Best Practice Report

Index

1. Introduction

As noted by Ban Ki-moon, UN Secretary General, at Rio+20, achieving sustainable development and green growth requires an “extraordinary mobilization […] of corporate leaders, civil society groups, ordinary citizens and others clamoring for change” (United Nations, 2012). This chapter analyzes how public private collaboration (PPC) can achieve such broad mobilization in achieving green growth objectives; and
what PPC approaches have been most successful in mobilizing private sector leadership and action.

The case for collaboration is that it “creates synergies between governments and private participants, allowing them together to produce more than the sum of what their separate efforts would yield” (Donahue and Zeckhauser, 2011). However, PPCs may not always be successful or the best solution and should be carefully designed. Collaborative initiatives often seek to overcome specific barriers that impede partners’ from achieving their goals. In particular, with increasing resource constraints, governments and business look for support from other stakeholders to overcome barriers such as lack of information, capital, technologies, and skills (3GF, 2012). A PPC may also be specifically driven by the cost-savings potential of contracting private entities to perform tasks at lower costs than the public sector.

This chapter explores how PPC can support green growth, and the lessons and success factors in practice. Studies on green growth (World Bank, 2012; Baietti, 2013; and World Bank and PPIAF, 2012) highlight a number of possible areas where collaboration can support green growth, including innovation, natural resource management, green and climate resilient infrastructure, resource efficiency and productivity, and transparency and disclosure such as green accounting metrics, labels, reporting protocols or standards. This chapter explores three of these areas:

  1. Spurring innovation and creating markets (section 2) – including mostly public discretion (e.g. Research and development (R&D) innovation stage) and mostly private discretion (e.g. commercialization innovation stage).
  2. Managing natural resources (section 3) – where collaborations tend to be in the form of shared discretion (e.g. natural resource management schemes). 
  3. Development of green growth supporting infrastructure (section 4) – including both public and private discretion collaborations (e.g. information technology in the agricultural sector).

In addition to these three areas, enhancing resource efficiency and productivity and enhanced transparency and disclosure are also important areas for green growth extensively explored in other studies. However, due to space and resource limitations, PPCs in these areas are not addressed in this chapter.  

Cases examined in this chapter include:

 

What do we mean by public-private collaboration?

Relationships between government and the private sector can range from economy-wide government policies that set the framework for private investments to project-specific engagements. For the purpose of this chapter, three archetypes of collaboration are considered:

  • Mostly public discretion (government control and contract for service). These are usually termed ’public-private partnerships’ (PPPs) and are characterized by contracts and sharing of risks between public and private entities whereby companies design, build, finance, operate, and/or maintain assets or services traditionally provided by government (IMF, 2007; De Vries and Yehoue, 2013; and OECD, 2008). They are most useful when the desired outcome has been identified by government and can be clearly defined in contractual terms. One example is the delivery of state and local wastewater treatment services by private sector actors under contract with US municipalities (Bhan, 2013).
  • Shared discretion (‘collaborative governance’ with joint decision making). This can be effectively applied when a problem requires broader engagement to coordinate and negotiate actions. For example, Sacramento county officials initiated the Sacramento Transportation and Air Quality Collaborative with participation of 48 public and private sector organizations to jointly assess problems, negotiate solutions, and to implement policies (Henton and Melville, n.d.).
  • Mostly private discretion (scaling-up private leadership through government support). In this situation, businesses and government interaction is at arm’s length through enabling regulations and policies that support business to mobilize resources, skills, innovation, and entrepreneurship. For instance, development of electric vehicles is primarily occurring through private sector leadership, however, government has provided some R&D and infrastructure support (Volans Ventures, 2013).

Figure 2 illustrates how these three archetypes are characterized by different degrees of business and government discretion.

 

Figure 2:
Forms of public-private collaboration