Public private partnerships pose challenges for companies, but those who persist can find their effo
Tuesday, June 6, 2006
Cross-sector partnerships — such as those between business and non-governmental organizations, or business and government — are an increasingly popular way for companies to contribute to society.
But making partnerships work can be difficult. Establishing clear rules of engagement and building trust is often a problem.
Too often partnerships are more like sponsorship, with companies footing the bill for projects in which they are not closely involved.
To be successful, partnerships have to have a strong business case.
“You can’t just subsidize businesses wanting to do things in developing countries,” says J?rg Hartmann, director of the Center for Cooperation with the Private Sector at the German Technical Development Cooperation (GTZ).
Speaking at a conference on Business NGO partnerships held in London in March, Hartmann highlighted the benefits of private sector involvement in development projects.
“The advantage of PPP [public-private partnerships] is that private sector investment means that the investor is still interested in the sustainability of the project,” he said.
The balance between charity and subsidy may be hard to strike. Hartmann advised: “be clear about the balance of the good cause and the business case and communicate accordingly.”
The conference session identified three ways for companies to ensure the success of public-private partnerships: drive up demand, take risks, and have patience with government.