How Public-Private Partnerships Can Help Build Nations’ Brands by [email protected]
Gilbert Probst on how public-private partnerships affect nations’ brands
Public-private partnerships (PPPs) have gained popularity in recent years as a way to address social and economic problems that are difficult or impossible for a single entity to tackle — such as alleviating poverty, increasing access to education or building resilience to floods. Often aided by multilateral organizations like the World Bank or the World Economic Forum, PPPs bring together national governments, private businesses, civic organizations and donors. As the participants pool resources and expertise to address the problems, they also help create and strengthen their own brands — be it companies or nations.
[drizzle]Those benefits sustain the attractiveness of PPPs with multiple stakeholders, according to Gilbert Probst, managing director, Leadership Office and Academic Affairs and dean of the Global Leadership Fellows Program at the World Economic Forum in Geneva. He works in the area of managing growth, learning organizations and knowledge management, and consults with major companies worldwide. In this podcast, Wharton marketing professor David Reibstein, who has done extensive research on the growth of nation-brands, interviews Probst on key PPP issues. The discussion comes ahead of the Wharton Nation Brand Conference that Reibstein will host on October 28 in Philadelphia.
An edited transcript of the conversation appears below.
David Reibstein: I want to talk to you about public-private partnerships because you’ve done a lot of work in that area. How do you go about defining a public-private partnership?
Gilbert Probst: I don’t want to make it too academic. In general, there is a new collaboration paradigm. I truly believe that collaboration is the paradigm of the 21st century. [The origin of] public-private partnership goes back to the early 1990s. All over the world, both at strategic and operational levels, key players from the public sector, business and civil society are working out how to [collaborate] as partners to find long-term solutions to the most intractable problems facing us environmentally and socially, but also economically.
Reibstein: Could you give us a couple of examples?
Probst: Sure…. Public-private partnerships were commonly associated with tender-based infrastructure projects and contracting out. But in the last [few] decades, we have seen a trend towards public and private actors more collaboratively addressing societal challenges that one of them alone cannot solve. The areas are health, education, water [and] poverty — where we need all the different stakeholders to collaborate.
At the World Economic Forum, we have one [initiative] called “New Vision for Agriculture,” where you have 33 global companies, 19 governments, international and donor organizations, civil society organizations and farmer associations, and the idea is to build a leadership commitment to action, where you try to improve productivity, sustainability and economic benefits in agriculture. [It also aims to] improve whole value chains, and that’s typically where you have to include all the stakeholders. Most of the projects are in Asia and in Africa. It is a committed, multi-stakeholder network that tries to solve the problem of food security, and this includes the need for a new vision for agriculture.
The Tropical Forest Alliance (hosted by the World Economic Forum) is a new one that goes in that direction [of public-private partnerships], where again, one country alone, but also, business alone cannot solve such problems.
“I truly believe that collaboration is the paradigm of the 21st century.”
Other [public-private partnerships] are in water distribution and water use. That is a worldwide problem and probably one of the top problems. Much more important than oil and gas in the future will be water — where, again, a country alone or business alone cannot solve the problem.
Reibstein: Often, what I see is some coalition of countries working on a particular problem … like agreements about the environment. I’m trying to think about the role of companies in that, as well. In the New Vision for Agriculture, are there specific companies that are involved?
Probst: Oh, yes, there are. [It includes] BASF, Bayer, Cargill, banks like Rabobank and others. You [also] have Monsanto, Nestle, Unilever and Wal-Mart. They all are corporate champions that invest a lot of time, their experience and their knowledge. Then you have the countries like Vietnam, Indonesia, Myanmar, Philippines and India. You also have Africa, Tanzania, Ethiopia, Kenya, Rwanda and others. You have global platforms and funding that come from countries like the U.S., Switzerland and the Netherlands. Then you have international organizations like the FAO (U.N. Food and Agriculture Organization), the High Level Task Force and the WFP (World Food Program). You have civil society organizations like the WWF (Worldwide Fund for Nature), Oxfam and GAIN (Global Alliance for Improved Nutrition). They all agree that one alone cannot really solve a problem. That’s where public-private partnerships became so important.
Reibstein: We’re addressing big, public issues [with such partnerships]. I’m curious — are your companies participating in this out of philanthropic interests, PR interest or is there some economic aspect for those firms that is behind their motivation?
Probst: Well, there is an economic interest. There are a lot of different interests, actually, that come together. It can be because you have the experience and you see that you can contribute. Or you see the necessity. Necessity can be responding to investor or shareholder demands, and that’s something that is growing. It can be because you want to meet host government requirements. It can be because you can only fund or finance projects in collaboration with a nation. But it’s also creating legitimacy, in a sense — protecting or creating corporate brand and reputation.
I could say the same, by the way, for nations. It can be because you want to commit to values and principles and you want to show that you live up to them. One that comes more into play is attracting and motivating talented employees. There are several cases where we could see that — where at the beginning the company or the employees were reluctant to work for because they felt this is maybe not the core business or these are not the projects that have most visibility. And then, they got a lot of motivation and positive feelings out of it — also, a feeling that companies are contributing.
Another one is LET, or the Logistics Emergency Teams, where logistics companies got together to help in flooding or any catastrophic situation. (LET is an alliance formed by logistics and transportation companies Agility, UPS and Maersk and facilitated by the World Economic Forum to support the U.N. World Food Programme.) They invest in it because they get access to governments. Also, it is motivating for their employees. They can develop new services or new procedures.
Reibstein: I am hearing a multiplicity of motivations, one of which is that it’s good image-building for the company – within, for employees, to make them feel better about the company they work for, but also externally. Do some nations participate in these alliances because it’s good for their nation’s brand to be associated with these endeavors?
Probst: Absolutely. Nations participate, of course, when there is a need — when there are real problems. That’s one…. If you have a