NGOs no longer set the agenda for development, say CEOsBy Tim Smedley
Source: The Guardian
Survey reveals 84% of businesses want to do more to shape development, meaning it is time for NGOs to up their game.
The world's largest CEO study on sustainability to date launches today with some worrying messages for the NGO and development community. The joint study from the UN Global Compact and Accenture which runs every three years, surveying more than 1,000 CEOs from the world's largest businesses, has found that just 15% of respondents (down from 27% in 2007) rank NGOs among the most important stakeholders in influencing their approach to sustainability.
"The message seems to be 'you are not setting the agenda,'" explains Gib Bulloch, executive director of Accenture Development Partnerships. "A decade ago NGOs were very much in the campaigning mode, some still are ... but the findings suggest there are other stakeholders who are clearly having a bigger influence on business. The positive spin [for NGOs] is it doesn't mean you are irrelevant, it means that your role is changing."
The report shows a business community largely committed to sustainability issues, with 93% of respondents saying that environmental, social and governance issues are important to the future of their business. There is also a clear broadening of private sector ambition away from the more traditional CSR issues towards wider global development concerns.
A vast majority (84%) of CEOs believe that business should lead efforts to define and deliver new goals on global priority issues and 16% include poverty eradication among their top three sustainability priorities.
The good news for NGOs is that business recognises the need for cross-sector partnerships in order to address these issues. The report states, "business leaders are firmly committed to partnering with NGOs to engage more fully in the development agenda", with some 78% of CEOs surveyed seeing a need to take action through on-the-ground partnerships and projects; 45% also report tangible business opportunities and value from previous collaboration with NGOs.
"Business is up for playing a bigger role in development," says Bulloch. "About 84% want to do more in shaping development and a third, 33%, don't think they aren't doing enough ... that screams opportunities for the NGO sector."
The private sector's model is moving ever further away from philanthropy, which the development community is most comfortable with, and toward market development, which is less comfortable for many. NGOs need to lose their hang-ups around profit, argues Bulloch. "My firm view is that some of the biggest challenges in development are in fact market opportunities in disguise ... [for example] the millennium development goal around education: can you invest in talent, can you stop kids from dying and get them well-nourished in the first two years of life, can you get them into schools, and have them as economic assets in 20 years time? That's a huge return."
Emerging business models highlighted in the report include pharmaceutical company Novartis's health services business Arogya Parivar launched in India in 2007. A for-profit social initiative, it was developed to provide health services delivery in rural India, allowing patients access to treatment at a low, fixed price for the first time, and giving Novartis a programme that was profitable within 30 months, with sales increasing 25-fold since 2007. This programme claims to have resulted in improved access to medicine for 42 million people in 33,000 villages, with the company since launching similar initiatives in Vietnam, Kenya and Indonesia.
"I think profit does have a role in development, not the profit maximising model but profit optimising, doing more with less, driving efficiencies," says Bulloch, who informs that another "big pharma" player, GSK, have also launched similar models. "Novartis has gone to thousands of villages, the reach is just incredible ... my personal view is that there will be more business model innovation and creation of these new for-profit businesses ... maybe NGOs need to get into bed with them and create new revenue models that will deliver outcomes – and if you deliver the outcomes at half the cost, frankly it doesn't matter if you're making profit or not."
The report also raises the prospect of business going it alone on development projects. In addition to public-private partnerships, business leaders report an equal willingness to explore business-to-business or private-private partnerships: 54% of CEOs are prepared to co-invest with other companies to make progress on sustainability issues. "I'm not sure this means entirely by-passing the public sector," Bulloch explains. "But too much of development has been this one NGO, one business, one issue, one country, bi-lateral relationship. Whereas what we really need to go to is more value creating coalitions if you will, that bring the complementary capabilities of different private sector players together.
"It's a bit like looking at individual musicians or an orchestra. We've got some really good soloists out there but what we really need is a symphony, and somebody needs to play the role of conductor."
That, he suggests, is the new role for NGO. There is a window of opportunity for NGOs to get in there and capitalise on the willingness to engage and the frustrated ambition of the private sector, says Bulloch. "But that window isn't open for ever. We've seen attitudes change quite quickly over the last three years. I don't think you've got another three years, it's probably a 12 month window in which to up you game or change your game."
|Global Partnership | Development | NGOs|
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