Why Your Company Needs to Know What ‘PPP’ Stands For

July 21, 2009
  • Chad Bolick

    Former Director, Global Partnership Development, BSR

  • Eva Dienel

    Former Associate Director, Communications, BSR

As BSR President and CEO Aron Cramer pointed out in his article last week, governments around the globe are increasingly involved in corporate responsibility efforts. This week, BSR’s Chad Bolick, Director, Partnership Development, discusses how that trend is playing out for companies—what's working, what's not, and whether public-private partnerships are really the way forward.

Describe this trend. How are companies working with the public sector to implement social and environmental programs?

In the present incarnation of government expansion and private sector contraction, companies are reconsidering partnership with the public sector, including governments and other public institutions like the United States Agency for International Development (USAID), the World Bank, and the World Health Organization. Not only do these institutions bring financial resources and country-level expertise to partnerships, they mitigate risk and bolster credibility at home and in challenging operating environments.

Forming partnerships with government also represents a more proactive and sustainable approach to linking global development priorities to responsible business practices than does, for instance, passive philanthropy. Ideally, a new partnership paradigm will emerge that harmonizes action among governments, companies, NGOs, and foundations. Passive philanthropy, while useful in providing for immediate needs, does not address systemic problems and can even stall progress.

There's a lot of talk about public-private partnerships (PPPs) as the way forward. Is action keeping pace with the talk?

While there are many useful examples of the public and private sectors working together, the current PPP model is relatively new. But it’s evolving rapidly, especially under the Obama administration, which, as Aron alluded to in his article, has placed several innovators into positions of partnership leadership—and that bodes well for change. In the case of the U.S. government, companies are waiting to see if Obama will fundamentally reshape foreign assistance in a way that streamlines bureaucratic processes and institutionalizes a role for the private sector.

On an international level, the Global Development Alliance (GDA), a USAID partnership effort that mobilizes companies, government, and local NGOs to promote international development, is a useful example of a mature partnership vehicle. Other governments, particularly the German and U.K. governments, are also promoting PPPs and actively soliciting company participation. Private foundations—which are familiar partners with government and also work in close proximity with business leaders who funded their endowment—are increasingly including companies in their programs as well.

What are some examples of effective PPPs?

A recent partnership formed by USAID, Western Union, and the Pan-African Bank to launch a program to support diaspora business development in sub-Saharan Africa is a useful example of a more traditional PPP. In addition to benefiting local communities, the partnership also complements Western Union's expertise on labor migrants and core business related to global financial remittances.

A less traditional approach is a recent partnership between the U.S. Department of State and Howcast Media, a U.S.-based company that produces online how-to videos and guides. This partnership, in which Howcast and the State Department brought together partners to brainstorm a manual on affecting social change using online tools, is aimed at forming a global network of youth leaders to catalyze efforts against violence and oppression. Each party benefits from the partnership: Howcast receives enhanced exposure and increased ad sales, while the State Department works toward long-term foreign policy objectives.

When it comes to these partnerships, what’s working, and what's not?

More and more companies are aware of PPPs as an option for enhancing business and development outcomes, particularly in emerging economies and post-conflict environments. While these partnerships historically focused on health and economic development issues, they are increasingly focusing on clean energy and climate change, information and communications technology, and social media. What works well about these partnerships is that the fresh perspective and social entrepreneurship lens the private sector brings to problem-solving nicely complements the local expertise and credibility of governments and NGOs.

While this isn’t an example of what's "not working," per se, I do think there's an opportunity to expand the current parameters of PPPs to link local governments with companies to pool resources and amplify impact. And this is already happening in some cases—such as partnerships that more frequently include foundations in the mix. For example, the Rockefeller Foundation, the United Nations, and Vodafone recently launched a Mobile Health (mHealth) Alliance that will develop scalable, sustainable solutions to healthcare provision via mobile phones in developing countries.

Transformative business and development outcomes are most likely to emerge from organic partnerships between local governments and companies, be they local or multinational. And, as always, a focus on the business case for partnership is more likely to lead to sustainable outcomes.

How has BSR been working to support public-private partnerships?

We also design and implement partnerships for companies, like one recently implemented in India for USAID and Coca-Cola on water management. We also work with the U.S. Department of State and a number of companies, including Gap, Levi Strauss, Nike, and Starbucks, on pilot initiatives in Central America to strengthen regional competitiveness by promoting more responsible labor practices. We also provide guidance to the Global Development Alliance office at USAID on private sector outreach.

For companies that are exploring opportunities for PPPs, what first steps would you recommend?

First, if your company has a government affairs liaison in Washington, Brussels, or beyond, ask them if they have contacts with relevant government agencies involved with creating PPPs. If not, contact BSR, and we will put you in touch with the most relevant contacts in your home country or region.

Second, evaluate any existing partnerships with stakeholders, be they government, NGO, foundation, or even business-to-business. Some of the best partnership ideas come from experiences learned during trial and error; successful models, with the help of specialized partners, can be scaled up efficiently and cost-effectively.

Let’s talk about how BSR can help you to transform your business and achieve your sustainability goals.

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