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By Darian Stibbe, Director of IBLF’s The Partnering Initiative

“Partnering with other sectors is a bit like being a parent. Until you’ve experienced it for yourself, you really can’t appreciate what it’s like” – head of education partnerships of a multinational bank.

Inclusive business (IB) projects, by definition, tend to sit in areas outside of companies’ traditional comfort zones. Whether providing incomes to disadvantaged people by including them in the company’s value chain, or developing new markets with pro-poor products or services, they are rarely business as usual, requiring a much stronger interaction with ‘society’ than traditional business. For most inclusive business models to work, companies must collaborate with those outside the private sector as implementing, intermediary, capacity-building or knowledge partners. For example:

• To develop a pro-poor supply chain will mean building the capacity of suppliers to deliver the quality, quantity and security of supply required. Sourcing of agricultural products from smallholder farmers is a classic example in which companies may need to work with government extension services to provide technical support, NGOs to help develop cooperatives, and finance institutions to help fund farmer capital costs.
• To include disadvantaged people as employees will often mean training them up. For example, construction companies in South Africa partnered with higher education colleges and the ministry of education to develop a new national vocational certificate that provided the skilled workers they desperately needed in the run up to the football World Cup.
• To develop new products and services that are pro-poor will often require firstly the expertise and understanding of needs that NGOs can bring to design innovation, and secondly the legitimacy, social capital and community engagement they can bring to implementation. For example, through the Banking on Change programme, Barclays works with Care and Plan International to develop micro-banking services in Kenya and beyond – well beyond Barclay’s traditional banking experience. Further, where such services are public goods, for example, provision of water or education, collaboration with public sector may be essential, both for legitimacy (social and regulatory) and for access to public infrastructure.

The International Business Leaders Forum’s programme, The Partnering Initiative, is providing the partnership elements of DfID’s Business Innovation Facility which supports inclusive business in five countries in Africa and Asia.

One of the challenges we’ve found is a lack of appreciation of both the importance to the business model of partnering, and of the difficulty of partnering effectively. There is a commonly expressed, and understandable, assertion that business is fully conversant with partnering – working with suppliers, customers and in joint ventures is, after all, an intrinsic part of how business gets done. However, for the types of partnership that will achieve inclusive development, not only is the partner – government, UN, community or NGO – a very different type of organisation to a business but the relationship is a quite different form of collaboration.

Let’s take the type of partner first. When companies work with companies, they are used to playing by the same rules, they speak more or less the same language, each company’s base interest – to make a profit – is clear, and there is 100% overlap of objective: one company to provide goods or services to the other at an agreed price that satisfies them both. Organisations from other sectors, however, have entirely different, public or social missions, they work to different timescales, have different responsibilities, accountabilities and cultures, are bound by different rules, and can have their own interests which may conflict – or be perceived to conflict – with commercial interests (particularly in the case of government which also has a regulatory role).

With respect to the relationship, what’s clear is that although partnership is one form of collaboration, not every collaboration has the attributes we, as human beings, tend to ascribe to genuine partnership: equity, co-creation, mutual respect, transparency, mutual accountability, sharing of risks, sharing of benefits; attributes that build commitment and get the best out of partners.

The distinction over what is or is not a partnership is not black and white and this lack of clarity risks leading to unhelpful semantic battles. To avoid this, The Partnering Initiative tends to think about a ‘relationship spectrum’ moving across between two extremes of characteristics – a purely ‘transactional relationship’ in which a company decides what it wants and purchases this resource from another organisation (e.g. pays an NGO to do a community consultation); through to a genuine partnership as characterised above, in which all parties collective bring their resources together to achieve something potentially quite innovative, that they couldn’t achieve alone. Sometimes a transactional relationship is exactly what’s required. Usually, in the context of inclusive business where multiple resources are required – including some, such as social capital, that are not available for sale – and for which the level of complexity requires a corresponding level of flexibility and commitment, there is no choice other than genuine partnership.

The former is indeed business as usual for companies and they can rightly claim authority here. The latter – like any human partnership – is much more complex, messier and harder. There is a loss of autonomy due to co-decision making and a reliance on others to deliver their roles; a necessity to understand and consider your partners’ needs and their limitations as an issue for the partnership as a whole; a reliance on teams of individuals with not just their own personalities and egos but also different institutional affiliations and underlying interests; and an ongoing requirement to manage the relationship to ensure equity, trust and mutual benefit alongside focussed delivery of the project.

Partnering across sectors is not for the faint hearted. It requires a certain mindset, courage to take risks, vision and commitment. It also requires a specific set of professional partnering skills and competences – as important to the end goal as financial or project management competencies.

The consequences of partnering badly are serious. Just as gears will grind to a halt when cogs are not well aligned and not kept well greased, so projects will be delayed or fail altogether. By partnering well, companies can achieve significant innovation in both product and market, move much faster to achieve competitive advantage, and greatly reduce cost.

In order to build effective inclusive business, companies – indeed all sectors of society – need to appreciate both the necessity and challenge of partnering, and take active steps to build their capacity to meet the challenge.

By Darian Stibbe, Director of IBLF’s The Partnering Initiative

Nearly two decades ago, the UN’s Rio Declaration had the goal of “establishing a new and equitable global partnership through the creation of new levels of cooperation among States, key sectors of societies and people”.

And then a decade ago, the major outcome of the Johannesburg follow-up Summit (Rio+10) was around the launching of 350 ‘partnerships for sustainable development’. Another decade later, more recently, Michael Porter has taken up the language of ‘creating shared value’. And now Accenture has developed the concept of a ‘convergence economy’ in which multi-stakeholder coalitions can effect systemic change.

It has been a journey towards deeper cross-sectoral cooperation to which IBLF and its member companies have contributed significantly since it was founded 21 years ago. This has been based on the understanding that, firstly, business needs a stable sustainable society in which to operate and secondly, that business, as a powerful and intrinsic part of society, has a great deal to contribute through the way it does business.

The current development landscape means that the case for cross sector collaboration is even more imperative. Aid budgets are being cut and governments and NGOs are looking for alternative resources, whilst the failure of traditional forms of aid to make systemic improvements, particularly in Africa, means that the sector is looking for alternative ways of working.

This means that in recent years, the range of initiatives which aim to promote core business-led solutions and promote and support inclusive or pro-poor business models has increased. IBLF is an implementing partner in a number of these including UNDP’s Business Call to Action, DfID’s Business Innovation Facility and SIDA’s Innovations Against Poverty.

How can we achieve effective and systemic collaboration?

Much has been said about the potential of cross sector collaboration, yet there remains the serious challenge of how to make it happen systematically, at much greater scale and with much greater effectiveness.

IBLF’s The Partnering Initiative was set up in 2004 to capture and disseminate the learning from IBLF’s 20 years of partnering experience and now aims to drive the use of widespread, effective cross-sector partnerships worldwide. A key part of TPI’s work is to look at how to make partnerships happen more systematically, and some of the key drivers we’ve identified are:

1. Motivation / awareness – leaders from across all the sectors need to understand the benefits of cross-sectoral action and be inspired by successes.
2. Means / capacity – bringing together different sectors with different values, interests, timescales and vocabularies is difficult. People often don’t appreciate the need to learn the skill set and develop the mindset necessary for effective partnering.
3. Opportunity – It’s essential to have the right platforms through which people from all sectors can meet, discuss issues, find common interests and spark possibilities.
4. Research and learning – finally this all needs to be underpinned by knowledge drawn from research on what works, what doesn’t work and why, and an enabling environment that encourages and rewards cross-sectoral collaboration.

In order to address the capacity issue, TPI runs major open training programmes such as our new Certificate in Partnering Practice course, and are delivering tailored training for a range of international NGOs and companies including Shell, BG Group and Microsoft. Our Partnership Brokers Training, which builds the capacity of those building and maintaining strong partnerships, has trained over 600 people around the world.

What would a systematic approach look like in practice?

We don’t have all the answers to this yet, but through our programmes of work we’re beginning to see the effects of a partnership approach.

In Rwanda, TPI is working with the Ministry of Education and UNESCO to engage the private sector in education through a multi-stranded programme.  As well as providing partnership training, we have hosted two Forum events bringing together leaders from across the sectors to promote education as vital to business and to Rwanda to meet its ambitious development goals and discuss opportunities for working together.

We’re already seeing the fruits of our labour, with a number of nascent partnerships beginning to bubble up including between the Ministry of Education and the Private Sector Federation to develop the Rwandan curriculum to be more in tune with the needs of business. And in an evaluation of the training course, close to 100% of participants said they felt ‘very significantly’ confident in developing partnerships, that they felt such partnerships were essential for Rwanda, and that their organisations would now actively pursue them.

In the Americas, we are working with the Pan American Health Organization to develop a Partners Forum for Action Against Chronic Disease. The Forum will promote, catalyse and support new multi-sectoral partnerships to tackle what is an inherently multi-sectoral issue: a rapidly growing unfit, unhealthy population that threatens to bankrupt health systems and eventually economies. Working at both regional and country levels, PAHO is planning an online platform and in-person events to exchange knowledge and to bring actors together, working groups on particular topics, and even a partnerships support unit within PAHO to help support specific partnerships.

In Bangladesh, we are working with the Business Innovation Facility and Care Bangladesh, to deliver a series of events – including awareness-raising for CEOs from across the sectors, and trainings for managers on building partnerships for inclusive business. We’re hoping to expand the programme to provide ongoing support and facilitation.

Some of the early lessons we’re drawing…

Ongoing programmes are vital – it cannot just be a series of one-off interventions, there needs to be physical local presence constantly providing support, constantly building momentum, and brokering possibilities into realities.

Local ownership is key. You need to get the business organisations, the government, the NGOs fully bought in and preferably running the programme themselves as quickly as possible.

Partnering with the public sector remains one of the hardest challenges, for a variety of legal, political and human resource reasons. As part of our ‘Partnering with Governments’ programme with GIZ, we developed a template for a ‘partnering landscape’ report to assess the enabling environment for public-private partnerships and we’re in the process of developing a couple of those reports. We’re hoping to then move on to working directly with governments on the legislative and capacity issues to help them become more effective partners. Watch this space.