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Oct 26, 2015

The next 15 years: highlighting the role of the private sector in development

Nisha   /   Nisha Agarwal

If you look at an overarching development framework such as the Sustainable Development Goals, one thing that is very different when we look ahead to the next fifteen years as compared with the last fifteen is the recognition of the role that the private sector is going to play. Even in 2000, when the Millennium Development Goals were introduced, people didn’t really think development was something that the private sector did. It was largely the responsibility of the government, and to some extent, civil society to mobilize people to set a more inclusive development agenda.

Now, when we set goals for the next fifteen years, they are wider, more diverse and much more ambitious. They include justice, peace, human security, gender equality and there is a very clear recognition of the fact that if we don’t get the private sector on board, these are never going to be attained.

The action is no longer in the United Nations, where we used to engage with governments. It is in Davos where the private sector leaders go, and they discuss the same issues that we do. Inequality worldwide has become as troubling for the private sector today as it is for governments or civil society. Global problems are global problems, whether it is climate change, inequality, extreme poverty, malnutrition or hunger, and there is cognizance of the fact that we’re all in this together.

Even as the role of the private sector is being recognized and highlighted globally, India is the only country in the world that mandates a minimum spend on corporate social responsibility. This decision came from the government itself, rather than as a result of pressure from civil society, because action wasn’t being taken voluntarily. The government probably felt they had made global and national commitments to halve poverty, to get every child into school, to reduce maternal mortality and I think they were ashamed that they were not meeting these goals.

So they’ve called upon the private sector to play its part. We’re living in a time when we’re creating a lot of wealth in the society. In India one per cent of the population owns 53 per cent of the wealth.

So surely they have a responsibility to the other 99 per cent. Aid has dried up. Who’s going to look after the fact that 48 per cent of our children are still malnourished? It’s our own responsibility. This mandate signals to the private sector that they need to participate. For the first time, the private sector cannot say that it’s not their responsibility.

The way for them to address these goals in not just through spending money on CSR. Ethical business practices in the whole supply chain is where the action is. The two per cent mandatory spending is a signal to invite the top companies to be a part of the change, but it’s the 100 per cent of how they do business that is going to be more important. Oxfam globally launched Behind The Brands, a project where we analysed the ten largest food and beverage companies in the world, and started to rate them on parameters such as how they treat women, workers, land, water, their impact on climate change. It became a tool of engagement and we worked with almost all these companies to delve deep into their business and see how they could improve them. Because the footprint of these companies is so huge, the impact of the measures they take can be huge.

Corporates, through the jobs they create, the goods that they buy and sell, and through their engagement with society, have a very large role to play in creating a more equal opportunity India.

Our tax base is so small that the government can’t do it alone, which is why they are looking to the private sector and reaching out through all the different means they have. Nobody’s asking for the companies for hand-outs; we’re just asking for giving everybody a fair share and an equal chance in life, and doing the right thing as a good corporate citizen.

The India Responsible Business Forum (IRBF) Index 2015 is an initiative by Oxfam India in partnership with Corporate Responsibility Watch, Praxis and Partners in Change, non-profits which look at corporate accountability and business responsibility.


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