British Prime Minister Gordon Brown called this week for the support of multinational corporations to help achieve the United Nations’ Millennium Development Goals (MDGs) by 2015. Reports claim he is attempting to enlist the support of over 20 private corporations to use their expertise and resources for capacity building, infrastructure development and capital investments in developing countries. Calling the situation a “development emergency,” Brown believes that the lack of enterprise in some of the least-developed countries is inhibiting growth and the achievement of the MDGs. Private-sector companies already tapped for support include Vodafone and Google. In the coming years, Britain’s development minister will be focusing on initiatives in financial services, mobile phones and agriculture.
Brown raises a critical development issue - the need for enterprise investment to ensure sustainable economic growth in the world’s poorest regions. However, he failed to mention that ICT companies are focusing increasing attention and resources on fast-growing markets in the developing world. Companies like AMD, Intel, Microsoft, Cisco, Nokia and Ericsson have made significant business investments in developing countries. The reason for Brown’s omission may be that the public sector struggles to connect these investments with economic and social growth. Most large corporations, especially in the technology sector, have corporate social responsibility (CSR) programs but the size of philanthropic investments is inherently capped by market forces. These programs often pale in comparison to the business investments made by these companies in developing countries.
Private-sector companies can help the development community and the public sector appreciate the full social and economic impact of their activities in developing countries. The private sector has a direct and positive impact on the developing world through the expansion of local business ecosystems, the commercialization of new products and services designed specifically for these markets, and business models that increase the affordability of productivity tools. Because these efforts are profitable, they are more sustainable than philanthropic activities. Certainly, there is a place for philanthropy and CSR in addressing the challenges in the developing world. But a sustainable approach to addressing global poverty increases the longevity and size of resources committed to such investments. And corporations that identify credible methods for measuring and promoting the social and economic impact of their business efforts to the development community will experience greater business value through increased brand equity, visibility and an enhanced ability to influence local policies.
Also in the news: