Q. Why do we need partnerships for development?
A. We have moved from a world in which the state had sole responsibility for the public good and business maximized profits independently of the interests of society at large, to a world where success depends on the close synergy of interest among business, civil society and state. Tri-sector partnerships benefit the long-term interests of the business sector while meeting the social objectives of civil society and of the state.
BPD's starting point was the premise that there was growing pressure on companies to deliver, and demonstrate that they were delivering value, both to their shareholders and to the communities in which they operate. Corporate social responsibility is no longer an addition to the bottom line, but integral to it. New forms of partnerships are emerging that maximize the long-term interest of the business sector along with the social and human development interests of the civil society and the state.
Q. Why is the private sector involved in partnerships for development?
A. The private sector is the engine in wealth creation. It has also expanded widely to sectors previously considered public services, e.g. from power and telephony, to education and health. Today most companies accept that their long-term investment goals can only be achieved within stable social and financial environments; thus, they are supporting a range of development activities. While not their core business, the success of these activities is essential to the success of their business. Increasingly, the business bottom line must be synchronized with the social bottom line for the communities in which the companies operate.
Q. Why is civil society involved in partnerships for development?
A. Civil society's role and influence is expanding. In the marketplace, the consumer has become "king". In the social arena, civil society has a growing influence on the behavior and governance of state, business and individuals. Increasingly, civil society plays a key role in assessing the business community's contribution to the development arena, rewarding community friendly behavior and criticizing the opposite.
In the case of BPD, civil society tends to play the role of honest broker ensuring that corporations are not merely engaging in partnerships to "greenwash" their tarnished public images, but will work to help meet the pressing needs of the world's poor.
Q. Why are development organizations, including the World Bank Group, involved in partnerships for development?
A. The role of development organizations is rapidly changing to adapt to these new realities. To achieve poverty reduction, development institutions' ability to affect the volume of private investmentboth domestic and foreignmatters as much, if not more than how much money is lent to countries. In 1997, ODA from western governments totaled $37.3b; private sector flows to the developing world exceeded $256b (a sixfold rise from 1990). In this context, partnerships with the private sector can be an important strategy for poverty reduction, looking at and influencing the totality of a company's impact on society.
For the World Bank, this means a whole new agenda of working with governments to create an environment which will attract both domestic and foreign private investment in areas such as: property rights, legal systems, guarantees, capital markets, financial sector restructuring and more. It means working with civil societyNGOs, foundations, and academic institutionsto help deliver development on the ground. It means working directly with business to maximize the development impact of resources flowing to developing countries, i.e. helping to ensure that more is achieved with resources which they are spending, and by increasing the effectiveness, encouraging them to spend more. The old order of the Bretton Woods institutions sitting on Mount Olympus and "doing development" from Washington is over. Partnerships with governments, civil society, private sector and other multilateral and bilateral donors, each playing to their respective strengths is the only way forward.