Transformative Leadership -- A Clear Path to Sustainable and Inclusive Development

Disruptive change happens when government officials, business executives and social activists embrace a shared goal and collaborate with the mantel of leadership passing from one to the other according to the task at hand.
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Disruptive change happens when government officials, business executives and social activists embrace a shared goal and collaborate with the mantel of leadership passing from one to the other according to the task at hand.

The success of the Millennium Development Goals (MDGs) offers a case in point. The United Nations assumed initial leadership for setting those goals and mobilizing resources to achieve them. In 2000, it forged agreement among member states on the MDGs, an aspiration of which was to halve the percentage of the population living in abject poverty. While at the time, the MDGs were mocked by some as feckless or a mere gimmick, in fact, the goals were incorporated into the planning of public, private and charitable sector actors, and its poverty alleviation objective was achieved five years ahead of schedule. Encouraged by that success, the World Bank has now established an even more ambitious set of goals -- ending extreme poverty and boosting shared prosperity by 2030 -- marking the first time the Bank has taken on inequality as a core development concern. The United Nations will soon adopt the Sustainable Development Goals (SDGs) with those same objectives and shared assumption in mind. To attain them, leadership in all three sectors will be needed.

While intergovernmental organizations set the objective, it has been up to national governments to take the lead in creating the conditions under which those goals could be met, by establishing pro-growth macro-economic policies combined with social programs that expand opportunity. Those that have opened and connected their economies and privatized state-run enterprises have enabled the freer flow of commerce and the creation of significant wealth by the private sector. While their increasingly globalized economies have increased GDP and lifted many from poverty, they have left many behind, and searing inequity remains. Those leaders who have established robust social programs have had greater success in spurring growth that is inclusive. Not only does the World Bank agree that shared prosperity is essential to poverty alleviation, but the privately-funded Ibrahim Prize for Achievement in African Leadership takes note and rewards transparency, accountability and a commitment to equity. Under the leadership of this year's awardee, former President Hifikepunye Pohamba, Namibia made major strides in the areas of equitable growth, freedom of the press, respect for human rights, gender equality and improved health systems, among other accomplishments. President Pohamba exemplifies the positive role that governmental leaders can play when they provide public goods reliably and equitably. While the Mo Ibrahim Foundation shines the spotlight on ethical and capable leaders, Tony Blair's African Governance Initiative embeds technocrats in various African ministries to build the capacity of governments to meet their citizens' needs.

Pivotal leadership on the part of private sector leaders has resulted in smart investments that not only grow companies and economies, but broaden participation in those economies. Take, for example, the mainstream private equity firm The Abraaj Group, which is an industry leader when it comes to sourcing and investing in businesses in fast-growing economies in Africa, the Middle East, South Asia and Latin America. To ensure that social goals are met, the firm complements its investments with philanthropy and volunteerism aimed at addressing the inequities that can accompany rapid growth.

Not only are investors significant leaders in development, so too are the companies in which they invest. The pursuit of a combination of financial and social returns is at the heart of Natura Cosméticos, a Brazilian cosmetics company that recently became the first publicly traded company to attain a Benefit Corporation (B Corp) sustainability certification. Co-founded by pioneer Guilherme Leal, the company seeks to advance bio-diversity and sustainable practices. Other companies provide affordable access to cell phones, high speed internet, clean energy, vaccines and various agricultural inputs. These are among the technologies that both increase productivity and enhance quality of life.

While many companies build the pursuit of social objectives into their business models, some choose to partner with non-profits that have the agility, independence and technical know-how to help them meet their social goals. For example, large players in the garment, electronics and food industries have turned to non-profits like Verité to assist with a supply chain audit to assure that global labor standards are met and abuses are uncovered and addressed swiftly.

By supporting organizations like Verité, Human Rights Watch, Oxfam and others, philanthropies have taken the lead in creating the civil society infrastructure for inclusive development. Foundations and intermediaries have also leveraged markets by providing the combination of grants and loans to enable small enterprises to get a foothold in local and, ultimately, global markets. Omidyar Network combines investments in for-profit companies with grants to non-profit entities to stimulate economic activity at all levels in the global South. Acumen raises grant dollars, so that it can make debt or equity investments in companies producing products and services for the poor. Root Capital is an impact investing firm focused on agricultural development, the most important sector in many low-income countries and rural communities.

These efforts, among many others, have created companies. Those companies have created jobs. And now philanthropic and private sector leaders are joining intergovernmental agencies, governments and NGOs to offer the education and training job-seekers need to fill the jobs that await. Addressing the "jobs challenge" has become a priority of World Bank leader Jim Yong Kim, who convenes forums with leaders of bilateral aid agencies, with private sector CEOs and with foundation presidents to share strategies for promoting jobs-rich economic growth. Implicit is his understanding that each sector has an essential leadership role to play in development finance; leveraging one another will be the key to success.

This is the lesson of the MDGs. By combining leadership and learning, the public, private and charitable sectors may prove that the SDGs are not only bold, but achievable.

In just a couple weeks, members of the Global Philanthropy Forum will gather in Washington, DC to consider the SDGs and the role that each participant can play -- as a philanthropist, policymaker or business leader -- in achieving them. Many of the leaders mentioned in this blog will be there sharing lessons learned. Tune in to the livestream from April 22-24 and follow the conversation via #GPF15.