Aid and business for sustainable development: Emerging lessons from effective aid–business partnerships in the era of the SDGs

Ben Garside, James Luger, Aida Kowalska and Paul Steele
2016

Summary

This project aims to better understand the key features and functions of successful partnerships for sustainable development (SD) between donors, large enterprises, small, medium and micro enterprises (SMMEs) and the informal sector. It analyses how SD goals can be achieved through all scales and types of public–private partnerships (PPPs) between governments, donors, NGOs and developing economy entrepreneurs.

The paper draws on a broad exploration of over 40 case studies, of which 11 are analysed in detail. The 11 case studies, drawn from Asia, Africa and Latin America, were selected on the basis of meeting three criteria: documented evidence of sustainable development objectives/outcomes, inclusion of small and informal businesses, and attention to environmental impacts. They highlighted successful public–private SD collaborations in the areas of resource efficiency, health and sanitation, job creation and community income generation.

The case studies were analysed in terms of:

  • identifiable contributions to SD outcomes (economic, social and environmental)
  • the partnership type (PPP, voluntary agreement, community contract, and community enterprise)
  • the modality for aid finance (capacity/training funds, preferential loans, private funds, commercial financing, revolving funds and grants)
  • the role and key functions of aid (financing, convening, capacity, policy and transparency)

The analysis identifies five key functions of aid:

  • Financial: helping small, community based enterprises access complex, time-limited, and large-scale financial instruments.
  • Convening: taking the role of a trusted broker in bringing different stakeholders together and encouraging more transparent and less hierarchical governance structures.
  • Capacity building: supporting learning processes and building capacity.
  • Enabling policies: influencing or directly designing a supportive policy regime and enabling environment to encourage the emergence of small businesses.
  • Transparency: Reporting and sharing information in accessible formats, which can help build understanding and trust between project partners and wider stakeholders.

Source

Garside, B., Luger, J., Kowalska, A., & Steele, P. (2016). Aid and business for sustainable development: Emerging lessons from effective aid–business partnerships in the era of the SDGs (IIED Issues Paper). London: IIED.