The World Economic Forum (WEF) has launched a formal investigation into its founder and longtime executive chair, Klaus Schwab, following a series of explosive allegations of financial and ethical misconduct, prompting the 87-year-old to step down immediately.
The move comes after a whistleblower letter — reportedly sent to the WEF last week — accused Schwab and his wife, Hilde Schwab, of misusing organization funds, manipulating internal reports, and pressuring junior staff into personal errands involving thousands of dollars in cash withdrawals.
Key Allegations:
- WEF funds allegedly used to pay for Schwab’s private massages at hotels
- Schwab reportedly pushed staff to lobby for a Nobel Peace Prize nomination
- Accused of manipulating WEF’s global competitiveness report to curry favor with governments
- Allegedly directed junior employees to withdraw large sums from ATMs on his behalf
- Hilde Schwab reportedly arranged “token” meetings to justify luxury travel using WEF funds
- Schwab family allegedly maintained private control over Villa Mundi, a WEF-owned luxury property on Lake Geneva
The Schwabs have denied all accusations, calling the claims unsubstantiated and vowing legal action. A statement released to some outlets accused unnamed actors of “character assassination.”
The WEF board — which includes global power figures like Larry Fink (BlackRock), Kristalina Georgieva (IMF), Al Gore, and cellist Yo-Yo Ma — held an emergency meeting on Sunday and decided to move forward with an internal probe. Schwab reportedly resisted the investigation before tendering his resignation on Monday.
Though Schwab had previously indicated plans to step down in early April, the allegations accelerated his exit, marking the end of a 54-year tenure.
Interim Leadership
The WEF board has named Peter Brabeck-Letmathe, former Nestlé CEO, as interim chair, while it searches for a permanent successor.
A Legacy in Turmoil
Schwab — often dubbed “Mr. Davos” — founded the WEF in 1971 and turned it into a powerful platform that annually brings together world leaders, CEOs, celebrities, and central bankers in the Swiss resort of Davos. However, recent years have seen growing criticism of his leadership style and WEF’s opaque succession planning.
Notably, a previous internal investigation in 2022 raised red flags about toxic workplace culture and a lack of leadership depth under Schwab, with former employees claiming he had surrounded himself with “nobodies” incapable of running the organization.
As scrutiny mounts, Schwab’s departure may mark a turning point for the WEF, as it seeks to rebuild its reputation and internal structure amid mounting global skepticism over elite-led globalism.
More developments are expected as the investigation unfolds.
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