4.9 - Private Sector Engagement
GEF IW project experiences on private sector engagement can be found here.
GEF IW Project Managers should engage private sector organizations (companies, non-governmental organizations and private foundations) as a key element of their replication, sustainability and co-finance strategies. Starting a public-private partnership is not easy. It will take more time, effort and funding than you think. However, together government, not-for-profits, foundations and companies can accomplish much more than they ever can independently.
You advance and align business, environmental and social objectives by learning first about the drivers of the business. Most businesses approach the environment through the lens of risk. How does the availability of natural resources impact their business?
GEF IW projects are well positioned to offer shared value through shared problem solving to meet business and environmental priorities in communities where the project and organizations work.
There are several barriers to establishing a successful partnership including institutional and cultural issues, apportionment of long-term risk, public and political objections and time, effort and funding to finalize.
Highlighted Steps to Start a Public-Private Partnership
The key pathway for GEF PMs to start a public-private partnership includes:
- Identify project objectives and rationale for potential collaborations
- Identify private sector companies, NGOs and foundations with operations and/or priorities in your project’s region
- Identify project resource requirements, capacity needs and how private sector or other organizations can help fill these gaps
- Engage key potential partners that are strategic and will assist the project in meeting its goals and outcomes, including cultural fit, meeting user needs and reducing private sector risks to resource mismanagement
Most often private sector companies indicated the need for GEF projects to offer “business relevant” benefits and outcomes was a consistent theme of these discussions. GEF PMs called for the identification of case studies and lessons to assist GEF projects in consistent private sector engagement.
The following are key lessons learned from this outreach that GEF PMs might utilize in developing public-private partnerships:
- Private sector involvement in regions and watersheds where companies have operations can add value to the GEF’s actions and at the same time reduce the real risk local communities and businesses face if water resources are not protected. The value proposition is to reduce the costs associated with risk exposure and engage communities regarding how they will benefit from improved water stewardship.
- Companies and the GEF need internal champions to get buy-in and begin a dialogue.
- The need to further advance partner integration beyond sponsorships, or simply writing checks to support “public” programs. True long-term partnerships and commitments are needed. The strengths and ingenuity of the private sector should be harnessed to increase the value of the partnership beyond simply sponsorship.
- Public-private partnerships are well positioned to add value by helping companies achieve corporate environmental performance targets.
- Leveraging and influencing the supply chain can broaden impact and engagement.
- Partnerships must maximize the political and economic situation in each region.
- A project can attract the private sector through researching company interests, CSR, corporate goals, and objectives.
- The notion of “shared problem solving” ensures buy-in and cooperative partnerships.
Current Success and Practices
The following examples illustrate best practices and lessons learned in partnership development from current GEF IW projects:
- The GloBallast Partnerships developed a flexible industry fund (Global Industry Alliance Fund) to promote improved environmental and sustainable performance by funding training, technical assistance, technology development and technology standards. The fund is an annual subscription model. IMO acts as the fiduciary only and GloBallast Partnerships support the execution of activities decided by the GIA Task Force. Industry, through the GIA task Force, is responsible for making the annual decisions regarding how to spend the money. Companies can enter and exit the partnership and contribute to the fund as they please on an annual basis. The aim is to build a partnership for shared problem solving, rather than just mobilizing resources.
- The Yellow Sea LME project spent a lot of time in engaging NGOs/the private sector to organize coalitions. The YSLME developed a small grant program (15 to 16 small grants) of $10,000 USD each to assess mariculture techniques and help companies apply to be a sea grass protected area. The grants provided seed funding. They identified key experts and prepare documents with support from the project. In addition, the YSLME project partnered with a seafood production company that imports raw material to produce dry shrimp and products to sell to Japan and Korea, to protect one island in the Yellow Sea, which is a native sea cucumber area. The company provided the necessary financial resources and the YSLME project provided technical support. This kind of partnership can be replicated once a key risk to the company and its communities is identified and joint solution developed by the project in cooperation with the private sector.