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NGOs and the private sector

Summary of unpublished report¹

Recent research, carried out by an intern at Concern Worldwide, has examined the costs and benefits of public-private partnership, involving the non-governmental organisation (NGO) sector. The aim of the research was to better prepare and guide public actors in potential collaborations.

NGOs and the private sector have recently initiated a remarkable, though precarious, movement away from confrontation and towards dialogue and co-operation. Collaborative efforts are sought out and desired on the part of both the business sector and NGOs. The relationships between NGOs and their business partners are varied. Public private partnerships include activities such as fundraising or 'resource mobilisation', negotiations for lower product prices, research collaborations, consultations or discussions, arrangements to implement codes of conduct, corporate social responsibility marketing projects, and contracting out public services.

The main findings of the study were as follows:

Negative aspects of partnership

• Private sector actors may be using the interaction to gain political and market intelligence or advantage, in order to gain political influence and/or a competitive edge.
• Private sector actors may desire access to new 'untouched' markets to which the NGO has access. This compromises NGO legitimacy, credibility, and focus.
• Private sector actors may use the relationship to set the global public agenda.
• Private sector actors may offer research and development and access to information that is biased towards market effectiveness and profit rather than philanthropic or ethical motives.
• Private sector actors may recognise the appealing reputation and credibility associated with an NGO and seek interaction based on image-boosting.
• Private sector actors may seek out costeffective, technical solutions to complex problems.
• Private sector actors may prove to be an inappropriate choice when corporate image clashes with NGO objectives and motivations.
• Private sector actor involvement may undermine NGO control and principles in partnership programmes.
• Private sector actor involvement may divert programme interests towards decidedly corporate interests.
• Private sector collaboration may require an exclusive or limited relationship, binding the NGO to certain loyalties and limiting available support from other agencies and/or corporations.
• Private sector donations may be available under certain caveats or requirements that bind the NGO to those caveats.

Positive aspects of partnership

• Private sector actors may provide critical amounts of financial support.
• Private sector actors may award grants or donations without criteria for use or other restrictions.
• Private sector interactions increase availability and access to various contacts, political influences and technical expertise.
• Private sector actors may develop internal and external organisations for education, awareness and advocacy.
• Private sector actors may initiate and develop policy-making opportunities for the NGO.

Conclusion

Vast amounts of funding become available to NGOs as a result of collaboration, partnership, or donation relationship with the corporate sector. This may be funding that would otherwise be entirely unavailable to the NGO. Partnership relationships depend on the characteristics of the individual actors and the specific initiatives being co-ordinated for collaboration. It is necessary, however, that the positive and negative outcomes are equitably and appropriately evaluated and analysed prior to partnership. Understanding the private sector and its motivations, calculating potential positive and negative effects, and determining whether benefit exceeds cost may provide NGOs with guidelines and strategies for developing a positive, beneficial, and rewarding relationship with the business sector.

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Reference this page

NGOs and the private sector. Field Exchange 19, July 2003. p11. www.ennonline.net/fex/19/ngos