Gerrard was announced as the skipper for next month’s tournament during the newly-appointed manager’s squad announcement last Wednesday.
And the former Inter and Barcelona midfielder now believes that Gerrard will be key to any success England achieve.
Speaking to the Daily Mirror Davids said: “The important thing for me is that Hodgson has named Gerrard as the new captain. I think Gerrard is amazing and can do a great job.
“True, he has not always played as well for his country as for his club, but I think you have to play to his strengths and build the whole team around him. He can drive the England team like no other player.
“Gerrard is passionate and he leads from the front. At times he has lifted Liverpool to great wins almost single-handedly.
“People say he can’t play with Frank Lampard but that’s nonsense. Great players will always be able to play with other great players. It’s up to Hodgson to fix it.”
Davids believes that with the usual high expectations surrounds the national side seemingly subsided, following the long period of uncertainty leading up to the tournament, and the lessened pressure will aid the players.
“The great thing for them is that they are going into the tournament with low expectations,” he added.
“That means far less pressure than normal. So with the pressure off, they could do a lot better than their fans – and the media – are actually expecting.”
But, despite Davids’ belief that Hodgson’s charges will have a good tournament; he still backs his own country to be a success in Poland and the Ukraine.
The Netherlands lost out to Spain in the final of World Cup 2010, and he is backing his countrymen to go one better this time round.
“I actually think we will win it this time around, technically the Dutch are looking really great and have been growing as a team for some time,” he added.