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GREAT insights Magazine

What Role for the Private Sector in the post-2015 Round of Goals?

April 2013

Lucci, P. 2013. What role for the private sector in the post-2015 round of goals? GREAT Insights, Volume 2, Issue 3. April 2013. Maastricht: ECDPM

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Many believe that the private sector has a role to play in a new development agreement to replace the current Millennium Development Goals. Yet there are few proposals specifically setting out what this could mean for the design and delivery of new goals. Drawing on recent debates, this article provides examples of three areas where a new framework could help shape companies’ behaviours.

As we approach 2015, the target year for achieving the Millennium Development Goals, discussions as to what will replace them are gathering momentum. While there have been a number of conversations about the role of the private sector in a new set of goals, there have been few concrete suggestions on how businesses could become involved in a new framework.

Why private sector matters

The private sector is critical to development. Most fundamentally, businesses deliver growth and jobs. In addition, companies’ operations have economic, social and environmental impacts in the places where they are located. As such, ensuring businesses act responsibly is also relevant for the purposes of a new set of goals. Further, in recent years, business has become more involved in development cooperation. For example, there are a number of multi-stakeholder partnerships, particularly in the field of health (e.g. GAVI or the Global Fund), that seek to leverage companies’ core competencies to deliver against development challenges (e.g. research and development and capacity to deliver specific goods and services). Increasingly some businesses are involved in these partnerships as they see some convergence between their interests – e.g. mitigating risks, developing new markets, cultivating sustainable relationships with customers and investors – and development priorities, such as food security, environmental sustainability, access to health and education among others.

But the role of the private sector in development is not without controversy, given that companies respond to commercial imperatives. While there are examples of areas where development and commercial interests may coincide (1), in others a strong rationale for public sector interventions still prevails (2). Drawing on recent conversations on the role of the private sector and the post-2015 agenda, we have identified three different areas for business engagement in a new set of development goals.

Economic transformation and jobs

The first one refers to on-going discussions about a new goal on economic transformation and jobs, currently high on the post-2015 agenda. This is clearly an area with strong potential for private sector involvement, as businesses, mediated and supported by government policies, will ultimately be making this goal a reality on the ground. Such a goal could take different forms. As a minimum, the relevance of structural change and economic transformation (a means rather than an end in itself) could feature in an opening statement signposting the importance of this issue while leaving the specifics to be decided by national governments. Alternatively, a new framework could be more prescriptive by having a separate new goal for (decent) jobs or suggesting further indicators to track the delivery of key enablers of inclusive growth, such as skills and basic infrastructure (3). The point is that any of these options, no matter how specific, could encourage governments to implement policies relevant for private sector investment.

Transparency and accountability

The transparency and accountability agenda is another area where private sector actors could engage with the new goals. A goal on this theme could be expanded to cover corporate behaviour not just that of governments. As an example, drawing on existing reporting frameworks and discussions held at the Rio+20 Conference, companies could be asked to report on an agreed set of economic, social and environmental indicators which demonstrate the impacts of their activities in these areas. In fact, a new development framework could encourage governments to mandate this as part of their listing requirements.

Global multi-stakeholders partnerships

Finally, as part of the implementation phase of the goals, some suggest UN multi-sector initiatives such as Every Woman Every Child, could be extended to cover other goals. A review of existing partnerships (4) suggests these are still fairly new and work in progress. Many experienced weak and complex governance arrangements and poor monitoring mechanisms (which means there is little hard evidence on their achievements). If these delivery mechanisms were taken up in a new agreement, it should be on the basis of well-articulated added value of such partnerships, a clear understanding of different actors’ motivations, expertise and resources leveraged, and any potential conflicts of interest. Most importantly, clear monitoring and evaluation systems would need to be in place to track evidence of progress.

These are just three examples of ways that the private sector could become more fully involved in new development goals post-2015. Once the main aim and design of a new set of goals becomes more settled – whether its priority remains poverty eradication, shifts to sustainable development or combines the two – it will be easier to think what role the private sector can play. It is likely that more specific conversations about implementing and resourcing the goals will emerge then.

Paula Lucci is a researcher at the Overseas Development Institute.

Footnotes
1. For example, targeting low income consumers with new products and services that help them solve a specific development challenge or involving local producers in supply chains.
2. This is particularly the case when it comes to guaranteeing access to basic services (e.g. health, education, basic infrastructure) to the poorest and hardest to reach.
3. Some are included in the current framework (e.g. access to basic education and water and sanitation), as they are desirable outcomes in themselves. There is a number of suggestions on how these goals could be improved. 
4. For example, see Bezanzon, K. A. and Isenman, P. (2012) ‘Governance of new global partnerships. Challenges, weaknesses, and lessons. Washington DC: Centre for Global Development Policy.

This article was published in Great Insights Volume 2, Issue 3 (April 2013)

Economic Transformation and TradeStrengthening European External ActionEU Development Policy and PracticePost-2015 Global Development AgendaMillennium Development Goals (MDGs)Post 2015Private sector

External authors

Paula Lucci