Opinion: The private sector has a role to play in Latin America's development. Here's how.

Signatura presents Teneris, a secure and transparent procurement platform built using the blockchain, at the “Tech for Integrity” global hackathon competition in Buenos Aires, Argentina. Photo by: Signatura

Last November, the Open Government Partnership held its Americas Regional Meeting and one vital area of interest was examining the varied roles the private sector can play as a strategic partner. It examined how it could promote open government initiatives and help use design and implement technological solutions to increase transparency and accountability. Of course, such tools would mainly benefit things like the fight against corruption, better public contracting, spotting conflicts of interest, and promoting beneficial ownership. But they could also impact other issues of sustainable development such as gender or climate change.

Launched in 2011 by the United States and Brazilian governments, among others, this global initiative promotes the adoption by the adhering countries of open government national action plans. These include commitments, goals, and specific actions in order to promote transparency through website portals, tools, and open data that allow better information and monitoring of government actions by citizens. The initiative already has 75 country members and its approach is largely aligned to the mission of the United Nations Sustainable Development Goals.

In this regard, what are the types of strategies that companies can adopt to cooperate with governments in this field? And what are the concrete experiences that can be brought up in the context of Latin America?

As a first possible strategy, companies, and other private sector actors such as entrepreneurs, business chambers, and associations, should be taken into account by national governments at the moment of designing their national action plans, with the explicit aim of incorporating their points of view. As an interesting example, during its Second National Action Plan (2015-2017), the government of Colombia extended an invitation to the local Association of Business Foundations, or AFE, to be part of its plan’s steering committee. AFE is an organization that brings together 74 of the most important family and business foundations in the country, seeking to influence change and sustainable social development. For its part, Brazil included during the consultations and “co-creation” workshops of its Third Action Plan (2016-2018) the participation of private sector actors. For example, within its Commitment 10, that seeks to carry out an inventory of services provided by the executive branch, software giant Microsoft offered its expertise with the aim of developing methodologies and tools for citizens to use to evaluate public services. On the other hand, in its Third National Plan of Action of Open Government (2017-2019) Peru presents a specific commitment to the creation of “multistakeholder forums,” considering the private sector within them. Meanwhile, Argentina expects to incorporate a specific, separate private sector working group in its open government activities to be carried out this year.

As a second strategy, the private sector can provide spaces or platforms for the creation of innovative solutions. In 2017, financial group Citi carried out the global hackathon competition “Tech for Integrity”  to devise technological solutions to improve the levels of integrity and transparency both in the private and public sectors. Companies showcased tools developed specifically to promote transparency through crowdsourcing and in collaboration with allies and startups. One of the stages of the competition took place in Buenos Aires in May 2017, and one of the top prizes went to Signatura, an Argentine digital notary company that developed a blockchain-based solution to guarantee transparency in public tenders. The tool helps mitigate the risks of collusion and insider information by preventing proposals from being tampered. In Buenos Aires, this hackathon phase had the support of the city government, the Anticorruption Office and the Ministry of Modernization of Argentina, as well as companies such as Facebook and IBM.

A third way in which the business sector can encourage open governance is through the disclosure of data and metrics on its own sustainability performance. This allows different stakeholders — such as governments, regulators, consumers, investors, and employees — to access information and know how companies affect them based on environmental, social, and governance, or ESG, metrics. In this regard, the Inter-American Development Bank recently launched the IndexAmericas, the first corporate sustainability ranking for Latin America and the Caribbean. It lists the 100 public companies — both multilatinas and subsidiaries of multinationals operating in the region — with the best ESG performance. This index excluded companies that have been sanctioned by IDB for corruption, and sectors that have a negative impact on sustainability. It is expected that in 2018, the index will be updated and upgraded, opening it up in terms of other ESG metrics such as gender equality and corporate governance.

The inclusion of private sector points of view, the availability of their expertise, the facilitation of competitions for the development of technological solutions, and the opening of information about their own sustainability performance are key ways in which companies can collaborate with national governments and other public actors in order to promote more open and collaborative governance. Similar experiences and cases in this line are expected to multiply in the upcoming years, especially in regions like Latin America that already have a vibrant ecosystem of companies, startups and technological entrepreneurs that can be strategic partners of great value.

Read more Devex coverage on private sector engagement.

About the author

  • Gabriel cecchini

    Gabriel Cecchini

    Gabriel Cecchini works as a consultant in the field of governance, integrity, and ESG for public and private sector organizations, based in Buenos Aires, Argentina. Gabriel is Social Connector at the United Nations Foundation-led +SocialGood initiative, a member of the Private Sector Council, a group associated with the Open Government Partnership, and member of the Advisory Committee of the World Economic Forum/PACI project on “The Future of Trust & Integrity."