April 12, 2016
Making UN and business partnerships work: 3 questions

Puvan J. Selvanathan, Head, ITC Office to the United Nations in New York

At the International Trade Center, a joint agency of the World Trade Organization and the United Nations, we focus primarily on business and exporters and how trade can contribute to inclusive economic growth. In this line, we are already working with the SDG Fund. We have some trade promotion activities in Africa, we also have agricultural productivity in small island developing states. There is already a relation between the ITC and the SDG Fund in terms of being able to upscale, capitalize, and accelerate projects that are naturally contributing to the achievement of the SDGs.

In improving the work between the UN and the private sector there are three points that I'd like to make.

One: how we would be able to work better with the private sector. We need to tailor solutions and the UN has to do a bit of work here. It's not good enough for the UN to simply say, “here we are.” We need to say that we understand the dynamics of these different actors, that we are willing to look at how to quickly set what would typically be large-scale public sector programs into what constitutes a realistic incentive for the private sector to participate. The outcome of all of this is not to make more money for companies. The idea is to ensure that as companies grow the economy, they grow the pie.

The second: business is about transaction, transaction, transaction, just as property is about location, location, location. For the UN system, transaction costs are very high. If you want to do anything with the UN, it takes time and it can take a lot of effort and resources. Governments have entire ministries that are dedicated to certain parts of the economy. Typically in a company, you only have one person who is involved in this and they have to cover everything to do with the government. This is not an easy job, to try to sell the UN Agenda. The transaction cost has to be looked at very closely.

There is also the transactional outcome of business, which in UN terms can seem to be very low. If a business transactional outcome is the need to make profit, unfortunately this does not sit well within the UN family. You need to look at the greater agenda here and unfortunately the transactional frameworks that companies usually work with are very short term. What is my return on investment? What is my CAPEX?  What is my exit strategy? These are not necessarily things that sit well within the UN language, but there must be a middle ground.

This middle ground is Point 3, which is "know thyself, and only do what you can do and do well, do not compete with each other".  The UN is not here to compete with the private sector. It is not here to set up subsidiaries; it is not here to do all those things that the private sector can do fantastically.  What the UN really needs to do is to enable the private sector to operate in a way that is commensurate with the expectations of other states and agencies. That includes NGOs, governments, and the world at large. Businesses cannot become governments or vice versa and the global goals do not ask for this. Simply put, the United Nations and Member States have realized they cannot do it all themselves.

We need to find a space for the private sector to come in and do is what is good for itself, as well as what is good for everyone else. We need to understand the shared imperative. It is not about us and them, it is not about us letting you work with them or them letting you work with us. There is no choice here: we have to work together. The UN from the outside is one thing. The UN in the inside is about 7000 things, all the different agencies, all the different programs.

There is a lot of competition within the UN to work with the private sector. The private sector should be able to leverage this. The private sector should not be afraid to ask the UN “what are you bringing to help me to do what I need to do?”

This article is an edited version of Puvan J. Selvanathan remarks in the launch of the report ‘Business and the United Nations: Working Together towards the Sustainable Development Goals: Framework for Action”