Development challenges cannot be met without public-private partnership, according to CEO survey

18 January 2005 - Geneva, Switzerland

Nine out of ten surveyed CEOs feel that partnerships between business, government and civil society must play either a major role or some role in addressing key development challenges facing the world today. This is one of the key findings of a report released by the World Economic Forum’s Global Corporate Citizenship Initiative (GCCI). The report entitled “Partnering for Success: Business Perspectives on Multistakeholder Partnerships” assesses the current experience of the international business community with multistakeholder partnerships.

Partnering for Success: Business Perspectives on Multistakeholder Partnershipsis the fourth annual report of the Global Corporate Citizenship Initiative, produced in collaboration with The Prince of Wales International Business Leader’s Forum (IBLF) the Kennedy School of Government, Harvard University. Based on surveys conducted with the GCCI’s over 40 member companies, the report focuses on the innovative approaches that the GCCI member companies are taking to build partnerships with other private enterprises, government bodies and civil society organizations to address key international development challenges, and to do so in a manner that makes sound business sense and does not replace or undermine the role of government.

“Many public-private partnerships are new and untested and some of them are likely to fail. Yet, these partnerships offer an important new approach that has the potential to drive innovation, improve governance, raise living standards and provide opportunity to millions of people. They deserve continued support, engagement and evaluation from business leaders.” says Richard Samans, Managing Director of the World Economic Forum’s Global Institute for Partnership and Governance.

The World Economic Forum report describes 15 concrete and practical ways for companies to engage in partnerships for development. All of them are based on existing partnership examples that GCCI member companies actively join in or support. Between them, these alliances have engaged thousands of different partners around the world and leveraged millions of dollars in cash and in-kind resources.

“The report reviews the thoughts of a group of leading companies who are already committed to being good corporate citizens. Their views reflect a growing consensus amongst business and development circles of the importance of new types of non-traditional alliances and funding mechanisms,” says Jane Nelson, Director of the Corporate Social Responsibility Initiative at the Kennedy School of Government, Harvard University and a Director of the International Business Leaders Forum. And she continues: “Partnership is critical to effective problem solving of the challenges facing business and the developing world. Simply put, the issues are too complex and interdependent, and the resources and legitimacy for tackling them too dispersed between sectors, for any one group to have all the solutions alone.”

The two most common reasons that respondents gave for engaging in such partnerships were committing to the company’s own values, principles, policies and traditions and protecting corporate reputation and brand. Meeting project financing, investor and other funding requirements, investing in a sound and secure operating environment and entering into untapped or underdeveloped markets were also listed as key reasons.

The CEOs who support the Global Corporate Citizenship Initiative emphasize that the most important contribution they can make to development is in the way they run their own businesses. They also recognize, however, that engaging with stakeholders inside and outside their companies can help to leverage the resources, skills, competencies, technology and networks of these business operations, thereby increasing the contribution that business can make to development.

The partnership examples identified by the GCCI companies include collective efforts to address systemic challenges. Examples are improving the quality of public education, reforming healthcare delivery, strengthening the financial sector, building mechanisms to tackle corruption and supporting specific projects. Examples of these include the training of Venezuelan judges on human rights issues; logistics support for disaster relief in Morocco; provision of credit and mentoring to small-scale enterprises and youth entrepreneurs in India, South Africa and the Middle East; supply of clean energy to rural communities in Madagascar; e-learning in Pakistan, the Philippines and Malaysia; technical assistance for small-scale farmers in Kenya; and efforts to tackle malaria and HIV/AIDS throughout Africa. All of these examples shed light on one of the key leadership challenges of our time: How to find new ways to harness the innovation, technology, networks and problem-solving skills of the private sector, in partnership with others, to spread the benefits of development more widely.

In the context of the survey, companies were also asked to rank the three most important and consistent development challenges they face in the developing countries in which they operate. The ranking is as follows:
1. Promoting good governance and tackling corruption
2. Alleviating poverty
3. Achieving sustained economic growth and education
4. Sustaining peace and security
5. Eliminating HIV/AIDS
6. Securing access to energy and water.

Nearly all the respondent companies listed China as the most important emerging market. The other emerging markets most highly ranked were India, Brazil, Russia, Southern Africa, South-East Asia and the Middle East. The rapid economic development and growing geopolitical significance of these markets offer enormous long-term business potential, but pose a variety of leadership challenges and risks for most private enterprises. These include the challenges of dealing with fundamental economic restructuring and uncertainty, political transition, evolving governance structures, poor working conditions, human rights concerns, environmental stress and high levels of inequality. All of these have important implications for business success and survival, but none of them are issues that the private sector can address alone.

Partnering for Success: Business Perspectives on Multistakeholder Partnerships is produced in collaboration with The Prince of Wales International Business Leaders Forum and the Corporate Social Responsibility Initiative at the Kennedy School of Government, Harvard University. Some of the findings of the survey are supported by research conducted by SAM Sustainable Asset Management, which covers over 1,300 companies.

For further information on the Global Corporate Citizenship Initiative and the reportPartnering for Success, please contact Stefanie Held, Senior Project Manager GCCI, at stefanie.held@weforum.org or Valerie Weinzierl, Project Manager GCCI, at valerie.weinzierl@weforum.org.

Background Information on the Global Corporate Citizenship Initiative (GCCI)
Launched in July 2001, the World Economic Forum's Global Corporate Citizenship Initiative (GCCI) has the objective of increasing business engagement in corporate citizenship as an element of business strategy. With over 40 company members representing a variety of regions and sectors, the Initiative concentrates on defining and facilitating the leadership role of CEOs and boards in integrating into business practice policies that respond to the evolving expectations of society regarding the responsibilities of companies in a global economy. Using the Forum's Annual, Regional, and Governor meetings as platforms, Initiative members exert thought leadership and expand the market for enlightened corporate citizenship in cooperation with experts and other organizations around the globe that specialize in corporate responsibility. For further information, please go to http://www.weforum.org/corporatecitizenship

Background Information on the The Prince of Wales International Business Leaders Forum (IBLF)
The Prince of Wales International Business Leaders Forum (IBLF) was formed to promote responsible business practices internationally that benefit business and society, and which help to achieve social, economic and environmentally sustainable development, particularly in new and emerging market economies. The IBLF focuses on building partnerships as a more effective and legitimate approach to engaging business in development. It has built close and longstanding working relationships with its member companies, and with a broad range of national and international agencies, NGOs, business associations and media around the world and has a current membership at CEO level or above from more than 65 of the world’s leading multinational companies. For more information see www.iblf.org


Background Information on The Corporate Social Responsibility Initiative at the Kennedy School of Government, Harvard University
The Corporate Social Responsibility Initiative at the Kennedy School of Government, Harvard University is a multi-disciplinary program that undertakes research, education and outreach activities, to study and enhance the public role of private enterprise and develop the next generation of leaders. It focuses on exploring the intersection between corporate responsibility, corporate governance and strategy, public policy, and the media. The initiative is a cooperative effort between the Kennedy School’s Center for Business and Government, Center for Public Leadership, Hauser Center for Non-Profit Organizations, and Joan Shorenstein Center on the Press, Politics and Public Policy. For more information see www.ksg.harvard.edu/cbg/CSRI