Organizing for Sustainability: Networks and Partnerships

June 12, 2013

A recent survey of nearly 800 sustainability professionals in business, government, NGOs, academe, and the media in over 70 countries concluded that “experts overwhelmingly believe companies should collaborate with multiple actors, including governments, to advance sustainability most effectively.”  Yet the survey found a huge gap between the importance to companies of partnering for sustainability versus its likely adoption in practice (58% versus 30%).  Key perceived barriers to collaboration included the absence of shared goals, a lack of executive leadership, and simply a lack of experience. 

No experience to draw upon?  In the past year, we’ve participated in conferences at the University of Southern California on multi-business and business-NGO partnerships, at the Copenhagen Business School on partnerships between business-and-government, and in the Asia Forum on CSR, on multi-sector collaborations.   These were not academic conclaves.  They featured contributions from and dialogue with private-sector companies, government agencies, and NGOs from all over the world.  Our attention here turns to the growing body of scholarship and tested practice on multi-organizational collaboration for sustainability

Multi-stakeholder Partnerships

Why are companies participating in multi-stakeholder networks and partnerships?  With global challenges multiplying, the public’s expectations of business growing, and with government support retracting due to privatization and reduced budgets, it is widely recognized that the each of the three sectors-operating on their own initiative and with their own resources cannot address the full range of global challenges and unmet needs.  Complex problems call for complex solutions and organizations from different industries and sectors bring unique and essential assets to the work of social change.  Recognition of this is leading to a new configuration of sector responsibilities and, increasingly, to partnering across the sectors.  

There is, for example, a growing legion of NGOs that represent various stakeholders and operate at the nexus of business and society.  Some NGOs have acted as corporate “watchdogs” and forced companies to account for their economic, social, and environmental inaction or misdeeds. Today, however, many of them are partnering with businesses, offering technical expertise and public legitimacy to co-create social innovations.

Partnering between and among businesses is also increasing in the social-and-environmental arena.  There are, for example, multi-business initiatives regarding climate change (such as alliances for carbon trading and energy conservation), natural resources (partnerships around fish, water, and agriculture, as well as food), human rights (codes for supply-chain management and fair labor practices), as well as collaborations concerning access to medicines and, of course, education.  Motivations for businesses to work together range from self-protection to leveling the playing field to preserving natural resource stocks. But increasingly they aim at innovation. 

Starbucks, for instance, recently invited its competitors to a “Cup Summit” to explore ways to reduce waste and promote recycling of coffee cups.  Initiatives have been launched among these companies with Foodservice Packaging Association to increase the “recyclability” of cups and with waste management firms to increase volume and thereby make recycling more economically viable. 

Nike, in turn, has shared its Materials Sustainability Index with members of the Sustainable Apparel Coalition (including competitors).  This groups accounts for over 30% of the global market for clothes and footwear.  UPS has shared its carbon calculator with the Dave Matthews Band to help reduce the carbon footprint of their tours.

Why Partner?

Who does the public trust to operate in the best interests of society? On a global scale, NGOs earn far more trust than global companies in both the northern (68% versus 38%) and the southern hemispheres (63% versus 46%). All around the world NGOs are more trusted than national governments, domestic companies, trade unions, and the media.  Who is most trusted to act responsibly? In the United States, where trust in business in this regard has been relatively constant since 2001 (save for a big dip in 2008-10), trust in NGOs has increased dramatically, moving well ahead of business. NGOs are now the most trusted institution in every country except Japan and Brazil.

This is one of a few reasons why companies are partnering with NGOs to relate responsibly to society. Three more reasons are relatively straightforward:

  1. Traditions of checkbook philanthropy are giving way to the active engagement of companies in social problems. The public all over the world says that the best way for companies to make a positive contribution to society is by working to solve a specific social problem, rather than donating monies to charity. NGOs can help companies identify these specific social problems and the best ways to address them.
  2. As companies today focus on their core competencies and outsource whole functions, few dedicate extensive resources and staff to community relations and the associated fieldwork.  On this count, a study by Austin and colleagues found NGOs to be far more knowledgeable about social needs and more effective at planning social action than businesses.
  3. Finally, there is some evidence that partnering with NGOs is itself a source of legitimacy for companies in society. A GlobeScan survey found that 85% of the public reported that its respect for a company would go up if it partnered with a charity or NGO.  Furthermore, a growing segment of the public says that a key indication that a company is socially responsible is that it works directly with a charity group or NGO. 

Making Partnerships Work

There are many rosters of “best practices” in managing multi-organizational networks and partnerships—including our own research in Beyond Good Company.  Here’s a sampling of what is crucial to making partnerships work: 

  • Establish “fit” between parties in terms of mission, culture, market perspective, and commitment-to-cause 
  • Harmonize stakeholder interests and goal differences
  • Build and maintain trust among parties
  • Tailor collaboration strategies (coordination, cooperation, integration, transformation) to the partnership type and structure
  • Continually adjust messaging (internally and externally) to promote a shared mission and collective agency
  • Ensure mutual accountability and agreed-to governance mechanisms

We will develop and expand on these points in the months ahead.  Meanwhile, for those looking for a great resource on CSR/Sustainability partnerships, we recommend a new book by David Grayson and Jane Nelson, Corporate responsibility coalitions:  the past, present, and future of alliances for sustainable capitalism (Palo Alto, CA:  Stanford University Press, 2013).