Global Corporation as the Prime? Private Sector Engagement Depends on it!

A highlight of my work as a partnerships advisor is helping businesses of all sizes, and with clear sustainable development impact goals in place, find ways to work more effectively and in line with governments as part of public-private partnerships. These typically take the form of a company with a global presence asking us to liaise on their behalf with U.S. or European agencies working in developing countries, and around issues like increased market access, trade facilitation, climate smart agriculture, health access, access to finance and gender equity. Often times these companies are looking for additional funding to support their development initiatives.

The U.S. Agency for International Development (USAID), Millennium Challenge Corporation (MCC), Development Finance Corporation (DFC) and U.S. Department of Agriculture (USDA) tend to be the go-to agencies I approach for these discussions here in the United States.

It’s easy to love a scope of work that allows me to find policy action that supports business advancement, since I’ve been working on economic development challenges for the last 20 years. I’ve always seen business as a key driver for positive change in places where the economy needs a shot of adrenaline, or what’s more, market-driven fluidity. Businesses must have a good relationship with governments that build and support infrastructure, and are often drivers of the investments needed for effective markets in all places where they operate. Thus when a U.S. or European-based business needs help raising money in tandem with a government actor here in the U.S. or in Europe, I see it as an ideal way to engage in effective public-private partnerships that have mutual benefit for the business, the government agency, and the communities in need of greater investment support.

Recently I was asked by a corporate client of ours whether the company could be easily set up to “prime” a U.S. Government funded program to institute a market-building effort in a country of priority to their production efforts.

What does it mean to be a prime? Essentially a prime partner of a U.S. (or other government) entity is one that receives a large chunk of funding to carry out a key program for the government, and thereafter sub-contracts that funding to technical implementers to ensure the program is delivered as promised and guaranteed by the prime. The prime partner must keep track of deliverables, budgets, timelines, ensure the program is operating as promised, and report back on progress. Often times primes are big contracting firms, set up specifically to monitor and manage big U.S. (or other) government programs.

So can a private sector partner be set up to prime? The answer is yes.

Susanne Barsoum, Founder of Keylime, a marketplace for international development expertise, shared with me this: "Donors are looking for the kind of innovation and private sector engagement that large international companies are so well positioned to offer. International development and the private sector each have so much to gain working together."

And here’s why:

1. Governments are making it easier to work with them, especially for private sector actors. USAID has been working on its new private sector engagement strategy for the last few years, and its new partner initiative calls for private sector partners to engage more frequently than before as well. Other agencies, too, both inside and outside of the United States, are calling for more engagement and direct relationships with the private sector, including GIZ in Germany and MCC here in the United States, to reach more diverse communities and invest in longer-term sustainability in conjunction with market-building.
2. Businesses have international networks or technical expertise that often complement what governments can carry out on their own, and often have good relationships with local government officials in ways that may differ from those of the U.S. or European governments. Thus businesses as a prime partner can be a huge benefit to government programs, as they serve as a liaison and conduit for policies that promote market based approaches to development, transparency, anti-corruption and progress towards the United Nations Sustainable Development Goals (SDGs).
3. Many of the businesses wanting to engage with governments for funding match or leverage have excellent relationships with nonprofits and civil society actors that have the technical expertise and depth needed to carry out programs as sub-contractors. Thus businesses won’t have to search far and wide for subs to help build out robust programs.
4. Over the last five years or so, businesses operating globally have come to understand the importance of economic development, and rural development in particular, as key drivers towards long-term sustainability for their businesses. What this means is that businesses are more able to incorporate traditional sustainability and social impact investments directly into their business actions rather than devoting those dollars through philanthropic means alone. This leads to longer-term business gains, a more conducive environment for development wins in country, and political wins for the agencies with which they are partnering (or priming in this case).
5. Global businesses have resources to support the administration of large contracts. The reporting and project tracking needed to serve as prime is not something to balk at, but big businesses are not strangers to similar, complicated requirements. Additionally, many government agencies are working to eliminate the onerous reporting, especially for the private sector.

Are you a business interested in learning more about opportunities to partner with government agencies to leverage funding and help build long-term market action in countries of importance to your business? Let's discuss!