Business, the Millennium Development Goals and beyond
Andy Wales - SVP, Sustainable Development, SABMiller
Fathima Dada - President, Schools International Business Unit, Pearson
Ann Bernstein - Executive Director, Centre for Development and Enterprise
Tashmia Ismail - Faculty and BOP Hub Manager, Gordon Institute of Business Science, University of Pretoria
What has been your engagement with the post-2015 agenda so far?
Fathima Dada (President, Schools International Business Unit at Pearson) stated that business actors did not participate much in the process that conceived the Millennium Development Goals (MDGs). That is changing with the discussions around the post-2015 agenda and what will replace the MDGs when they expire in 2015.
Pearson has been fairly involved in the current post-2015 process. Firstly, they provided input to the High-Level Panel of Eminent Persons advising the Secretary-General on post-2015, and they are also participating in a number of relevant initiatives, such as, Education First, the Business Coalition for Education and the Global Compact on Learning.
Andy Wales (SVP, Sustainable Development at SABMiller) also stated that private sector actors are currently more involved in this agenda than they were with the MDGs. There are a group of progressive multi-nationals who have been very involved (e.g. Paul Polman from Unilever sits on the High-Level Panel advising the UN Secretary General on post-2015). The same applies to a range of fairly big food and beverage companies that have been involved in this process through the World Business Council for Sustainable Development and the World Economic Forum and through the various dialogues that have been going on. For example, he gave evidence to the High-Level Panel in London in November. However, he suggested there are still huge opportunities for businesses to be more involved, particularly at the national and local levels.
In addition, he suggested there is a risk in the way that business gets added in this; that is, that it ends up being more weighted towards the ‘do no harm’ agenda than towards ‘enabling growth’. In his view both are needed. However, if a new agenda is to gain traction from thousands and thousands of businesses, particularly at the national and local levels, it needs to be inspiring and focus on understanding how businesses drove development in the past, and how to make the most development impact in the future. For example, by helping them understand what their impact on growth is, integrating better decision-making throughout the value chain (e.g. sourcing, manufacturing and distribution). Having the right transparency steps in place is also needed; reporting helps to ensure businesses ‘do no harm’, but that is not the agenda that will inspire businesses, in his view.
Ann Bernstein (Executive Director of the Centre for Development and Enterprise in South Africa) was one of the first people to criticise the MDGs from a business perspective in her book on business and developing societies. She thinks the MDGs are an example of what business should not do; they should not sign on to other people’s agendas, without thinking about it carefully. Further, given the capacity challenges facing developing countries, having more than 3 or 5 priorities is already too much. She was also critical about the fact that the MDGs did not mention infrastructure, competitiveness and a whole range of issues that are vital for doing business in developing countries and to grow those economies.
She also criticised the fact that the MDGs did not bring in markets and entrepreneurs more prominently in thinking about how to achieve these goals. She stated that in many countries over the world private schools for the poor are now schooling the majority of poor people. In her view, there are many cases of better quality education provided in privately-run schools by local principles and entrepreneurs. She emphasised that how we achieve whatever goals are agreed upon post-2015 needs much more thought. And in her view, companies should not sign up to goals that cut private sector markets from how to achieve these goals.
If we agree that the economic dimension was left out from the MDGs and we have the opportunity to have it this time round, what would this economic dimension look like?
Fathima Dada mentioned that the point about the need to include infrastructure was a relevant one. In addition, policy-makers really need to think about the fiscal and regulatory environments. In a lot of these countries that are in most need, businesses face the greatest challenges.
In terms of specific indicators, for example in the education sector, she emphasised we need to look much more at quality outcomes rather than access. Many countries have now achieved close to universal primary education, but if you look at international benchmarks (in the few countries that participate in relevant tests) education is not up to the standard that it should be. There is much more that could be done in terms of quality.
In terms of on-going monitoring and implementation of post-2015 goals, she thought more could be done in terms of getting better at sharing best practice. If you look at the social dimensions that have a huge influence on education outcomes, for example, hunger and malnutrition. Is there best practice we can learn from in terms of school feeding programmes? In her view this is not done systematically enough.
With regards to international benchmarking, she mentioned that the OECD PESA test is a really good measure of numeracy, literacy and the scientific level of 15 year olds. Further, this also now includes economic indicators that link back to the education system. However, very few developing nations participate in these tests. The OECD has funding to implement it in some developing countries, but there is not an appetite for it. She thought the private sector, particularly companies in the testing space, perhaps could help to bridge this gap.
How could a new set of goals incentivise business investment and job creation?
Andy Wales stated it would be good if the High-Level Panel came back with a document that said ‘Goal 1: Enabling Growth’, although he did not think this was going to happen. He referred to the fact that growth was ultimately behind progress towards the MDGs in many countries.
He also emphasised that a goal looking at enabling growth needs to be very well-designed. First, it would need to incentivise business to invest and design their value chains in smart ways. Second, it should include something about transparency; progressive business should not be afraid of that. Third, it could include something about the different types of partnerships we need to see between businesses and other stakeholders. Finally, it is important to think about the resource side of things, the water-food-energy nexus. For a company like SABMiller this underpins growth; if they do not get the right balance between those resources correctly, growth would suffer very quickly. He sees an opportunity for businesses to be quite smart about the impact they can have through their value chain. SABMiller is known from their work in Africa, but he described an example of their work in Latin America. A few weeks ago at the Latin American Economic Summit they launched a programme for 40,000 small retailers across Latin America for 3 years. 60% of the product is sold through small retailers to help them grow their business much more rapidly through micro-finance, education, and a whole range of guidance particularly around what being a good retailer means. They are designing this scheme with the Inter-American Development Bank. Partnerships like this one, integrated into the value chain, rather than being philanthropic are the things that business can do more of and goal around enabling growth could perhaps help to incentivise this.
Ann Bernstein made the point that you need to think hard about whether the MDGs are a good idea. So much of national development is based on local circumstances, local politics and demand, that there are some problems involved in a big push for global goals. For her, the most important goal or issue would be around competitiveness. As an example, she mentioned the impact that the World Bank’s doing business index has. Many African governments look at the results and they want to know why they are slipping on certain indicators. It encompasses what Andy Wales talked about in terms of growth but it would probably be more amenable to some type of ranking and benchmarking. She is in favour of competiveness, which has a more local component; different countries decide how they are going to compete and they are judged on that, and it provides space to think much more creatively.
Ann Bernstein also suggested that businesses could have a role in clearly stating that ‘the fewer goals the better’, because of the realities of diversion and capacity. She thought businesses should be very selective, look at what really matters for them in nation states, and make that case, make that case in those countries and in other forums. But companies should think hard and not just go along with this agenda, which is often driven by Western countries.
Fathima Dada (President, Schools International Business Unit, Pearson) added that a role for business would be to help government think about how to take best practice to scale in terms of how to achieve the goals; but also help to set and monitor the indicators. She thought that adding some economically orientated indicators would be useful.
Ann Bernstein emphasised that growth underpins social development, but it also requires a smart effective state. The how question is also very important and one of the things that business leaders can do is talk about markets and entrepreneurs. In the case of education, rather than asking whether 98% of children are in primary in school, it is more important to know how many can read and write and how they do in PESA and what is the link between education and work and entrepreneurship and innovation. She is not convinced about the usefulness of global goals, because she has seen diversion. But if there were global goals, she thinks they would have to be very few, economically rooted and in the how they would need to consider markets and entrepreneurs much more that global agencies did in the past.
If you could have your goal in the post-2015 agenda, what would you like to see?
Fathima Dada stated that she would like to see learning outcome improvements using existing capabilities such as the international tests. Most importantly, developing countries need to have a big role in determining what the goals and indicators should be, and whether they are global indicators or local ones, that are meaningful at the country level.
She also stated that the MDGs became popular later on, so there is a need to popularise them through advocacy and communication early on so that people understand them and engage with them.
Andy Wales suggested he would like to see something around enabling growth, job creation, quality jobs creation. He thought we must not create a twin-track process where international policy runs separate from what drives national policy; those processes need to be connected. He thought we also need to understand that all the work done around sustainability, water, food, energy is about access but also about enabling that growth; the same goes for education and skills, there is a need to connect all these issues much better.
Ann Bernstein thought growth or competitiveness should be the most important issue. She is in in favour of growth and competitiveness as a key concern, which assumes the need for an effective state and vibrant markets. This is an issue where developing countries have different interests from people seating in developed countries and we should debate this. She warned against assuming that we all agree with each other because we agree on a specific goal. There are different interests; there are differences around development strategies that need to be debated much more carefully and seriously. Bigger companies will have different interests from smaller companies; so we should not talk about ‘business’ as a sector as there are so many different players.
As the world starts to explore what framework might replace the Millennium Development Goals (MDGs), the Overseas Development Institute and Business Fights hosted a high-profile event timed to coincide with the World Economic Forum Africa Summit to discuss how a new Post-2015 development framework could strengthen the contribution of business to development.
This event aimed to explore the views of those investing and doing business in Africa and to understand how best to harness business as an engine for economic development in the context of a new set of development goals.