As world leaders, chief executives and bankers converge on the Swiss Alpine resort of Davos for the WEF's annual meeting, there are growing threats about the rise of populism, from Donald Trump's election as the next president of the United States to Britain's decision to leave the European Union.
While President-elect Trump campaigned on scrapping and renegotiating trade deals, there are concerns about the future of the post-war democratic order. And with more elections across Europe this year, Schwab says leaders need to listen to their people.
"You have to have your ear on the ground," Schwab said, adding you need to"address the root cause of problems that people have."
He went on to argue that globalization is not to blame for the rise in populism and it was in fact, the rise of technology.
"The key challenge is not so much globalization. It is actually, what I call the fourth industrial revolution. Because its technology which creates the major changes in our daily lives. It's technology that creates the fears. What we want to do is make the world much more aware. On the one hand of the opportunity of the new technology but on the other hand the risks and dangers we encounter."
Countering criticism that the WEF, and many of its wealthy participants, are out of touch with the vast majority of the people, Schwab pointed to an article he wrote for the New York Times in 1996, in which he warned about threats to the world order from global trade.
"Economic development has to be coupled with social responsibility," he said.
"Now we are maybe more aware this year about the need of coupling these two than ever before.
"We are living in a time of a lot of turmoil. We have many question marks related to the future. But that is exactly why people … we have a record participation come here to listen to each other, to have a dialogue, and to make sense out of what is happening. And I hope they will respond and they have to respond."
Schwab went on push back against the stereotype of the people who come to the annual meeting, often referred to as "Davos Man."
"I hate, let's say this cliché because there is not one Davos man or not one Davos woman," he told CNBC.
"Hopefully, there will be many more Davos women. There are 3,000, everybody has their own identity and so on. It is the whole essence of Davos that is to have different cultures, different backgrounds, different constituency – coming together and sharing one common objective. And the common objective, in the end, is to make this world a better place."