ON CURRENT TRENDS, sub-Saharan Africa will not meet any of the Millennium Development Goals by 2015. That is why the UK Government has made Africa one of its two priorities for its G8 and EU presidencies this year, along with climate change. The Commission for Africa, established by the Prime Minister in February last year to inform this agenda, published its Report, Our Common Interest, on 11 March. The Commission’s Report sets out a coherent set of policies to accelerate progress towards a strong and prosperous Africa. It will inform the agenda for several meetings taking place this year, starting with the G8 Summit in July, but “I have said on many occasions that I believe including also the UN Millennium Review Summit in September and the tremendously important Africa is the scar on the conscience of the world, WTO Ministerial in Hong Kong in December. Its and I think it is right to treat this as an absolute findings are likely to remain influential in terms of the international agenda for African development priority over the coming years.” for years to come. UK Prime Minister Tony Blair in launching the Commission for Africa in The Commission consists of 17 Commissioners, February 2004 the majority of whom are African, including three Building a strong and prosperous Africa The role of business MYLES WICKSTEAD

4 OPTIMA JUNE 2005 individuals actively engaged in business; and a as Mozambique in the south, Benin in the west small Secretariat based in London. Over the and Uganda in the east. However, the Commission course of the past year, the Commission has argues that Africa needs to significantly accelerate consulted across a wide spectrum of stakeholders, and sustain growth across the continent to make including several events targeting the private serious inroads into poverty. sector. Around 30 international businesses have been actively involved in a Business Contact The value of partnerships Group set up by Chancellor Gordon Brown and To achieve this requires a partnership between Niall Fitzgerald, the then chairman of Unilever, Africa and the developed world, which takes full to inform the work of the Commission; over account of Africa’s diversity and particular 100 small and large businesses participated in circumstances. This partnership involves Africa a Chatham House conference; and a series of accelerating reform while, for its part, the regional business roundtables were held in developed world increases and improves its aid South Africa, Algeria, Cameroon, Tanzania and and refrains from doing those things that hinder Ghana, involving 120 business leaders from Africa’s progress. It also involves a central role 19 countries. for the private sector in driving growth, but with In its Report, the Commission recognises the governments having a key role in creating the improvements seen in Africa in recent years, right environment. It is not a question of the both in governance and in economic growth. For state versus the private sector, but how they example, two-thirds of African countries have work together. The Report makes a strong case held multi-party elections in the last five years. that a real opportunity exists at this moment for Over the last decade, 16 sub-Saharan Africa greater external support for Africa’s efforts from countries have seen average growth rates above the international community to have a real and 4%, including 10 with rates above 5% and three lasting impact. with rates above 7%. There are examples of In their analysis, Commissioners highlight strong performers from across the region – such the way in which the various causes for Africa’s underdevelopment (political, structural, human and environmental) interact, often in complex Growth in sub-Saharan Africa interlocking cycles: for example, there can be no Real GDP growth average development without peace and security; at the (1993-2002) same time, development which reduces poverty and inequality is a prerequisite for maintaining peace and security. Equally, a weak and poorly educated workforce cannot contribute to strong economic growth, but strong growth is needed to generate the funds to invest in health and education. To address these often vicious circles requires a comprehensive ‘big push’ on many 7.0% or higher 6.0% to 6.9% fronts at once. 5.0% to 5.9% Based on this analysis, the Commission 4.0% to 4.9% suggests a package of measures, structured 3.0% to 3.9% around a number of key themes. Governance 2.0% to 2.9% 1.0% to 1.9% and peace and security are at the heart of the Less than 1.0% proposals – without good governance and without No data peace and stability, other measures have little scope for success.

Source: World Bank OPTIMA JUNE 2005 5 There is a strong raft of measures for investing It is important to ensure that Africa’s in people, and generating growth and poverty development not only generates benefits for poor reduction. This will require a major increase in people, but that it is sustainable – broadly meeting resources – the Commission proposes that aid to the needs of the present without compromising Africa should increase immediately by $25 billion the ability of future generations to meet their own per annum, followed by a further $25 billion per needs. To achieve this, it is necessary to address annum increase in five years after a review of all three pillars of sustainable development: progress – and up to 100% debt cancellation for economic, social and environmental. all low-income African countries. The Report highlights the generation of economic People, planet, prosperity growth as the private sector’s primary contribution The Commission recognises that sustainable to poverty reduction: growth creates jobs and economic growth requires prudent use of natural economic opportunities that lift people out of resources and effective protection of the environ- poverty, as well as tax revenues needed to fund ment. A key challenge is to ensure this is public spending on a long-term basis. However, addressed in the face of rapid urbanisation: well- MEN BEHIND THE it is increasingly recognised that the way larger planned cities offer much-enhanced opportunities COMMISSION: British foreign and domestic businesses do business can for environmental sustainability. Sustainable Prime Minister Tony Blair and Chancellor of the also have a powerful impact on the extent to environmental management requires a holistic Exchequer Gordon which poor people are able to participate in and assessment of what resources a country has and Brown, who is one of the Commissioners benefit from growth. how these natural resources could contribute to

© GETTY IMAGES/TOUCHLINE PHOTO poverty reduction. It also requires improved The challenge now is environmental governance, through transparent and participatory institutions and processes that implementation. And this will genuinely involve those affected by change. This require partnerships between is required at local, national and regional levels. The impact of business on the societies in businesses and government, which they operate is often discussed in the between businesses and civil context of ‘Corporate Social Responsibility’ (CSR). society and between However, the Commission argues that the vagueness of the term and its overly narrow businesses themselves interpretation as ‘corporate philanthropy’ means that some of the most important business-poverty linkages are often missed. While philanthropy does of jobs, businesses’ commitment to core have very real benefits, still more important is the labour standards can contribute to poverty impact businesses have on development outcomes reduction by promoting broad-based economic through their core business activities. The Report and social development; highlights four areas of particular importance:
Enterprise Developing long-term business
Employment Job creation is clearly a central relationships with micro, small and medium way in which businesses can be of direct enterprises is one of the most important ways benefit to society. In addition to the quantity in which larger companies can promote the

© GETTY IMAGES/TOUCHLINE PHOTO participation of poor people in growth. This is other show. Among many recommendations a focus of the Africa Enterprise Challenge Fund aimed at improving governance, the Commission proposed by the Commission; encourages all resource-rich African countries to
Goods Goods and services for poor people are implement the Extractive Industries Transparency often relatively expensive and of poor quality. Initiative (EITI), and to expand transparency and A greater choice of lower-cost goods can accountability principles to other sectors, including benefit poor people, particularly if they are forestry and fisheries. tailored to their needs. Better management The Report lists a number of factors that can of the environmental impact of goods and limit the potential of business activities to services is also important; and, provide opportunities and benefits for poor
Social services Paying taxes and refraining people. These include, firstly, a proliferation of from demands for special tax treatment codes and guidelines for corporate responsibility, strengthens the government revenues needed which can obscure comparability and accountability for sustainable, long-term provision of public and encourage a ‘boxticking’, process-driven, services. Businesses can also directly benefit rather than outcome-driven, approach. Secondly, employees (and their families), through the a lack of co-ordination and alignment with provision of education, housing and health national development priorities can undermine the services, with HIV and AIDS programmes effectiveness of businesses’ efforts. Impacts can particularly important. Business can also play be much larger if businesses act together and in an important role in promoting transparency support of national initiatives – a point made and good governance. during the Commission’s business consultations. Revenue transparency is particularly important Thirdly, current approaches take inadequate in the extractive sectors, as the very different account of developing-country perspectives: development experiences of resource-rich countries Prescriptive codes – reflecting concerns of like Botswana on the one hand and Angola on the developed country stakeholders – can have unintended consequences on small-scale suppliers, excluding them from market opportunities if they Life expectancy in developing countries are inappropriate or costly. Nevertheless, there are already numerous good

80 examples of effective action. The International Business Leaders Forum has developed a useful framework for co-ordinating business actions in

70 support of the Millennium Development Goals and is in the process of rolling this out across Africa. The Global Business Coalition on HIV and AIDS 60 brings together 180 international companies to promote best-practice company anti-AIDS programmes in the workplace and communities, 50 and to influence public policy. Many others, Life expectancy at birth (years) birth at Life expectancy including the Business for Social Responsibility movement and the World Business Council for 40 1965 1970 1975 1980 1985 1990 1995 2000 2005 Sustainable Development, are leading the way in

Sub-Saharan Africa East Asia and Pacific business engagement in development issues. South Asia Latin America and Caribbean Individual companies, including members of Middle East and North Africa the Commission for Africa Business Contact Source: World Bank, 2004 Group, are pioneering innovative ways of working

8 OPTIMA JUNE 2005 in Africa. In its recommendations for the private investment projects, and is currently active in sector, the Commission calls for a sea change in Tanzania, Madagascar and Ethiopia. Investments the way the business community, both domestic range from rural telecommunications and rural and international, engages in the development electrification to agribusiness and ecotourism. process in Africa. Businesses must sign up to GSB activities – including brokerage, up-front leading codes of good social and environmental feasibility and technical studies – are designed conduct, including on corruption and transparency, to improve the supply of bankable, pro-poor and focus their efforts on co-ordinated action to investment projects. tackle poverty. The Commission calls on developed countries The Commission calls on the business to provide US$20 million over five years in support community to identify actions it can take in of the GSB. This level of funding will enable the support of the priority actions set out in its GSB to broker over 100 investments, worth over Report. Five areas for action are set out in its $300 million, across 20 African countries and “Messages for Business” leaflet, and proposals across a range of sectors, such as infrastructure, to take action on these under a banner “Business financial services and agriculture. Action for Africa” were put forward at a recent The Commission also urges greater participation business conference. These include: of African countries – and their private sectors,
Advocacy in support of African development including small enterprises, and civil societies – in Engagement with the G8 on trade and aid, and the global CSR debate, including in the context of national governments on good governance, the next review of the OECD Guidelines. Specifically, investment climates and policies that help it calls for financial support for initiatives such as poor people; the recently launched Africa Corporate Sustainability
Telling the positive stories Help tackle the Forum, and measures to enable small-scale suppliers negative images of Africa by promoting to meet international codes and standards. successful investment stories; For their part, donors and African governments
Behaving responsibly Sign up to leading codes must develop more effective partnerships with the of good social and environmental conduct, private sector. The Commission also heard during including on transparency and corruption; its consultations with African businesses that
Making a difference Move beyond a focus private-sector firms of developed countries should on philanthropy to look at impacts of core build partnerships with their African counterparts business activities – support small enterprises; in areas of standards to raise the quality of promote fair working conditions; develop new African export commodities. products and services that meet the needs of The Commission sees a key role for the poor people; support public- and private-sector private sector. It has listened to and reflected capacity development in Africa; tackle youth some of its key priorities: creating a fairer unemployment; and, international trading environment for Africa;
THE AUTHOR Joining forces By working together in support investing in infrastructure; promoting better Myles Wickstead is head of national initiatives, businesses can increase investment climates; supporting African-led of secretariat to the Commission for Africa. their impact, such as on HIV and AIDS. processes towards spreading good governance; and taking steps to unleash and support the ACKNOWLEDGEMENT This article first appeared in Business investing in success entrepreneurial energy of Africa’s people – the Summer 2005 edition The Commission singles out the UNDP Growing from small farms to larger firms. of Sustainable Development Sustainable Business initiative (GSB) for The challenge now is implementation. And this International, Issue 14. Reproduced with kind particular support. This initiative brokers will require partnerships between businesses and permission of Henley partnerships that enable foreign and domestic government, between businesses and civil Media Group, www.henleymediagroup.com companies to engage in pro-poor and sustainable society, and between businesses themselves.

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