Yesterday as I was browsing through BCLC’s global issues web portal on water, I couldn’t help but think about what else corporations might be leaving behind when they’re done a water access project. On the day after a water project is completed, there just might be more that has changed besides greater access to drinkable water. It’s possible that corporations are not just leaving behind tangible projects, but also intangible processes.
When multinational corporations are part of building or doing anything, there is bound to be a transparent, documented, competitive process for procuring what they need to build the final product – be it their core final product or a product as part of their social responsibility activities. What I’m curious about is whether those processes are also passed on to the community so that it can begin using transparent, documented, competitive processes to build other things that they need.
Procurement processes are in CIPE’s crosshairs as a way to encourage communities to define for themselves what is the rule of law. “Rule of law” is often a nebulous term, tossed around international development circles in reference to the general difficulty of doing business in emerging markets. Public procurement processes are just one of the concrete areas where transparent, documented, competitive procedures help establish rule of law and create new opportunities based upon it.
The Federation of Economic Development Associations (website in Arabic) is a grassroots organization of SMEs in Egypt that made news in 2004 when it played a significant role in drafting Egypt’s SME law requiring that SMEs be awarded no less than 10 percent of Egyptian government procurements – a significant step toward a more open process that had previously been exclusive to large, politically connected firms. Since SMEs account for 75 percent of employment and around 80 percent of Egyptian GDP, the impact of opening up the public procurement process, even marginally, is hard to understate.
Transparent, competitive procurement is just one of many areas where national and local governments in emerging markets need a lot of practice. For too long, procurement has been an opaque avenue to dole out personal favors rather than exercising power responsibly according to the law. It is fascinating just to think about how corporations might help governments practice open, competitive procurement procedures as part of every corporate social responsibility project. Assuming that can happen, the impact of the water projects I read about yesterday could multiply across everything that emerging market governments build. That’s a lot of building to be done.
Would you be willing to share stories or thoughts about the challenges of sourcing and contracting locally when building water infrastructure improvements or other CSR projects? CIPE and BCLC are looking for them as part of a call for articles to publish on Corporate Citizenship Trends (www.cctrends.net), a web portal for sharing perspectives on corporate citizenship, with an emphasis on the emerging market perspective. For questions and comments, or to submit proposals (articles are brief, 600-1200 words), please contact email@example.com.