TOWARDS COORDINATED PRIVATE SECTOR ENGAGEMENTS FOR DEVELOPMENT: OLD OBSTACLES AND NEW STEPS IN PERU AND COLOMBIA

Jose Di Bella

DSA Annual Conference Birmingham, UK November 2013

- Background

- Private Sector for Development

- Aims of the Research

- Questions and Methodology

- Findings

- What this means for a Post-2015 agenda?

INDEX

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Background

• Busan 2011• Emerging donor strategies• Business and International Development• Southern perspective

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Private sector for development

“Firms’ active pursuit of positive development outcomes. This occurs through, funding and/or carrying out development projects, adopting and implementing inclusive business models, aligning core activities to explicitly contribute to the achievement of development outcomes, creating inclusive value chains, adopting and supporting the widespread adoption of responsible business practices in areas such as environmental sustainability and human rights, improving accountability and transparency in business operations, and targeting the transfer of technologies to host communities” (Di Bella et al., 2013)

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Aims of the Research

• Provide insight into the policies and practices of key southern development organizations to articulate private sector for development

• Identify constraints, challenges and new steps taken from a Southern Perspective

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Research Questions

• How are key development organizations engaging the private sector in Peru and Colombia?

• What are the main obstacles to further private sector contributions to development?

• What are the factors that enable/hinder private sector engagements for development?

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Methodology

• Preliminary review of Cooperation Agencies policies in Latin America• Choice of country (indication of private sector engagements and feasibility)• Mapping of other key and prominent development actors • Field visit and semi-structured interviews• Snowball approach

Organizations part of the sample

Peru Colombia

Peruvian Agency for International Cooperation (APCI) Colombian Presidential Agency for International Cooperation (APC)

Ministry of Social Inclusion (MIDIS) Department of Social Prosperity (Ministry DPS)

PERU 2012 (NGO for Private Sector) National Agency for Combating Extreme Poverty (ANSPE)

GESTINARSE (NGO - Development Consultancy for Private Sector) National Science Granting Council (ColCiencias)

Entrepreneurs Against Poverty (SEP)/National Society of Industries Social Investment Bank

GEA Group (NGO – Advisory Services for private sector) Gift to Colombia (Foundation)

Economic and Social Research Consortium (CIES Think Tank) Compartamos ( Capacity building foundation – NGO)

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Engagement for Development

• No involvement at Agency level• No objection practice at Agency level• National Ministry taking a lead to

articulate private sector through “tax for works” programs

• Ministry setting a out government priorities and “rules of the game”

• Private Sector initiative working closely with national ministry – Quipo comission

• Involvement at Cooperation Agency level

• New government programs to provide “predictability” and clear rules

• Social Alliances mechanisms provide entry points for firms

• Capacity building and information sharing complementary activities by foundations and NGOs

• Ministry move towards grading firms and matching social investments to the local level

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Results

APCI Peru APC Colombia

Lack of conceptual clarity Clear identification of private sector as Firms

Legal constraints Specific mandate to engage with private actors

No objection process Provide information and channel resources to regions

Lack of information about private social investments Partial information and tag of resources (international/national)

No strategy for private sector engagement No written strategy, but clear practice of how to engage

Main differences in Private Sector articulation at Agency level

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Factors that hinder engagements - Old Problems

• Lack of development expertise in firms (iso factor)

• Need for knowledge and learning exchange spaces

• Traditional views on the role of private sector

• Re-vindicatory and ideological discourses in meetings

• Lack of systematic information on private sector social investments

• Perceived saturation of bad projects and multiple requests for contributions

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Enable Engagement - New Steps

• Recognition of the shift from philanthropy to CSR to Core Business Models

• Baseline information and coordinated approaches• Opening new paths for engagement with “predictable”

rules and clear State development priorities• Private sector guilds involved in discussions with

Government• Government and international actors presence to

legitimize initiatives

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Discussion – A Coordinated Approach

• Agreed objective among multiple development actors to articulate the private sector (shared value proposition)

• Clear agreement on what is being asked from private sector

• Clear conceptual clarity opens basic engagements documentation to more sophisticated tracking and measuring strategies in development organizations for private sector for development interventions

• This emerging approach is leading to complex and coordinated interventions to the local level. (Vertical – Horizontal coordination)

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What this means for a Post -2015 Agenda?

• Call for streamlined agenda needs organizational streamlined strategies

• Converging tools, methods and evaluation

• Move beyond traditional views of private sector obligations in the framework of the New global alliance

• Donors and Governments can play a key role in identifying, promoting and enabling new inclusive business models and firms (What type of SME’s are created?)

Thank you.

Corporate Strategy and Evaluation DivisionPolicy Teamjdibella@idrc.ca