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2025 Trends

As Trump looms large over Davos, executives keep calm and carry on

Published 24 January 2025 in 2025 Trends • 13 min read

Business leaders at this year’s World Economic Forum sought to block out the political noise and focus on what’s happening in the real economy.

Global leaders descended on Davos for the 55th annual World Economic Forum (WEF) meeting to gauge the mood and tap into the trends driving business in 2025. Convening under the theme of “Collaboration for an Intelligent Age”, the discussions centered on how to join forces to accelerate the energy transition, deploy AI for the benefit of all, and increase global cooperation to promote public health, economic prosperity, and international security.

Many of the conversations in the Swiss town this year have been shaped by events on the other side of the Atlantic, where US President Donald Trump returned to office for a second term. In the administration’s first few days, he threatened tariffs, rolled back green policies, and vowed to disengage from the world.

While the slew of Trump’s “America-first” announcements dominated the discourse at the WEF, there was also a desire among many executives to block out the political noise and focus on advancing goals and solving challenges. “If we are hyperventilating over what is happening, we lose focus,” said Director-General of the World Trade Organization Ngozi Okonjo-Iweala, who will be a keynote speaker at IMD’s Orchestrating Winning Performance program in June. “I’m not going to stop, and neither should you.”

Here are eight takeaways from IMD faculty and experts:

One hypothesis I carry with me is that when it comes to sustainability, we may see less talk and more action, especially from US firms.

Global leaders balance Trump’s return with focus on ongoing challenges

David Bach, IMD President and Nestlé Professor of Strategy and Political Economy

This was my first annual meeting in Davos, and I understand why it has become a must-do for so many leaders. The ability to huddle, formally or informally, with CEOs, governmental officials, non-profit leaders, academics, and media representatives from around the world is unique. That is why I am so excited that 12 different IMD faculty and thought leaders got to share their expertise at Davos, thus delivering on our mantra to “impact the impactful”.

My biggest takeaway is that global leaders seem to be able to compartmentalize – 20% of their attention was squarely focused on Trump’s return to the White House, while 80% remained dedicated to solving global challenges, from bolstering economic growth to advancing the energy transition to adapting to a world of ubiquitous and ever-more powerful AI. It’s not like these two domains were entirely separate – of course, there was discussion on Trump’s impact on global trade, regional conflicts, or energy markets – but leaders weren’t ready to jettison their joint efforts just because of the new occupant in the White House. That’s important. 

One hypothesis I carry with me is that when it comes to sustainability, we may see less talk and more action, especially from US firms. In the previous environment, CEOs faced incentives to make bold climate or DEI commitments. Doing so now is much riskier. That means the focus ought to return to the business case for promoting affordable, clean energy and more diverse and inclusive teams and organizations. I’ll be following developments closely to see whether my optimism is justified. 

IMD President David Bach (left) speaks at a World Economic Forum panel event
Many Davos attendees carefully parsed the President's speech, Executive Orders, and press conferences.

Trump generates ‘political fog’ at Davos

Simon Evenett, Professor of Geopolitics and Strategy

Perhaps it was inevitable that, at a Davos where Trump’s Inaugural speech “landed” before Monday’s welcome reception, his remote presentation on Thursday bookended the week. Rather than take the opportunity to lay out the terms upon which he wants to engage with the rest of the world, the President, in his address, repeated his domestic and international grievances. He broke new ground by adding OPEC nations to the governments already on the “naughty step”. The address confirmed the impression that David Bach, Richard Baldwin, and I have that the new U.S. president deliberately generates political fog in the hope of wrongfooting his counterparts. 

Many Davos attendees carefully parsed the President’s speech, Executive Orders, and press conferences. The reaction of many non-American executives, officials, and analysts was to remain calm and attentive but not dismissive. In a world economy with multiple growth poles, the reality is that the US economy is not the only commercial game in town. 

If there was gloom at this year’s Davos, it was over European competitiveness – but even there, optimists referred to “peak pessimism”. I wasn’t sure if the widely reported, apparently largely unspoken, optimism of US executives about Trump’s deregulation and tax plans was not, in fact, relief that the legal onslaught from Joe Biden’s regulators was over. We may have underestimated how many US executives were torn between the last President’s social and economic agendas. 

As AI becomes increasingly opaque, companies must be mindful of the growing cybersecurity risks, such as “data poisoning”, where bad actors hack into your data to nudge the AI in a certain direction.
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Executives play up the promise of AI and discuss scaling but pay less attention to risk implications

– Öykü Işık, Professor of Digital Strategy and Cybersecurity

Artificial intelligence remained one of the headline themes, with business leaders talking up the technology and acknowledging that it is becoming a strategic priority for many organizations, although maturity and adoption across sectors vary. Panels were devoted to the broader workforce implications, governance, and the demands the technology’s voracious energy appetite will place on infrastructure.

Awareness is undoubtedly growing on the need for vast investments in data and energy infrastructure, as well as chip technology, to power this technology over the coming decades, especially as we move towards agentic AI, where independent, autonomous agents are capable of independently performing tasks. However, solutions for addressing some of the issues, such as energy consumption and responsible AI, remained thin on the ground.

As AI becomes increasingly opaque, companies must be mindful of the growing cybersecurity risks, such as “data poisoning”, where bad actors hack into your data to nudge the AI in a certain direction.

The impact of AI on skill development was also a theme, with panels devoted to how to thrive in the age of AI and the need to redefine metrics to measure softer skills like empathy, adaptability, and resilience.

Öykü Işık (second from right), IMD Professor of Digital Strategy and Cybersecurity, at a panel event in Davos
As digital transformation accelerates, we're witnessing a layered accumulation of systems built upon systems.

A ‘spaghetti of systems’ is complicating cybersecurity

– Öykü Işık, Professor of Digital Strategy and Cybersecurity

While many cybersecurity trends highlighted in the WEF’s 2025 Global Cybersecurity Report aren’t new, what struck me following closed-door discussions at Davos is that many organizations are grappling with increasing complexity in the cybersecurity landscape.

As digital transformation accelerates, we’re witnessing a layered accumulation of systems built upon systems. This intricate web – a “spaghetti of systems” – makes it increasingly difficult to identify vulnerable attack points or trace the source and path of security breaches.

The challenge intensifies with growing ecosystem complexity as companies forge more partnerships and integrate into platforms. Recent breaches demonstrate how threat actors exploit these interconnections to cascade through organizations. The 2020 SolarWinds hack is a stark example: a breach in cloud-based services triggered thousands of secondary breaches across connected organizations, including Fortune 500 firms and US government agencies.

 Against this backdrop, here are two critical steps to build organizational resilience in 2025:

  1. Prioritize critical supplier security: In today’s sophisticated threat landscape, organizations must strategically identify and secure their most vital supply chain partners. This targeted approach ensures resources are invested where they matter most.
  2. Create a repository of real-world incidents: Too many companies still try to cover up cyber breaches. Yet, we typically gain more valuable insights from what went wrong than from best-practice examples, which often aren’t universally applicable. To advance our cybersecurity knowledge, we need an open and transparent repository of breach case studies detailing root causes and failure points. A good example is the British Library, which opted for a policy of full transparency following a major Ransomware attack.

We still need the EU but we must get capital flowing better to boost Europe’s competitiveness

Arturo Bris, Professor of Finance and Director of the IMD World Competitiveness Center

Ironically, one overriding message of the panels I attended in Davos this year was: “We need more action and less talk.” Overall, there was too much talking about sustainability and too little recognition of the fundamental changes we have seen in 2024. We lack the economic models, tools, and knowledge to help corporate and political leaders design a new economic system where social and economic objectives might all be fulfilled. In today’s world of trade-offs, feeding our children and guaranteeing our pensions remains the priority, so economic objectives do, fortunately, continue to take priority. This is a system that we know works, and according to it, sustainability is merely another term for “long-term investment”.

Here are my key takeaways from the discussions I had on competitiveness:

  • Despite the established opinion, Europe is the most advanced region in the world in several key fields of innovation, including biotech. Biotech is also an industry that helps keep up the belief in the single market: approvals do get through, but the process (which can take years) is too long.
  • European productivity metrics hide the fact that Europe is more prosperous and enjoys a better quality of life and work than the US and China. However, there is too much regulation in Europe. Less regulation will help boost competitiveness.
  • We need a new regulatory environment and clear agility incentives in Europe. It is ultimately about competitiveness, and that needs to be created from the right frameworks.
  • Europe’s problem is one of capital markets not capital: they are too small. More venture capital money comes from Europe than the US, but most of it gets sent to the US. Then, with that money (e.g., my pension fund), they buy our companies (e.g., Microsoft buying Skype).
  • European leaders (both political and corporate) need to take action to develop capital markets so that they are big enough for Europe to import investment flows and stop exporting them.
  • Clean fuel is a huge industry opportunity for Europe that is passing us by. If shipping were a country, it would be the fifth largest polluter in the world, but with no president of the sea, it is not well controlled. Europe’s shipping lines have done what they need to, but there’s a price gap that needs addressing so that the production of better fuel can take off, for instance, with the building of hydrogen plants. Nothing is being done in the EU. Here, we need a clear rhetoric: if you don’t save on clean fuel, you will pay a fine.
  • The EU Commission has the right ideas but not enough money (they couldn’t even raise a defense bond for the Ukraine war). Too much of their purpose revolves around being re-elected as EU ministers; telling their country it needs to send more money to the EU doesn’t tend to go in their favor.
IKEA CEO Jesper Brodin said climate smart was resources smart and business smart – a view echoed by many other CEOs in the corridors of this year’s WEF.

Sustainability momentum has left the station

Julia Binder, Professor of Sustainable Innovation and Business Transformation, Knut Haanaes, Professor of Strategy and Lundin Chair Professor of Sustainability, and Natalia Olynec, IMD Chief Sustainability Officer

Despite strong political headwinds from across the Atlantic, there was broad consensus among executives and leaders in Davos that the sustainability train has left the station and cannot be stopped.

On the opening night, Al Gore, the former US Vice President and maker of the documentary, The Inconvenient Truth, gave a stirring speech, urging the audience not to despair and reminding us that the science and the economics of sustainability will compel us to accelerate our efforts on the energy transition regardless of policy changes in Washington. Some 87% of new electricity generation installed globally was renewables, he noted. Emmanuel Faber, Chair of the International Sustainability Standard Board (ISSB), shared how 30 countries (representing two-thirds of GDP) have already adopted the new sustainability standards, marking an important step forward for a shared language and global accountability for sustainability disclosure.

IKEA CEO Jesper Brodin said climate smart was resources smart and business smart – a view echoed by many other CEOs in the corridors of this year’s WEF. As one executive put it, we need to keep calm and carry on.

Panel discussions on moving beyond GDP as a measure of prosperity underscored the power of business, government, civil society, and academia coming together.

As the saying by management guru Peter Drucker goes: “What gets measured gets done.” There was a strong desire among participants in sessions at the SDG Tent to redefine value to account for the positive and negative impacts of our actions. New measures should be made simple enough that all companies will want to participate, with a particular focus on SMEs. Building on existing frameworks was also seen as more desirable than reinventing the wheel because we are running short of time, and inaction is costly.

“The antidote to climate despair is action,” said Al Gore. We leave Davos inspired by a movement that is going in the right direction and energized to put forward positive narratives toward our collective, sustainable future.

Special Address of the United States of America session, Davos 2025
Perhaps inevitably, given the DEI backlash, the topic of inclusion was pushed down the WEF agenda this year.

AI will create an opportunity for women leaders to lean in more

Sophie Bacq, Professor of Social Entrepreneurship and Coca-Cola Foundation Chair in Sustainable Development, and Jennifer Jordan, Professor of Leadership and Organizational Behavior

Perhaps inevitably, given the DEI backlash, the topic of inclusion was pushed down the WEF agenda this year. However, in many side events, there was hope and optimism that DEI would remain an important part of doing good business and attracting talent. “Unless you have visible female leadership in a company, it’s quite difficult to attract women into that company,” Katie Jackson, CEO of Rio Tinto Copper, told the World Woman Davos Agenda. Ngozi Okonjo-Iweala also gave us a timely reminder to remain hopeful for the future and resist a state of panic since that would not put her in the right mindset for critical problem-solving. 

In the Female Quotient’s Equality Lounge, it was noted that the rise of AI, which replaces many technical skills, will lead to higher demand for “durable skills” (not soft skills!) such as empathy, resiliency, and caring – more traditionally associated with women’s leadership. There was hope, too, that AI would make humans more deeply human – freeing up time and space for us to reflect, ask critical questions, and innovate more.

The most transformative discussions on inclusion occurred beyond the main congress hall, particularly in dedicated spaces like the World Woman Davos Agenda and The Female Quotient Equality Lounge.

DEI conversation evolves to how to measure impact

Sarah Toms, IMD Chief Innovation Officer

The most transformative discussions on inclusion occurred beyond the main congress hall, particularly in dedicated spaces like the World Woman Davos Agenda and The Female Quotient Equality Lounge. While DEI remains fundamental to business strategy, despite pushback in some quarters, the conversation has evolved toward measurable impact.

Our IMD, Microsoft, and EqualVoice whitepaper revealed a critical gap: only 5% of leaders can confidently identify AI bias. This underscores the importance of having a responsible AI agenda that, as Dr Annabella Bassler of Ringier and EqualVoice, explained moves “from garbage in, garbage out” to “diversity in, progress out”.

The Female Quotient panel I moderated surfaced innovative approaches to measuring leadership effectiveness. ETS research highlighted women’s demand for certification of traditionally unmeasured skills, while EY’s Vitality Index pioneers team wellness metrics. WorkHuman’s insights reinforced that psychological safety directly correlates with team performance and productivity.

Authors

David Bach

David Bach

President of IMD and Nestlé Professor of Strategy and Political Economy

David Bach is President of IMD and Nestlé Professor of Strategy and Political Economy. He assumed the Presidency of IMD on 1 September 2024. He is working to broaden and deepen IMD’s global impact through learning innovation, excellence in degree- and executive programs, and applied thought leadership. Recognized globally as an innovator in management education, Bach previously served as IMD’s Dean of Innovation and Programs.

Simon Evenett

Simon J. Evenett

Professor of Geopolitics and Strategy at IMD

Simon J. Evenett is Professor of Geopolitics and Strategy at IMD and a leading expert on trade, investment, and global business dynamics. With nearly 30 years of experience, he has advised executives and guided students in navigating significant shifts in the global economy. In 2023, he was appointed Co-Chair of the World Economic Forum’s Global Future Council on Trade and Investment.

Evenett founded the St Gallen Endowment for Prosperity Through Trade, which oversees key initiatives like the Global Trade Alert and Digital Policy Alert. His research focuses on trade policy, geopolitical rivalry, and industrial policy, with over 250 publications. He has held academic positions at the University of St. Gallen, Oxford University, and Johns Hopkins University.

Oyku Isik IMD

Öykü Işık

Professor of Digital Strategy and Cybersecurity at IMD

Öykü Işık is Professor of Digital Strategy and Cybersecurity at IMD, where she leads the Cybersecurity Risk and Strategy program and co-directs the Generative AI for Business Sprint. She is an expert on digital resilience and the ways in which disruptive technologies challenge our society and organizations. Named on the Thinkers50 Radar 2022 list of up-and-coming global thought leaders, she helps businesses to tackle cybersecurity, data privacy, and digital ethics challenges, and enables CEOs and other executives to understand these issues.

Arturo Bris

Arturo Bris

Professor of Finance at IMD

Arturo Bris is Professor of Finance at IMD. Since January 2014, he has led the world-renowned IMD World Competitiveness Center. At IMD, Bris directs the Boards and Risks program and Blockchain and the Future of Finance program. He also previously directed the flagship Advanced Strategic Management program between 2009 and 2013.

Julia Binder

Julia Binder

Professor of Sustainable innovation and Business Transformation at IMD

Julia Binder, Professor of Sustainable Innovation and Business Transformation, is a renowned thought leader recognized on the 2022 Thinkers50 Radar list for her work at the intersection of sustainability and innovation. As Director of IMD’s Center for Sustainable and Inclusive Business, Binder is dedicated to leveraging IMD’s diverse expertise on sustainability topics to guide business leaders in discovering innovative solutions to contemporary challenges. At IMD, Binder serves as Program Director for Creating Value in the Circular Economy and teaches in key open programs including the Advanced Management Program (AMP), Transition to Business Leadership (TBL), TransformTech (TT), and Leading Sustainable Business Transformation (LSBT). She is involved in the school’s EMBA and MBA programs, and contributes to IMD’s custom programs, crafting transformative learning journeys for clients globally.

Knut Haanaes

Knut Haanaes

Lundin Chair Professor of Sustainability at IMD

Knut Haanaes is a former Dean of the Global Leadership Institute at the World Economic Forum. He was previously a Senior Partner at the Boston Consulting Group and founded their first sustainability practice. At IMD he teaches in many of the key programs, including the MBA, and is Co-Director of the Leading Sustainable Business Transformation program (LSBT) and the Driving Sustainability from the Boardroom (DSB) program. His research interests are related to strategy, digital transformation, and sustainability.

Sophie Bacq OWP

Sophie Bacq

Professor of Social Entrepreneurship and Coca-Cola Foundation Chair in Sustainable Development, IMD

Sophie Bacq is Professor of Social Entrepreneurship and Coca-Cola Foundation Chair in Sustainable Development at IMD. As a globally recognized thought leader on social entrepreneurship and change, she investigates and theorizes about entrepreneurial action to solve intractable social and environmental problems, at the individual, organizational, and civic levels of analysis. At IMD, she leads the Social Entrepreneurship Initiative, which aims to inspire entrepreneurs, leaders, scholars, and organizations to change the system and to create and share new solutions for positive societal change.

Jennifer Jordan

Jennifer Jordan

Social psychologist and Professor of Leadership and Organizational Behaviour at IMD

Jennifer Jordan is a social psychologist and Professor of Leadership and Organizational Behavior at IMD. Jennifer’s teaching, research, and consulting focus on the areas of digital leadership, ethics, influence, and power. She has received specialized training and certifications in lie and truthfulness detection, as well as in conflict resolution within organizations. She is Program Director of the Women on Boards and the Leadership Essentials program, and co-Director of the Leading Digital Execution program.

Sarah Toms

Sarah E. Toms

Chief Innovation Officer

Sarah Toms is Chief Innovation Officer at IMD. She leads information technology, learning innovation, Strategic Talent Solutions, and the AI Strategy. A demonstrated thought leader in education innovation, Sarah is passionate about amplifying IMD’s mission to drive positive impact for individuals, organizations, and society.

She previously co-founded Wharton Interactive, an initiative at the Wharton School that has scaled globally. Sarah has been on the Executive Committee of Reimagine Education for almost a decade, and was one of the ten globally to be selected as an AWS Education Champion. Her other great passion is supporting organizations who work to attract and promote women and girls into STEM.

She has spent nearly three decades working at the bleeding edge of technology, and was an entrepreneur for over a decade, founding companies that built global CRM, product development, productivity management, and financial systems. Sarah is also coauthor of The Customer Centricity Playbook, the Digital Book Awards 2019 Best Business Book.

Natalia Olynec, Head of Sustainability at IMD

Natalia Olynec

Chief Sustainability Officer at IMD

Natalia is the Chief Sustainability Officer at IMD. She designs and implements sustainability strategy, develops executive education programs and advisory, publishes research, builds cross-sector partnerships, and communicates IMD’s ambitions and progress. The Center for Sustainable and Inclusive Business, co-led by Olynec, aims to support leaders and companies to take steps towards a more sustainable and inclusive business world by harnessing IMD’s knowledge and expertise in this field and offering tools to help them deliver systemic, innovative, and impactful responses.

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