5 ways to make your organization a great sustainability partner

Sustainability 2018

(UN Habitat, 2018)

This article is brought to you thanks to the strategic cooperation of The European Sting with the World Economic Forum.

Author: Darian Stibbe, Executive Director, The Partnering Initiative (TPI) & Dave PrescottSenior Associate, The Partnering Initiative (TPI)

The vision is clear and compelling: a world in which business prospers, societies thrive and the environment flourishes. Leaders from across all sectors understand the interconnectedness of their interests, drop zero-sum-game mentality and work tirelessly together to create ever-increasing value for all.

No longer the preserve of a few “progressive” companies, business writ large is a true partner in development, looking beyond immediate short-term financial results towards building long-term business and societal value. It adapts its business models and aligns its investments and core business activities, products and services in ways that contribute to countries’ environmental and development priorities (priorities it has had a hand in setting); it strategically invests resources of all kinds (technological innovation, funding, talent and energy) into the sustainability of its operations and supply chains, and more widely to strengthen the social, economic, infrastructure and environmental fabric in which it operates. The $12 trillion in market opportunities identified by the Business Commission are on course to being realized, creating up to 380 million jobs.

Governments, meanwhile, are doing everything in their power to encourage and support responsible, inclusive and sustainable business: to lead by example with state-owned enterprises; to build the right enabling, entrepreneurial, responsible investment and competitiveness environment; to consult on and fully include business needs in country development priorities; and wherever necessary use its regulatory and taxation powers to prevent irresponsible or unsustainable business practices, level the playing field and ensure competitive behaviour. People’s incomes improve and the increasing tax takes are funding social progress, including through better education and health provision.

And, of course, central to this vision and the hottest topic of discourse within international development: governments, business, NGOs, the UN, academia, are all working together through a rich tapestry of formal and informal partnerships, from the global down to the country level, aligning interests and combining their resources to collectively deliver on the promise.

It’s an exciting image. But unfortunately, it’s not one that our institutions, companies and NGOs are set up to be able to deliver. They are not institutionally fit for partnering, and the friction and heat that creates risks derailing progress towards the collaborative dream.

Image: Literature search; AlphaBeta analysis

The many macro- or system-level challenges to cross-sectoral collaboration, from investors in thrall to quarterly reporting to mistrust across societal sectors, are well documented. To date, little attention has been paid to the degree to which development actors (including business) are themselves fit for purpose to be able to partner effectively.

• A multinational gas company wanted to partner with a business network NGO in a Middle Eastern country, including giving them a grant of around $10,000. The gas company’s internal procedures required the same level of due diligence as a $500M international joint venture, with a 60-page form to complete and with requirements wholly irrelevant and impossible for a small NGO to comply with. In the words of the director of social investment, “Every day, I have to break our own rules to get anything done. Fortunately, I’m senior enough and have the direct support of our CEO. Without that, I would have been fired years ago.”

• A UN agency had rules requiring any partnership with a company to involve a minimum cash transfer to the agency. The requirement set a negative tone for agency staff beginning partnership discussions: “I felt like a supplicant, appealing to the largesse of the company, rather than an equal partner together working out how we could together create value for both [the UN Agency] and the company,” says one. It also demonstrates an all-too-common mental picture of companies as funders, not co-travellers.

• A previously successful partnership between a fast-moving consumer goods company and a household name international NGO broke down completely when the NGO partnership representative changed. The new person was a very successful director, used to making quick decisions, but was not cut out for collaborative working. As the company manager put it, “we went from openly discussing problems and working things out together, to what felt like an ‘us versus them’ relationship with our motives constantly being challenged.”

From ‘us versus them’ to ‘in it together’

Can we really expect organizations to shift the way they work and operate? They have optimized their existing approach organically over years, successfully delivering their own agendas in a way that is successful, rewarded (customers buy products, donors give more funding, voters return governments) and reinforced. To deliver a collective agenda requires a shift in approach, with partnering-conducive systems and process, capacities and culture. For this to happen, all sectors of society will need to undertake deliberate and targeted organizational change efforts to become institutionally fit for partnering.

While the specifics vary, The Partnering Initiative’s 15 years’ experience working with business, UN and NGO leaders has shown a surprisingly consistent set of internal issues and challenges faced by those at the coalface of collaboration – whichever sector they come from. Here, we set out five steps organizations can take to optimise their ability to maximize value from partnership:

1. Undertake an audit of the degree to which you are institutionally set up to partner effectively. Do you have a clear strategy in place on how partnering can deliver value for your organizations? In what ways do your existing systems and processes support or obstruct your staff in developing partnerships? What skills and capacities do you have in-house? To what extent is our culture encouraging of collaboration? What challenges do your existing partners face when working with you? What do they most value?

2. Ensure you have the support of senior leadership and (collaboratively) develop and disseminate a clear strategic imperative for partnering, setting out the key forms of collaboration that create genuine value for your organization. Enshrine it in policy and put some dedicated budget behind it.

3. With new understanding of the pain points of partnering, introduce clear processes for collaboration, from clearly signposted entry points for others to engage with your organization, through to systematically identifying and assessing potentially value-adding partnerships; and from partnership-optimized due diligence and legal agreements to management and evaluation protocols that can assess ALL forms of value, including both direct mission achievement and longer-term organizational gains around sustainability, reputation, positioning, etc.

4. Train and hire “tri-sector athletes”, as Dominic Barton – then the Managing Director of McKinsey – called them. Support them to develop a partnering mindset (which must include humility!), an understanding of how other sectors work and operate, the necessary trust- and human-relationship-building skills, and a technical knowledge of effective partnerships.

5. Finally, encourage a pro-partnering culture by assigning staff the time to develop partnerships, and give them the freedom to be creative and innovate, including the freedom to fail. Reward staff for the building of relationships, as well as the results that come from fully formed partnerships.

Partnering, particularly across societal sectors, is difficult, often with overly high transaction costs and too much friction between organisations. If we as a society genuinely believe in Agenda 2030 as a shared collaborative agenda, we must invest in the capability of our institutions, NGOs and companies to collaborate more smoothly and effectively. If not, we are setting ourselves up for a decade of frustration, and ultimately failure.

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