International Development Is Changing and So Is What Makes Good Business

It involves government, local and national; it involves a not-for-profit and it involves a private company with detailed knowledge of a specific technology and the willingness to adapt it to a specific requirement.
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I have been going to international development conferences for some time and I've noticed significant changes both in personnel and topic over the years. Whether it was the recent World Economic Forum meeting in Abuja or the New York based Shared Value Leadership Summit, one thing is clear: they're far from dominated by the old jargon of multi-dimensional development indicators and such-like anymore. Conversations are more likely to turn on investment opportunities. This isn't surprising. In Africa, for example, economic growth projections remain above 5 percent for 2014. Nigeria's population of 160 million is alone expected to surpass that of the United States by 2050. So now is clearly the time to get ahead.

But how has all this impacted on the "outcomes focussed" crowd (which I am part of), which is, despite much progress, still facing those multi-dimensional challenges: poor literacy, healthcare, access to clean water etc.? To my eyes, a lot has changed. In fact our group may have grown to encompass almost everyone who is serious about doing business in Africa. Indeed, it may be possible to discern the outlines of a cadre of new development leaders with skills drawn from each of the traditional sectors.

Consider these examples we have come across through our ongoing work on cross-sector convergence.

In Tanzania, where the Vodafone Foundation works with a pioneering NGO called Comprehensive Community Based Rehabilitation Tanzania (CCBRT), nearly three quarters of the women admitted for Obstetric Fistula procedures at participating hospitals were admitted via a programme called Text to Treatment.

So what?

Well, what's interesting about Text to Treatment is that it involves all the sectors of society converging to address an identified problem. It involves government, local and national; it involves a not-for-profit and it involves a private company with detailed knowledge of a specific technology and the willingness to adapt it to a specific requirement. Of course, to make Text to Treatment work you need the public roads and the hospitals offering treatment. You also need the expertise and, in this case, reserves of trust that an NGO can bring. And you need someone who knows about mobile technology to have a Eureka moment.

Or what about the restaurant chain Nandos partnering with the mining giant Anglo-American and Coca-Cola to create a Mozambique Malaria Performance Bond to fund malaria reduction efforts. This is not your usual financial instrument, it's a Development Impact Bond (or DIB). DIBs bring together private-sector investors, non-profit "private sector service delivery organizations," governments and donors to deliver specific social outcomes in effective ways. The various investors provide the capital required to the service provider. The private investors are only repaid by an outcome funder (typically donors and/or public sector commissioners) based on the impact achieved by the service provider's social program. If the social program succeeds, investors get paid, but if it fails, investors lose some or all of their investment. The British government launched its own DIB last month, aimed at preventing sleeping sickness in Uganda.

For me, what's most interesting about DIBs is that their very existence represents a shift in thinking: a reframing of development challenges as investment opportunities too. I co-authored a paper last year looking specifically at the investment opportunity of education. If the world continues to grow at this pace it is going to need a lot more highly skilled workers, especially in fast growing markets. Why should it be governments alone who bear the responsibility of educating this future workforce when businesses rely on the new talent too?

It may be too early to say whether a distinct "fourth sector" may emerge in the future drawing on skills from each sector. But don't just take my word for it that we could be seeing a move towards this. When Accenture and the UN Global Compact studied the views of 1000 top CEOs last year, 78 percent of them told us that partnerships across sectors would be instrumental in the way their company delivers social and environmental outcomes over the next five years.

It could be that the Davos-type delegates of the future look back with bemusement that we ever placed such important human development issues in hermetically sealed silos, for the attention of one particular group of people only. We shall see.

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