Private sector investment in the developing world dwarfs official development assistance and yet nongovernmental organizations have long had a rocky relationship with the corporate sector.
But that is changing now as public-private and cross-sector partnerships are becoming more common. However, both sides have yet to still come up with concrete ways on how to create a partnership that works.
For example, technology giant Hewlett-Packard had a traditional corporate social responsibility department up until three years ago, when the company decided to step back and look at what potential it had in creating sustainable growth and innovation, not just transactional grantmaking. After some consideration, HP established a sustainability and social innovation department, which focuses on using the company’s assets, including employee volunteer time, to engage and work hand-in-hand with multilateral partners.
“We believe working together collaboratively creates better solutions, and also more sustainable solutions,” Paul Ellingstad, HP’s partnership and program development director, told Devex during the Millennium Campus Conference in Boston.
As corporations are becoming increasingly open to collaboration, NGOs and other potential partners now have more opportunities for program expansion and funding innovation. In order to better explore the potential of this partnership and find the ideal working relationship, NGOs must take the following into account when entering into a joint endeavor with a corporate partner:
Look for a like-minded partner. “One of the first things we like, like in any other type of relationship, is sincerity, genuineness, purpose, transparency – you know, being very clear about what you’re trying to achieve and how you want to work with others,” Ellingstad said.
Define the problem and make sure it lines up with the corporation’s social mission. For example, HP is most interested in education, entrepreneurship, health and community involvement. Microsoft, on the other hand, only works with nonprofits looking to build IT capacity (either by human skills or infrastructure) in order to create jobs in under-served communities.
Know the other players. The NGO should do a 360-degree study of the other key stakeholders involved in solving the same problem. In fact, Ellingstad suggested that NGOs approach HP’s key strategic partners before approaching HP for funding.
Establish monitoring mechanisms that align with your mission. For example, HP is focused on sustainable growth but some NGOs feel the pressure to produce results quickly.
“While that might create nice press releases in the short term, generally it doesn’t create sustainable solutions,” Ellingstad added.
NGOs should also be aware that not all corporations are interested in being pitched. For example, Microsoft does not accept solicitations for funding. Instead, the company has “staff on the ground” looking for “nonprofit organizations that are building capacity through technology,” Akhtar Badshah, senior director of Microsoft’s citizenship and public affairs office, said. The company’s only open solicitation process is through its strategic partner TechSoup, which donates software to 501©3 organizations.
At one point, Ellingstad described HP’s partner selection process as almost like “dating,” but NGOs might be better served by looking at it as a “marriage.” Corporate partners can be effective breadwinners, but the relationship is only good if you have the same approach and philosophy toward development. In fact, Ellingstad said that HP is likely to reject any NGO with a “prescriptive” attitude toward development.
“At times we get individuals and organizations that are, perhaps, very impatient, very absolute in terms of ‘We know what the problem is, we know what the solution is.’ [They] tend not to fit as well,” he said.
This is all still very heartening because, while funding hoops still exist, it is encouraging that corporations are creating the types of funding structures and partnerships that really promote sustainable growth and development.
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