise your hands. How many live in Switzerland? How many of you are work for a company or are in a profitable business? How many of you work for a non-profit company? And you can raise your hand more than one time. How many of you are students? Press? Okay, if you press, we will try to be quotable and clever. How many of you are forum participants? And how many of you work for governments? Okay, so it's a pretty diverse bunch. How many speak English? I guess everybody without a cup for it. How many? Okay, good. So what I'd like to do is start out and ask each of the panelists to introduce him or herself very briefly. The topic today is models for NGOs. There's not a single model, just as businesses have different models what they do and how they charge for NGOs. Perhaps come in three big buckets, the ones who deliver services, the ones who advocate for somebody else to do something, often for governments to do something, or sometimes in the case of health for people to eat better so that we solve the problem of obesity. And then ones that operate as watchdogs, watching other people. Obviously there is overlap, and we may, during this discussion, come up with some other models. But we'd like to talk about that and who these NGOs are accountable to. A business is traditionally accountable to its owners, but it's also accountable to its employees. So is an NGO in the end. So that's the framework in which each member on stage will introduce themselves. Then I'll ask a couple of questions and then if you start waving your hands, I'll stop and you can begin. So we'll go in this direction because David Nabarro asked to be near the end, so we'll start with Ken Roth of Human Rights Watch. Thank you, Esther. Is it working? Can you hear me? Thank you. My name is Ken Roth. I'm the director of Human Rights Watch, which is a global international human rights organization. We work in about 90 countries around the world. And our business in a sense is to hold governments as well as businesses accountable to international human rights standards. People also ask to whom are we accountable as an organization. We find that in order for either an NGO or a government to be accountable, step one is you have to know what they're doing. So step one is a question of transparency at some level, access to information about the conduct that you're going to be assessing. We're going to be really brief. You have to be accountable to your moderator first of all. I guess I can only introduce myself. We'll come back to this later. Anyway, more later on. My name is Amit. I'm a global shaper from the San Francisco hub. I am a technologist. I work in Silicon Valley. I used to be a Google for many years, venture capital, just left to do a startup. But I'm here today in my capacity as a founder and I guess executive director of my nonprofit. We have built a crowd source and crowd funded hospital in rural India. We just finished it about a month ago. And so you are in the delivery business with this hospital primarily? I guess I would say in the infrastructure building. But you're delivering a service or building a building. I mean you're not advocating for the government to run hospitals. You're running one yourself. That's right, that's right. And to whom are you accountable? Who pays your bills? If you do something bad, who will stop you? I'm accountable first and foremost to society but more specifically to my donors. I have a huge base of donors. My average donor maybe gave me 10 or 20 dollars. But I have had donors that have given me 20,000. And I would say I'm accountable also very specifically to my partners. We have built this effort by connecting with a lot of other different organizations and every other organization has given us a little piece. So that keeps us all in checks and balances. And to go back to what Ken said, transparency. Are you on a website? How do people know what you're doing?  We also have a Facebook group. We also have a Twitter account. We have leveraged social media and we are very transparent. Our work, our photos, everything is posted. Anybody can email us or reach out anytime and ask us questions. And so I would say there's really one kind of outfit missing on this panel, which is the press. Because the press provide transparency from the outside.   It's just worth keeping all this in mind. Self-generated transparency is different from external transparency. Which is why we have watchdogs, which leads us to Charlotte. Hello, my name is Charlotte Piotr-Gonicka. I'm the director general of Swedish International Development Cooperation Agency. That was my two minutes. In short, SIDA. I have a background in the NGO sector, both in Save the Children, in Sweden and internationally, as well as in Red Cross. Cooperation, development cooperation, it's important to stress cooperation. So working with NGOs and enabling NGOs to working countries are at heart of what we do. But we want to challenge NGOs to really think through their role for the future. And to dare to think about exit strategies. We support media because we try to enable societies to build institutions. And media is so important as a watchdog. So it's part of what we do. And I think we will come back to how we want to discuss the NGOs further. So I'll stop there. Okay, and this notion of exit strategy is very interesting. We'll come back to that as well. Naidu. Hello everybody, my name is Kumi Naidu. I'm from Africa. I'm the head of Greenpeace globally. I am wanting to take a phrase from Charlotte. She wanted to challenge NGOs. I'm partly here to challenge governments and businesses for largely paying lip service to the important role of civil society when in fact to a large extent governments and business actually only value the service delivery role of NGOs but don't actually really embrace the more important role of advocacy, challenging governance and so on. And I should just say one personal thing which is I got a lot of my training, early training from within the South African Liberation Struggle and joined the NGO sector in South Africa after Mandela was elected and after the first democratic elections in South Africa so many people moved from the NGO sector to government that we jokingly used to say at that time the term NGO in the South African context no longer stood for non-governmental organization but stood for next government official. Thank you. Thank you. Thank you. David? Hello everybody. I'm a medical doctor. I worked for my first five years in NGOs in Asia mostly. Then I went to university and taught. Then I went into government and now I'm in the United Nations. My passions are equity and sustainability. My work is to make the international system work better on agriculture, food, nutrition and health and in terms of personal accountability I report to Ban Ki-moon the secretary general but we frequently have debates as to whether our primary accountability is to the 192 governments that are members of the UN or as it says in the UN charter to the people of the world. I have one small point that I think some of the current challenges faced by global governance may be because civil society and social movements have not been involved in governance and so I'm particularly involved now in models of global governance that involve social movement, civil society non-governmental groups within the proper governance structure. Yeah, so what do you do when there's a bad government that's one of the governments you're accountable to? Well, that's you see in a way where our let-out clause is because our fundamental accountability wherever you are in the international system is to people and the going back to the UN charter it is about equity of people's development. Increasingly it's also been coming to include equity for future generations so we're also focused on environmental sustainability but absolutely that is the continuous challenge that we're working in and one that I relish. I think these kinds of difficult challenges is what we're all expected to do in our system. Okay and finally Jim Roth, just Ken Roth is the one who is not listed in your list of speakers and Jim is the one who is. Thanks Esther. I run a a profit with purpose private equity fund $135 million private equity fund that makes investments in businesses that supply insurance to low income people in Africa and Asia and we invest in businesses that provide quality relevant and affordable products to their customers and treat their stakeholders decently. My background is similar to Cummys I started off in an NGO I founded an NGO that worked in South Africa on the rights of farm workers in South Africa and then moved to the UN and it was part of my experience working in NGOs that sort of led me to pursue and co-found leapfrog, some of the challenges that I experienced working in the non profit sector. And to whom are you accountable? I'm accountable to our stakeholders, the principal stakeholder of course our investors and our investors in our particular case have both a commercial and social make commercial and social demands of us. And so I mean that's a difficult one do they say we'll take less profit so that you can be nice to people? No they don't and we don't we're enormously focused on making private equity style returns and that's tremendously important to us and a very central part of our philosophy, what we want to do is achieve impact at scale and we believe that the only way that you can really achieve impact at very significant scale is if you unlock the gates of the capital market. So for example if you took all the biggest foundations and you added them together and you distributed the amounts that the world's largest foundations have and you distributed amongst low income people in the world everybody would have a few dollars for a few days but in the capital markets in London and New York there are absolutely vast pools of capital that could be entirely transformative and the only way that we can really unlock those is by providing the kinds of returns that those investors would like and we found businesses and I'm happy to describe them that both do social good that treat their stakeholders fairly and decently and that are profitable at a private equity scale. So in theory you're actually just a model for a decent accountable business that doesn't exploit its customers rather than... In essence yes, I think that's a fair description. So does anybody want a second crack at the bat or then I'm going to ask a little more, yeah go ahead Kumi. I just want to enter this conversation about NGO accountability which is on the table. There are sometimes people who say all governments are accountable to their electorate businesses are accountable to their shareholders and you folks in the NGO sector are not accountable to anybody and you have a free ride. Firstly, I think it's important to recognize that the debate is much more nuanced than that.  Businesses as we've seen repeatedly, some of the most performing CEOs get the biggest bonuses and so on and they seem to have an ability only recently it's been impacted to actually leverage humongous amounts of money for the activities whereas with NGOs for every single sent that they receive they did not receive it on the basis of obligation. SIDA is not obligated to fund any of its partners or funds or any other foundation and so on. If you do not perform and that is a really powerful principle. Is it sufficient? No it isn't and it's not sufficient and I just want to say because I realized from chatting with the panel some of the panelists earlier that there might be an information deficit about how much of work has gone on I should tell you that Greenpeace for example together with a range of the biggest international NGOs under the leadership of Civicus General of Civicus, Danny you should just wave your hands so people can come and ask you from Sri Lanka they led a process which ended up in something called the International NGO Accountability Charter and that is a charter that any of you can go on to the website read it we reported it in an annual basis and that was something we did as a act of voluntary accountability so that we would say to the world these are the standards by which you must judge us so the only concern I have with the accountability issue and our governments and certain foundations have sought to engage with it is that I think to a large extent it's been very technocratic and technicist and all I would say is that we need to remind ourselves of a very powerful quotation from Albert Einstein when he once said not everything that counts can be measured and not everything that can be measured counts right and we need to understand that the process of consultation of accountability and so on is more process rather than individual sort of moments of product delivery and Ken has a brief comment very much along the lines of what Kumi was saying there are various kinds of accountability I mean one of the simplest kind you know you're accountable to your boss if you don't do your job you can get fired I mean that's one form that everybody is familiar with another form which governments like to talk about and Kumi just alluded to this is accountability to an electorate you know the government say we were elected therefore we're accountable there's a problem with that kind of accountability it's a very important one but it has its limits first of all electoral accountability is by definition majoritarian accountability but what if what you want to do is promote a minority point of view is there no legitimacy to that and then just kind of majority votes if your aim is to promote something that's not the majority point of view the other problem with elections is that they're a very crude instrument I mean I just voted in a presidential election in the United States and you know I like Obama but I disagree with certain things but I had one vote so I may dislike his Guantanamo policy and dislike his policy on torture but like other things you're sort of stuck with that what you need to supplement that is civil society and the press the ability to sort of debate issues in between elections in much more refinement than your one vote every four years permits you so that's really the third kind of accountability which I think is what applies most to NGOs and that is an accountability to public opinion it requires you to be transparent so people know what you are but then as Kumi was putting it it's sort of you perform or you perish once people know what you're doing they either like it and the press writes well about it and donors come to you or they dislike and you're criticized and you're not supported but I think that that sort of competition in the public marketplace of ideas and opinions is in essence it's a third and really the only form of accountability that in the end NGOs have we all know how to say we're accountable to some people out there but what you need is really that public opinion to hold you to account yeah and there again I think often the press doesn't do its job there are some extremely well or overpaid NGO CEOs there are NGOs that basically are a family run way of sending money off to your relatives who work in the NGOs and it may be that we simply we need to have more transparency requirements and we need the press to do a better job but this point the purpose of an NGO much like in a market not everybody wants the same brand of toothpaste not everybody wants the same brand of president but they're stuck with it but if you want a different brand of minority viewpoint or you want to uphold something that's not generally popular that's where it works so we're ready to do some audience questions I mean there's also a lot more to be said about how how this accountability works you take somebody like WikiLeaks which was not accountable to anybody it raised money Julian Assange went off and became kind of crazy then it was unable to raise money then other people started donating money so it's there's the short term and the long term both in terms of measuring impact and in terms of how accountability works sorry I think it would be inappropriate for me to not respond to the use of the word crazy because as Albert Einstein once said that you really like him today I like him maybe tomorrow I'll be quoting Archbishop Desmond Tutu Moore but any idea that is not absurd and crazy at the outset is not actually worth pursuing I don't know Julian Assange I don't know WikiLeaks itself but however yes I know Sweden does however however I think it's really important that we recognize make a distinction between the vision and mission of what an organization has been doing and any faults that there might be in leaders like ourselves and I think the purpose of WikiLeaks is a purpose that we must defend I hold no brief for them but the fact that our governments operate with a level of lack of transparency and get away with torture, murder and terrorism around the world is not acceptable I mean you know and look at the way that the young soldier that leaked the information is being treated I mean it is abominable it is absolutely abominable and that's why much like Ken President Obama when he was elected you know I didn't sleep for like three days and then he's been coming down like that and that's why today you have posters coming out where you have a picture of Martin Luther King where it says I have a dream and you have a picture of Barack Obama where it says I have a drone which is one of the worst human rights violations I think we need to challenge you a bit and then I want to challenge you Can I just say that one of the challenges for the NGOs sector is that a governmental agency like CEDA we are actually prioritizing today to give funds to NGOs who does net activism who are active in really working for freedom of expression in this new landscape and we are more interested in getting to know them more than we are interested in getting just the traditional same service delivery proposals from actors not being complimentary but being kind of old fashion so we are very curious what is in this new landscape challenging you I want to raise a question about accountability and let me ask you Ken you're in the business of human rights watch suppose it was 1943 somebody came to you and said I would like to go murder Hitler would you have been able to support him or are there some things that people need to do who are unaccountable that society cannot do well I think any organization has its mandate so human rights watch doesn't fight wars and doesn't kill people doesn't kill people so I think maybe our role in the situation like that would be to assess is that a fair thing to do is not and obviously Hitler in the midst of a genocide and leading a war is a combatant he was a legitimate military target so in that sense if somebody wanted to go out there and try to fire at him it's no different from shooting at a general on the other side that's what the Geneva conventions adopted after the Second World War say part of accountability is accountability to what principles what standards and for human rights watch we are very clear on the rights and humanitarian law which then actually gives you an answer to the Hitler kind of question even if we're not going to be the actor okay thank you I just wanted to bring that out can you please bring the gentleman in the front row and if you don't mind saying unless you're a principled anonymous person say who you are we're trying to censor this gentleman hello thank you I'm a member of the European Chamber an organization representing businesses we are also an NGO because we are an international organization new but we redistribute resources NGOs are we are complementing and also correcting the action of governments of states so we redistribute resources every NGO redistribute resources members and money got from donations regarding donation and money I have two important issues regarding financing questions right receiving donation from donors with questionable ethical background even states some states have questionable ethical background and the second one how to deal when collecting donation implies too high administrative let's say of commission cost I've heard about huge NGOs giving more than 50% commission to people knocking doors asking for money so how do we tackle with this problems Ken wants to take it and then other people I mean those are both important questions I think that every organization has to set its own standards here mine we're actually very careful about who we take money from any government we would never take money from CDOP we need to be independent of governments so that's one standard we set when it comes to private individuals we won't take money from people who have been complicit in human rights violations because that would be hypocritical as defined by you defined by international standards but then we investigate it so we do do diligence on our donors in terms of the question how efficient is your fundraising there are broad standards but I think that that's frankly something that donors should ask about and look to and those are for the most part published but if you see an organization that is paying 50% 50 cents to raise a dollar that's not a very good investment and that's probably not a good place for you to put your money so as an informed donor those are precisely the kind of questions you want to ask Jim talking from my perspective I think one of the things that I really like about being in a profit-with-purpose business is that we are very accountable to our investors and we're deeply regulated by the kinds of investors that we can accept and there's a whole range of requirements that are regulatory requirements that we have to comply with and I guess one of the concerns that I have for NGOs and for the future of NGOs is that there doesn't seem to be the same level of regulation overt regulation as there is in the private sector and I can understand the private sector has been hauled over the calls and rightly so over the last decade at least but I think that's one of the really big challenges that the NGO sector has I think the other point that you raise I think is another real challenge with NGOs which is the raising of money and I think that is a major problem in the model because the leadership of NGOs that was certainly my own experience spends an enormous amount of time raising money and this is often very distracting from running the business because there is no model but I don't see any particular way around that because ultimately it's a non-profit and it has to raise funds but I do think that that is a real challenge with the model. I want to expand a little bit on what you said not accepting donations from somebody who has maybe a criminal record there's also donors that have certain agendas that are not illegal in any ways could preclude you from accepting the donation so for instance in my case my organization does not accept donations if they're coming from an organization that has a religious base or a political base because we don't want our hospital to be hijacked by other interests that was a cautious decision that we made and it's in our charter for the second issue that you raise in terms of the commission it has caused me no grief and I totally agree with Jim we spend 60%, 70% of the time just raising funds and I have been in situations where I had to put my own credit card on the line I have to incur expenses and the regulatory schemes that have around me didn't allow me to work around it and it constrains me a lot and I unfortunately don't know the answer if there's anything that we could do better can I just oops sorry at Greenpeace we don't take a cent from government or business for the similarities that Ken mentioned we don't take money from any business entity either because the reality is we have campaigns against more than 50% of the companies that are attending the World Economic Forum for example at the moment it would make it a bit but on this issue of costs I do think it is a very complicated issue and there are some very objectionable practices such as in a few cases it's being done away with where a fundraiser gets paid on commission so that you know an NGO leader would tell you I need you to raise a million and the person goes and then there's sort of a percentage splitting on that was dominant in certain parts of the United States in particular that's been eroded but when I think of how we raise money which is engaging what we call direct dialogue it does cost us money to have activists on the street but I always go out these are the most hardworking people in Greenpeace by the way the ones who are on the streets I always go out with them when I'm on the field and when I look at that 20 minute conversation that they have with a person that stops to have a conversation with them it's not a fundraising thing in itself all the conversation leading up to the fundraising ask is actually a campaigning conversation saying this is why you should be concerned about forests, oceans, the climate and so on so in that sense depending how the fundraising is done even if there are costs there might be non fundraising benefits that need to be factored into so in a sense what you're saying is as you fundraise you're also delivering part of your mission go ahead and then I want to ask maybe to make this more complicated some of the fundraising is being done in the north hemisphere for the south hemisphere and what I've seen too much of is that the fundraising is built up on good communication good or bad communication and it's about perception the donor and I'm not talking about an agency I'm talking about a private individual who decides where to put a pound it's very much there is no it's hard to actually distinguish who is doing a better job because what we know is who's doing the best communication because what's being done is done very far from you and it's hard to judge and I fear that some of the organisations are putting more money in fundraising strategies and communication strategies then they do an excuse me for the word in product development or solution development and I'm challenging this as long as we have a north-south as long as the donor is far away from the delivery situation that's a danger because then that can continue because nobody's challenging what works at the field level to know as a donor not how good you are in communicating and I think that's very very important to challenge so if I were to start a charity it might be one that was devoted to creating more transparency at the point of delivery for many of these things please do some due diligence before you set up that NGO because it's at least about 10 organisations that are doing that in different parts of the world I'm talking about press again journalists real journalists but just a quick poll and then this lady here had a question so who thinks and we'll ask the audience as well who thinks commissions are inherently wrong as a way to raise money you certainly I think can I suggest maybe that that's too strong there's a very minor issue there are bigger issues and I'm sure the audience it's interesting if commissions are effective are they immoral I don't know I just don't think we should blindly dismiss them I don't use them but I don't think they're immoral it's just another form of compensation and as long as they're not excessive with respect to the amount raised I don't think there's anything inherently wrong with them the problem is when there's no gaps no limits put it's my job to make you accountable to your wild statements my name is Kavita Ramdas and I'm the fourth foundation representative in New Delhi and ran a non-profit organization the global fund for women for many years in San Francisco prior to this I just want to say I think particularly being at Davos in the context of this extraordinary private wealth and the discussion around the private sector and then this discussion about the NGO sector I find it kind of somewhat disingenuous there's a huge amount of pressure on non-profit sector to become more efficient and more business-like yet when we use strategies including good communications including getting commissions including paying our our best staff the kind of salaries that actually would attract terrific people then the for-profit sector suddenly turns around and says oh my goodness what are these people doing you know they are not mother Teresa they are not Mahatma Gandhi they should be doing this for the service of the poor and on the issue of looking at the question of delivery on the ground you have no idea how social change happens whether you are sitting in New Delhi and you're looking at this young girl being raped and you're seeing what has happened on the streets and you see 7,000, 8,000, 10,000 people pouring onto the streets and you don't actually know whether the grant that you made to 20 women's organizations over the last 20 years which has built a capacity it really doesn't matter whether you're there or not necessarily I think it makes you feel better it makes you think that you know but honestly rich people no matter where they are whether they're in New Delhi or whether they're in New York are not inclined to go walking around the streets of Harlem or to go to the Bastis of Delhi which is actually happening so let's be very careful when we talk about what it means when we're expecting NGOs to deliver on a set of accountability structures on which we don't actually hold either government or the private sector to anything close to the same standards and then lastly with regard and then lastly with regard to you know money, an old friend of mine a community organizer in Chicago once said make no such thing as tainted money it just taint enough and what is tainted money Ken cannot take money from government or from certain companies that invest in arms but do we know where rich people make their money from do we know that each of us who work for even foundations like Ford or MacArthur or Gates how our money is invested what kinds of companies, what kind of behavior you think private equity is okay do you really know what kinds of investments the mining companies that are coming to India today that are completely destroying our earth and our basic resources that the Indian government is saying FDI fantastic foreign direct investment so let's be careful when we use these words I would just encourage us thank you thank you Jim wants to respond then I have a comment just to be absolutely clear I'm not saying private equity is okay I'm saying the particular social investment fund that we do which is based on a private equity model does good and we measure impacts and we ensure that good happens that's the that's the assertion I'm making for what it's worth Pierre Omidyar the founder of eBay created a huge fortune and started funding nonprofits and discovered it just was too complicated there were too many regulations about what you couldn't couldn't do and how you kept your books and if you did such and such a thing you were no longer not for profit he said screw it I'm a business guy I'm going to invest in companies that do good for profit maybe we won't be quite as profitable but we're simply going to have more freedom to do what we like and I see that happening more and more perhaps mostly in the US but anyway there's a question there's a limit to that at the same time has humanity united which funds human rights watching lots of NGOs so he does both things but the idea that for profit is going to give the answer you can't do what Human Rights Watch does for profit there's lots of things if you insist on a profit it's never going to happen so you got to accept that certain things just require an NGO sector absolutely I think when I come to the conclusion of this panel it's going to be there's no single answer there's no simple answer there are lots of different ways to do it corruption shows up anywhere David and then the man in the red shirt and then the guy in the suit there who must be a business guy because he's wearing a suit David I'm never comfortable at this sort of point in a discussion when somebody says there's no answer of course there are answers no single yes there's no single answer but it is worth dwelling for a moment on what Kavita Rondas just said about in a way the purpose of activities within civil society and perhaps even the purpose of action within societal movements of all kinds many of us who've been active in this area have learned that there is a tendency on the part of those who provide resources be they foundations or governments or businesses to want to be able to come out with a very simple purpose statement of what the resources will deliver and indeed there's a degree of viewing that goes on so that easily measurable deliverables sorry about the syllables get prioritized often in funding discourse especially if there are anxieties about the governance and therefore also the money handling capacity of an entity but the transformations that occur for example in Sahel where societies are being stressed by recurrent droughts and difficult politics the transformations that occur are often not led by governments who are eligible for monies from donors they're not led by institutions who can open a dialogue with the Bill and Melinda Gates foundation they're led by very informal groups of extraordinary people who are the real transformers and so I'm kind of interested in really teasing out some of these issues the world will transform in a better place through the actions of some of the most humble and invisible agents for social change and not through big inter-governmental NGOs with lots of accountants who can show where every penny has gone and so for me and why I was so pleased to be on this panel yes there aren't answers but there are really interesting ways to frame the questions. Thank you very much Kavita. Thanks and new models. Charlotte. I said in the beginning that I wanted to talk about exit strategies and it actually has to do with the role of an INGO because reality and rhetoric has been for so many years that the role has been to build capacity in a country and if you're true to that mission you have to come soon related to a situation where you're not successful so you're not needed but are you true to your mission enough to actually plan for an exit are you true to your mission enough to say the international added value in the chain of cooperation is not adding any value any longer because there's so many other actors there's technology there's so many other things taking place so we actually don't need to be here and I don't know if that's happening that's discussion enough and if we are challenging some of the international NGOs and obviously a governmental agency can enter that debate and discussion and provoke that discussion with an open mind kind of and with some humility as well because the issue is where is your accountability your accountability is to your government your governments I mean SIDA is a government agency the government what we have is a problem in the developing world is that what is often put to us as philanthropy cooperation and so on is actually serving the agenda of that government advancing its own interest and I can give you examples of Sweden and South Africa around certain arm deals and so on which were part of how the conversations actually happened so I absolutely fully encourage that you have a voice in this conversation absolutely and I think it's a good provocation to us but I do think the starting point has to be saying well actually my own basis of entering this conversation is actually on pretty shallow ground because in fact my starting point is my accountability is to a government which is open to the vagaries of elections and imperfect Jim quickly and demand the red shirt I guess for me the challenge has been that there has been an enormous spotlight placed on the private sector and rightly so so you know you can open up the newspaper you know any newspaper any day in the last 10 years and if there's a story about there'll be invariably be some story about you know a business that's you know done something wrong and cheated the public and lied sorry to get the point and I think that there's been relatively little light shone on NGOs and their activities and I think it's been predominantly on the private sector I think it's been predominantly on governments I think that there's an assumption that NGOs are the good guys and I don't think that's good for the NGO sector the man in the red shirt if you speak in first of all I want to say NGO means non-governmental if an organization receives money from the government it's not an NGO anymore secondly as an Indian philosopher said as soon as a good idea gets institutionalized it becomes corrupt third, the moderator said that we can ask questions in a democracy the civil society also can make comments then the next point is if we say how much money we give to the south we also have to say how much the south is paying to us for example the third world we have three times more interest than we are investing in so-called help business this is just a shame on us and it's all together with tax evasion and all this it's more than ten times more what the poor are paying to us so this is a business with poverty it's unacceptable and I think today we should focus not only where the money is going to we have to focus also on tackling the symptoms or are we also tackling the causes of the problems for example the family planning because of population growth or also what are we doing that the money of the rich is not growing in an exponential way and as a last point I want to say private equity private is a Latin name and it means stealing thank you for your comments now the other guy in the suit thank you I run the Nature Conservancy we're a big international NGO so I may be biased here because I do want to defend NGOs but I've been in this role for five years prior to that I spent 25 years on Wall Street so I actually have invested more of my life in the private sector I'd like to defend NGOs and object to some of the generalities that I've heard from the stage today I don't think Pierre Omidyar Esther has really criticized NGOs or nonprofits as organizations they can't get things done he's criticized the regulations that restricted him the implication of your comment though I object to because I wish people would pick their words more carefully because your comment suggested that he chose instead to invest for profits because he could get more done I don't think his own actions support that comment the suggestion that there's no scrutiny or disclosure of NGOs I think is absurd I'm most familiar with NGOs headquartered in the United States we disclose to qualify for our tax exempt status we provide ample financial disclosure it's available if you're interested the suggestion that we spend too much money communicating to me is absurd our job is to run our organizations we have to raise a lot of money to be sure it's hard to do most funders encourage us to communicate more clearly what we're accomplishing indeed your own question suggests if we knew more about the results of what you were happening accomplishing that would be helpful that's what we seek to do through our communications the folks need to understand funders sometimes suggest a comment came up in the stage it's hard to know what's happening yes there's an investing side to the world investors invest in private sector companies they work hard to understand what the companies they invest in are accomplishing they look at the financial disclosures and work their way to understand that they pay attention some funders prefer one kind of company investors others and other ones great there's glib comments made oh the big international NGOs are the bad ones they should exit more others say small NGOs are the good ones all these NGOs that are surviving are working hard it's not easy raising money they're probably on the by and large doing good things and the criticism general criticism is really not that useful rather it's specific if you have ideas on how NGOs can do their job better that's very helpful if you're a funder and you have ideas for how to improve let us know but general criticisms disclosure should be better too much time has spent on communication what should the right commission be for fund raising I don't see those sorts of questions recklessly being applied in the private sector thanks okay thank you finally this woman that I'm pointing to here in the third row and please also let us know who you are thank you my name is Michelle Arevalo Carpenter I'm the overseas operations director of a small but growing NGO it's called Asylum Access we advocate for the rights of refugees in the developing world and my question I'm hoping to insert one layer that I was hoping to hear more of today is the generational layer okay our NGO is only six years old and over the first year the CEO was also the envelope stuffer was also the receptionist and accountability in the US anywhere else is expensive even if it's paid with resources with time there's only so many hours we can really work how can we work together as a sector to give each other a stronger holding hand for the next generation of NGOs to flourish that's my question thanks so let me take this question and embellish it slightly more she talked about generations and I think this is probably both generations of individuals young people generations of organizations startup NGOs how is the world different when you can start an international NGO using the internet in a very different way when you can have a website and show what your hospital is doing to somebody in Minneapolis if you take that great question and put it in the context of the topic which is NGOs as new models in the 21st century I'm going to shock a lot of people now but I would say that NGOs as we currently exist are not new models for the new century we have run out of steam if we continue you've put your finger on a very important issue the aging of the NGO sector no seriously if I look at Greenpeace when Greenpeace started the average age of Greenpeace leadership then and what we are now I won't give you the figure I don't want to have the exact one I don't want to be out accountable for it but I want to make the most controversial comment provocative comment about where we are and why we must be consistent in the light of the last comment as well the World Economic Forum is an NGO we say as one of our values and I know I might not be invited back next year but I'm going to say this because I think it must be said that what we say is that we don't want our leaders in government or even in business to stay in position for too long that we should have a culture that says no human being is indispensable that people come they serve one term, two terms and they move on is it why yeah we have a conversation about NGOs why don't we ask the question Professor Klaus Schwab somebody who I like and respect but he runs the risk of becoming the Robert Mugabe of the NGO sector in terms of the length of service that he is no no if you want to use language let's talk about it in an honest way because nobody should have a culture because part of what is lacking in NGOs and I would say including my own is we do not have a culture of succession planning of opening up avenues of new people coming in and if we continue like that I certainly don't want this to be the new model for the 21st century we need to open up spaces and be more open and I recommend all of you who are interested in the subject to buy a book called Spider and the Starfish because a spider is hierarchically structured as most NGOs are you cut its head, a spider dies a starfish which is what your question talks about the social media because Occupy and all of these new movements they have actually had more no NGO really can claim that they were big part of the Arab Spring we might have helped here and there but that was a starfish you know a starfish cut off one of those thingamajigs it grows back and grows into another starfish and you know take archetypal starfish organization of the past was Alcoholics Anonymous you know nobody knows who's the founder who is headquartered and so on but every community you go to anyway in the world we're doing the same 12 step program and that's what we need, we need organizations and movements that are not that's the new models we need highly centralized just doesn't work in the new social media context I'm not quite sure if you were being hopeful or not but I guess I represent the young generation here and I see a lot more good things happening in the world and in NGOs and all of you here have dedicated your lives and careers to it I'm barely starting in my career but I'm just going to use my own example since that's the one I know I couldn't have done what I did five years ago all these new tools that exist have allowed me to collaborate with thousands and thousands of people spread all over the world and I also want to recommend a book The Dragonfly Effect you can read about it it's essentially the thesis is that action multiplied across lots and lots of people can create a giant movement we saw that happening in Egypt and I'm more hopeful than you on that front but I do see new models coming I am seeing the NGO world at least in my generation the 20s and the 30s people are actually thinking about planning and succession and they are adding governance and maybe maybe what we need is looking a little bit more at the young people so I'll leave it with that hope here there are two approaches to this one is succession planning perhaps and the other is simply the world is getting more decentralized and it's much harder to stay in power whether you're a large company a large press institution governments tend to persist longer because they have monopoly powers like Mugabe but a lot of things are being eroded around the edges it's just simply one person has much more power now and Ken had a comment when I grew up there was an ice cream shop in town which would have a new flavor of the month every month and so they'd have all the regular flavors but they have a new one and this was sort of the exciting new thing that everybody wanted to have and sometimes discussions about NGOs are a little like the flavor of the month because there are these enthusiasm out there today small is better young is better social media is better there's always an element of truth to that the flavor of the month was often good but you've got to be a little bit more savvy and pragmatic about that we grant for example in the human rights realm local human rights groups are a very important part of the protective device where we try to defend rights to the international groups then you would have thousands of people in Brussels each for their little NGO trying to influence EU policy in a positive direction and thousands more at UN headquarters and obviously you can't do this they could never afford it to be completely inefficient there are ways in which it's more efficient and more effective to have an NGO group involved in that or take social media I love social media I'm a big fan there's a lot of knowledge and intelligence that just trickles up through the network but what social media often lacks is the ability to develop in-depth expertise over time so if I want for example an expert on human rights in Uzbekistan somebody who has been following it for years who really understands how awful it is what the pressure points are how we can change things I could ask social media and I might get a right answer I might get a wrong answer you don't get the kind of depth of expertise so you look to social media for certain things it's a great way to kind of collect common wisdom it's a great way to get the word out but it's not necessarily a great way to develop long-term in-depth expertise so my advice is when you hear the flavor of the month be a little bit wary there's probably an element of truth in it but it's rarely the panacea it's rarely the sole answer when did you go home last? to the flavor of the month is it the week yet? I know it's probably a flavor of the minute and then there's a question right in the middle actually there's two I guess Ken, notwithstanding I think you're right, there are trends I do though I'm quite sort of sympathetic to Komi's point that there does at least in my experience of working for many decades in the NGO sector there is this absolute trend of leaders particularly in the more prominent NGOs fairly much forever and I think the NGO sector needs to understand that when the public sees that it begs questions of accountability and there's no real way around that it may be that they are the best placed person to be there and that there's democratic processes that have put them in that place but it doesn't look good so we're going to change the format slightly because I see too many hands being raised would those who'd like to ask questions just line up over there because I want to make sure we hear each question or comment before the end and if you all see how many people are behind you that will encourage you to keep your comments, your questions or your responses short so if you'd like to talk to the mic do just make your way over there slowly and we will get everybody if possible before 2 o'clock sorry for the disruption but I think it's the best way so let's take the first person hand them the mic and we will respond but we'll try and be brief too she says encouragingly go ahead my name is Sarri Refkin I'm the Executive Director of ED the Association of Community Empowerment and a Shwa Foundation my first I have two statements or comments the first is that way back when we talked about NGOs, nonprofit organizations accountability being their board there's a board of directors and the American model the board of directors also invest financially in the organization I have heard nothing here with all the outside agitators that have to see what we're doing the discussion what's the role of the board of directors and aren't they those that make us accountable the second question that I also have is I think that the real question of NGOs for the the next two decades is what is our funding strategy going to be I see that foundation funding is drying up the Ford Foundation and many other foundations have left the human rights field in Israel giving up on the cause that could ever change and if we want to continue doing our work we need to look at other models of earned income and I'd like to hear your thoughts on that as well what we're going to do is collect all these questions I'm writing them down and we'll address them my name is Cyril Altair from Sahih Foundation here in Davos and I would like to ask especially to Mr. Roth and probably Mr. Naidu others who discussed the issue of NGO, a new area something coming could be coming after the NGO area so would it be possible that this is going towards the area of social private equity is that the new big wave and not just the flavor of the months or maybe a new okay so keep that in mind we'll answer briefly I can only really just sort of repeat what Ken said there are just simply things that the sector won't do and can't be done for profits watching human rights abuses it's hard to see how you could turn a profit on that holding businesses and governments accountable for global warming and environmental disasters it's hard to see how you could turn a profit on that so I just think there are things that are simply not going to be done on a for profit basis and I can't see any way of accomplishing those absolutely critical things that we need to do without a non profit sector thanks next question my name is Zabeda Bai I'm from India and I'm the founder of a maternal health organization called ISE I think we represent the really niche part of the social enterprise sector which is like the for profit social enterprises and I can claim that we are only we're the only for profit maternal health entity where do we fit in because when we go to foundations they're like hey hello listen you're not a non profit and then we go to private equity they're like you don't make the amount of money that we actually want you to make but we are doing it in the most sustainable manner selling products that cost two to five dollars for maternal and neonatal health in Indian Africa over the last two years and slowly growing so where does people like us like where do we come from we're not non profit but we are achieving MDG 4 and 5 so what is it that this next wave of generation that is niche looking out for okay yeah briefly go ahead I'm happy to speak to you afterwards I have some contacts that can pitch you where people are doing that but essentially the difficulty you have is what you have is an hybrid organization and the way some others have dealt is that they have actually segmented the two sides of the operations so what they do is they consciously have a non profit arm registered in terms of non profit law complying with all of those laws and so on and then they have a what's called an enterprise arm or the for profit arm and that then conforms to operations now I don't know the details of your operation it might not be that easy to do but I do think that this is a good challenge for us to have and it's a good challenge for us to apply ourselves to and I'm very glad that you raised it because I think over the next decade we're going to see more and more of your kind of organization emerging and I'd like to just echo that because and also I think that what NGOs has done is probably to inspire these new models that we see so we should take the credit for that there are other things growing out of that and when an agency like ours is trying to be a good partner in the country we are actually discussing solutions and not and not to start with is it an NGO or is it this or that and I think that's going to happen more and more that we are actually looking for the goods and that's what I mean by communication strategies be clear on ways of working rather than nice pictures of children if I may and so that's the whole idea around that and I also want to say that we're very very curious around youth and new technologies and if the old traditional NGOs are not curious about that things will change quickly also once I had a little bit I live and work in Silicon Valley we believe in hybrid anything that doesn't make sense we take a look at it and the term that's thrown around for your type of organization there is FOPSIS for profit social enterprise just the term that's thrown out there but I'm happy to talk more I know that there's social venture capital in the valley in Silicon Valley that does support organizations like yours it's worth seeing if you're a public company you have a duty to investors it's really hard to be low profit but there are lots of private investors who will indeed invest in something that's for profit but not very yes sure I think what I'm trying to say is yes we do have like we raised our first round of investments so we do have social investors in our company we do have the Canadian government giving us a grant as well but we're trying to figure out how the Indian government is going to let us take the money as a for profit we've been struggling over the last six months it's clearly something that we need to do as a grant which is like monitor and evaluate the impact that we're doing but we've been struggling for six months with every accountant and I've spent a lot of money that we raised as an investment trying to get this grant money in and actually do what we're trying to do so I think the system has to be ready for it it's more about how are people like us going to be supported eventually in future rather than just think about NGOs and accountability I think accountability for us taking both investment and grant money yeah this goes back a bit to what I was saying about PROMDR it's simply sometimes the regulatory constraints are very complicated and one is to take the grant not to the organization but to have it given to a third party to do something for you but let's go on to the next few questions and we will not forget the first question I wrote it down my name is Dr. Annie Sparrow I teach humanitarian aid and human rights amounts on our school of medicine and I wanted to raise the question and probably pose it to David and Petrie about the fundamental discord between accountability to the beneficiary and the accountability to the donor and I say this from the point of view I used to run UNOSS Malaria program in Somalia for the global fund performance based funding and I spent a great deal of my time an enormous amount accounting everything down to a sense I can explain this is what a Malaria net cost this is what a cost to ship to Mombasa this is what you know it costs you know $1.81 for a conical net a cost this much to ship and then you have to pay the pirate tax then I have to pay every single checkpoint and I can explain actually down to a sense how much all the additional checkpoints, corruption pirates can cost that's what the global fund demands that takes an enormous amount of time when you're talking about you know someone who's trying to get service delivery on the ground and we talk about accountability to the beneficiaries because that's what we're in it for at the same time the beneficiary of the Malaria net I'm only allowed to give Malaria nets to people who are going to use them as Malaria nets they might want to use them to pull their house together they might want to use a fishing net they might want to use it in any manner of ways and I agree with that I think you can do whatever you want with it but it's useful to you that's a very very good thing you can sell it again in some way we've lost the why we're actually doing being accountable in the first place and we're in danger of losing it all together and that's really the issue I wanted to raise okay thank you I'm accountable to the organizers here to finish within 10 minutes to hear all the questions each of you a chance to respond very briefly we're not trying to answer all these questions we're trying to raise them so next three people quickly very briefly my name is Steve Davis I'm the president and CEO of PATH a large global INGO doing technology in global health but I guess I raised my hand really in response to a question number you know that this the business model is not evolving I mean my view is that they're just as the private sector and I come out of the private sector I also came out of human rights sector I have all of these sectors these institutions will survive by evolving that's no different in the NGO sector than in the private sector and as a result we see a lot of very very smart NGOs doing all sorts of new models hybrid business models you know value for money methodologies for thinking about how you actually move forward I see succession planning new generation training this is the idea that there's these old NGOs and then the rest of the world I think is really misguided and doesn't do any of us a service there's a lot of excellence in the sector so I support my colleague at Nature's Conservancy to say you know I'd be careful that this language doesn't actually support things in a way that we don't intend the second I would like to raise I actually put the surprising dialogue that I've heard today about the being the sort of facilitator intermediary between sectors to me the evolving 21st century problems a lot are going to come only through cross sectoral solutions whether it's how Pierre did it or others and the fundamental role of an NGO can be how to support in a market failure environment new innovation how do you actually pull the parties together and that's actually very powerful and I haven't heard much of that today and let me just note the difference between evolution where individual things die off so that progress is made in general and learning where individual things learn and change internally next question thank you I'll be brief too I'm Philip Wilson Schwab social entrepreneur ex banker and private equity investor etc I have two comments my uncle was the president of Guatemala and he was involved in signing the peace and he said the hardest thing for him when he was signing the peace was the NGOs were very difficult and it seemed like they wouldn't perpetuate their existence by not signing the peace I didn't disagree or disagree but it was an interesting comment 15 years ago 15 years later I became a social entrepreneur and what I found and I don't want to make a blanket statement there's good and bad NGOs but what I have found is that the larger the NGOs the more they're focused on the bureaucracy and less on the mission and the smaller in a place like Guatemala because they only have experience in Central America the more they're focused on solving the problem and having an exit strategy which I think was the most important thing said today so there's a lot of hope out there our mission is to solve the water problem $35 water for life and the small NGOs are taking that and running with it and they're saying look we're going to do this because we know we can reduce the problem of water the bigger NGOs they buy the filter and give it away which I don't think is a sustainable but it's good for their donor base so I think it's a question of big and small unfortunately and the smaller tend to be more solution focused the bigger more focused on the bureaucracy in my experience okay so you can go outside and fight Peter Prove from the Ecumenical Advocacy Alliance I'm a member of the Global Agenda Council on the role of faith but also relevantly a member of the Project Steering Group on the future role of civil society just wanted to draw the meeting's attention to the fact that a report, a World Economic Forum report on this issue, the future role of civil society was released yesterday and I think it has some innovative thoughts included in it and one very challenging one and that is how we can move beyond thinking in sectoral terms the first, the second, the third sector should rather think of civil society as the glue that binds private and public action for the common good and I think that's something we can all reflect on but civil society itself has to reflect on the issue will be whether the other sectors are willing to be glued together in this way one point that came up in a conversation we had this morning was as much as we want to focus on engaging youth it must not be at the expense of engaging the aging demographic which is increasingly a global trend we have to be able to engage older people as well and finally on this issue of regulation I think I've heard it from several members on the panel I think one of the greatest threats to civil society at the moment is not the lack of regulation and transparency but increasingly restrictive and frankly oppressive forms of regulation that is killing the energy and the genius of civil society in many parts of the world thank you so is the last person a question or just sitting there okay any closing thoughts brief ones we have the role of the boards and funding so David you thanks very much indeed just for that last kind of rush of points and questions I'd just like to suggest that in a way the point that came through towards the end that what matters is the outcome is where we all need to be sitting we're all part of a mix of processes involving a variety of different individuals and entities that are seeking outcomes to do with equity sustainability dignity and a number of other key assets for the future of humanity the challenge in thinking about new models is how to continue as Peter said right at the end to establish ways in which different groups can work together with minimal transactions for common good it is difficult dealing with disciplinary silos sectors of government or simply straightforward difficulties between organizations that interfaces this is not easy work and it's work that all of us need to work on and find ways to resolve for me the primary new model for the 21st century is not multiple organizations it's not partnerships it's movements movements that bring together a variety of different entities as if inside a magnetic field working for the same goal with strong matrices and with very tough watchdogs to ensure that they're accountable everywhere because mutual accountability is the only way to go thank you but guys you really have to be brief because I need to close it to everything that you said just to respond to it very briefly our conversation we used interchangeably the word NGO and civil society just to remind ourselves that NGOs is only a tiny part of civil society it's trade unions, it's faith-based organizations it's looser movements it's social movements and so on the second thing is I think that last set of comments was guiding us to say that we need to understand that for all the challenges that humanity faces sectors have a role to play government, business and civil society the challenge for us is to understand the comparative advantages of different sectors and what they can bring to the table and they have to do it with something the women's movement tried to teach us decades ago but we refused to listen which is the power of intersectionality which is to understand how race intersects with gender, with class and so on and the sooner we learn that I think the better we'll stand a chance for the children's future and the word catastrophic climate change Thank you, Charlotte I think that our colleague here has said what we wanted to say in the end I just had one reflection on accountability and governments and outcomes are important but we as a government agency we know that the Swedish public 85% of the Swedish public show solidarity it's not the government it's actually what they say and we are not there to kind of tell them that every penny is being spent that this and that they want to know that we show solidarity in outcomes and actions and I think that some of us in this whole business we have lost ourselves in bureaucracy we really need to go back to the important and not become too technocratic and we have a role to play there Thank you, so what you've heard here I think back to the thing that made you most annoyed that you thought was most stupid or frustrating or clueless that's probably the thing you need to pay attention to we're all different have different points of view there's a lot of interaction there's bad versions of something there's probably no model good enough to to overcome bad people there's probably good people who can do something using any model in the end it comes down to human spirit human courage and transparency I thank you all for participating I thank all of you guys for being patient with my telling you to hurry up we're done in time and thank you all very much


Thank you. Yeah, I'm Tyrone Loven. I work at JP Morgan and I'm the technical product lead for an Ethereum based client called Quorum I'm going to be presenting with Ute today on basically consensus mechanisms and permission networks and how companies like JP Morgan and startups like Ami are coming together to really help advance the theorem both in the permission space and also in the public enterprise space so the nexus of the of you know all these themes is really quorum itself and For those of you who are not really familiar with quorum quite simply. It's a lightweight fork of guess And so by that I mean you can take a smart contract that you have written and deployed to the main net And you can deploy it to a quorum network in exactly the same way without any changes Which is amazing, but also not very exciting if that's all that quorum did So that we'll go through some of the additional features that quorum provides as well Quorum is designed to operate operate within permissioned networks So we know who the protocol is geared towards We know who the participants on the network are and this gives us You know some leeway from a consensus perspective as well It makes us it gives us the ability to have faster consensus effectively Ultimately though the reason why quorum exists is to provide Enterprises who want to use Ethereum with the features that they need to operate within a production environment And because they want to use Ethereum know one of the goals that we have as a result is to make sure that quorum stays as close to public Ethereum as possible And this week actually we just upgraded to get 1.7 point 2 which is actually really great news and if you using quorum I think this is something that you know the user community have been looking at for a while So we're really excited about that, but it's more than just that we're also Helping provide standards under the umbrella of the enterprise Ethereum Alliance and really making sure that we are contributing back to the community But again, really the ultimate goal is to have a theorem available to enterprises within the production environment But to do that we have to solve for requirements that enterprises need and the first one of course that always comes up is privacy And from a quorum perspective what we have is the ability to have private transactions private smart contracts and also the ability to exchange assets in a private way and The way that this is achieved is effectively Utilizing two services within the quorum architecture. The first is constellation Which is effectively the core privacy service that quorum implements And the second is a newer one called ZSL which stands for zero knowledge settlement layer Which is a full implementation of zero knowledge proof in Ethereum It's something that we've done in collaboration with the Zcash team very recently and we'll go over what ZSL gives us in a moment But from a constellation perspective If you think about you know, I have an insurance contract for example that I want to deploy With yourself and I don't want anyone else on the network to know what the details of that contract are This is where we can use the constellation features to actually obfuscate that information And so effectively what happens is when I send that transaction into the network. I Make a call to constellation Replace the payload of that transaction with a hash of the encrypted payload and that hash is then globally distributed across the network There's nothing that's revealed about this information But what this does is it gives us some really nice resiliency properties Which we're not going to get into today But the key here is that we actually also have a shadow constellation network that runs in the background And so what happens here is you have point-to-point communication between these constellation nodes of that private information and so you never are Globally distributing private Information to parties that shouldn't see it, but you do end up with this very strong pragmatic privacy solution The side effect though is that if you are not actually part of you know For example a chain of asset transfers, then if you're trying to sell me an asset I don't necessarily have guarantees that you are the rightful owner of the asset or that you haven't sold Sold it on to someone else. And so this is where we we leverage the ZSL implementation. So if you think about Public Ethereum where balances and amounts are you know globally visible clearly from an enterprise perspective This is not really something that's going to fly and so with the ZSL implementation What we have is a full obfuscation and shielding of balances of positions of Transaction amounts and also of who is actually taking part in the transaction in the first place And so this combination of constellation and ZSL gives us this really nice hybrid hybrid Privacy environment within the Corum network But of course privacy is not the only thing that enterprises need they have high Performance requirements very often given the high volumes that need to be processed and as a result the high throughput And they also need to make sure that those transactions are not only processed quickly, but also definitively So once a transaction is actually Written, you know, they don't want to have it reversed such that the transaction all of a sudden didn't take place And it's only going to be included in the chain in a later point And finally they need to know who they're actually transacting with you know We can't have this in an enterprise environment the pseudonymous or anonymous Participation network and so the way that Corum solves for these things is on the performance side You know Corum is pretty quick. We have blocks that are created every 50 milliseconds Transaction throughput around a thousand transactions per second for simple value transfers and we ensure that transaction Transactions are finalized immediately. So the consensus mechanisms that we use I don't actually allow for fork So you have a guarantee that once your transaction has been committed to the chain It's not going to be reversed and then from a permissioning perspective We have a strong protocol that ensures that you have to be authenticated and authorized onto the network And if you are not then basically you cannot actually communicate with any other node And it's probably a good time to actually talk about Permissioned blockchains in general, you know the question always comes up. Why do you need a permissioned blockchain? Why not just use a regular centralized database or distributed database when you start to look at the properties of traditional distributed database technology and you have you know, there's trust among nodes this closed network you have Strong consistency this starts to sound very much like the things that we need from an enterprise perspective You know all the the requirements that we've just kind of gone through. So why would we consider? You know this public blockchain or this blockchain implementation where you have only eventual consistency You don't know who's on the network. You don't have the high throughput environment and really the answer Comes down to the fact that even in this permissioned environment in this closed network. We still only have partial trust We don't have this unconditional trust amongst network Participants and so actually from a permissioned network perspective and from a quorum perspective We kind of land somewhere in the middle and we end up taking you know, the best of both worlds from from both the Distributed database technology environment as well as the the public blockchain space. So we have guarantees around immutability We have guarantees around auditability and we have the ability to have multiple Writers right to the to the chain without having to cede control to some central party to manage conflict resolution For example, but the question of course is well, what do you do from a consensus perspective? In a permissioned environment, we don't need proof of work. We don't need proof of stake You know, we don't have the same incentive incentivization model that you have in public Ethereum So what we can do is start to implement some some different and quicker consensus mechanisms to date We've had to in a quorum. We have a configurable consensus environment on the one hand We have quorum chain, which is a smart contract based Protocol that has voters and block makers kind of akin to proof of authority Which is something we're going to be looking to implement and then we have raft on the other hand on the other hand Which is obviously a formally proven protocol It is actually based on the core OS etzied implementation Which is using things like Kubernetes and cloud foundry and this is the consensus mechanism That gives us a lot of the the properties that we've already spoken about but neither of them are Byzantine fault tolerant and so when we heard that a me had written a Byzantine fault tolerant consensus mechanism Targeted at geth. We got very excited and quickly started collaborating with them to have have their consensus mechanism implemented Within quorum and so with that let me hand over to you to who can tell you a little bit more about a me and also Istanbul Good morning everyone. My name is Utiline from a me To get started. I would like to quickly introduce a me and what we are doing there I mean, it's a blockchain service company based in Taiwan We provide blockchain services include blockchain infrastructure blockchain applications and blockchain research our most well-known projects are Istanbul BFT Which are we are presenting today and the decentralized ledger for cross-bank transactions in Taiwan While doing this project without current POW design doesn't quite meet our need and that's why we implemented Istanbul BFT Istanbul BFT or IBFT was inspired by Castro Lisco's practical Byzantine fault tolerance paper published in 1999 Without blockchain nice implementation. It has the following key features First of all blocks in IBFT are final Which means no fork is possible and no compromises are necessary anymore In terms of governance it has a manageable very data set So that the data is can add or remove other data is dynamically by voting Unperformance it can process around 800 transactions per second at the same time. He has the same no scalability as each dash does and In order to put in order to make blocks self-verifiable when put consensus proof into block headers Which also means Implementing like client will be quite simple. That's but not least IBFT implemented gossip network So strong connection are not required to make the consensus work IBFT is a three-phase state machine replication algorithm here I like to use a simple network setup to demonstrate how IBFT works Say there are four way data is in this network In the first step or pre-prepared step one of the Vedators will be selected as the proposer Who is in charge of proposed a new block proposal? The Vedators can't accept that to ignore that or start a wrong change Say they all accept that then they will broadcast prepare messages to other Vedators When they receive more than two-third of prepare messages and agree on committing the block into blockchain They they will broadcast coming messages to other Vedators Finally when they receive more than two-third of coming messages They can install the block into blockchain and broadcast the block to other nodes and this concludes consensus wrong So in the next round the next proposal will be selected and propose the next block IBFT can take up to one-third of 40 nodes Here I like to use a simple example to demonstrate how the network react to malicious behaviors Say there is a dishonest Proposer who always propose invalid block The network will detect that and start a wrong change process The wrong change process is trying to find out who becomes the next proposal Once this is decided The next proposal will propose a new block and the block generation consensus will continue IBFT can explicitly detect couple of malicious behaviors To name a few they are store Vedators makes message codes Forge signatures proposal disguise round-change spamming and invalid block proposal All right back to corner a little bit. Why the army pick Warren? There are a couple of reasons first of all Warren is compatible with and close to public Ethereum actually, we have implemented our IBFT on top of pluggable consensus engine So we have used the same code base send a poor request to public go Ethereum Please check our EIP 6 5 0 again EIP 6 5 0 for more detail Also current and I mean are trying to solve the same problem Not only for banking systems, but also under regulatory environments current has supported three Consensus options, which are really useful in these cases They are current trend revved and now IBFT as well That's but not least With JP Morgan backing Corrin it builds up trust while working for banking systems All right, we have escaped a lot of technical details if you are interested in learning more Please come to us our team is here and we are wearing army t-shirts. Thank you So, yeah Istanbul now is available in Corrin, which we are extremely excited about it gives us that all important Byzantine fall tolerant Consensus mechanism has really been on the road map since day one, but I think the story is much bigger than just Consensus here. So if we look at what's happened in quorum over the last year, we really have this Nice collaborative environment that is has taken place. So the the Istanbul implementation is actually resulted in I mean submitting a PR back to get to improve the pluggable consensus interface and We've also partnered obviously as I said with z-cache for the first full zero-knowledge proofs implementation in an ethereum client and what this really gives is a really nice reference implementation for Zero-knowledge proofs going forward within within public ethereum We've also collaborated with block apps who developed a tool called eth pruna Which allows us to archive or historical state which obviously reduces blockchain bloat Improves the performance of the of the network and as the name says eth pruna This is not just something that's targeted at quorum But also something as targeted and used unusable for the actual main line ethereum code base Excuse me and then finally with co-made technologies who developed porosity, which is an EVM decompiler Decompiling bytecoded into solidity contracts that helps from a quorum perspective to identify Vulnerabilities in smart contracts and of course given that quorum and ethereum are very close together It's directly usable within public ethereum, too. So I think what you have is this in a really nice two-way Movement of innovation between the public ethereum space and also from the permission permission environment back to public ethereum and when you couple that with The number of companies that are now looking at quorum building on top of quorum building projects on quorum Building tools around quorum. This is all directly relevant and useful to public ethereum as well So we have an increase in focus on ethereum We have an increase in acceptability within enterprise of ethereum and ultimately I think in terms of what we're collectively trying to do That can only be a good thing. So that's it. That's our talk today. Thank you so much for listening If you want to have more information