Public-Private Governance

Public-Private Partnerships (PPPs) are a specialized case of multi-stakeholder governance. In PPPs, there are only two categories of Actors, but potentially there are multiple forms in which these actors may be connected.

The first ‘P’ -‘public’- narrows the actors to state institutions and/or a combination of state institutions. In a particular PPP, one might find just a municipal government; in another PPP one might find a provincial authority, a national authority, a para-statal development corporation, a school board and a ministry of finance. Each of these actors has a specific role within the traditional state structure and, in the context of a PPP, they also tend to keep their semi-autonomous roles. However it is constructed, it is the participation of the state institution that gives a political legitimacy to the PPP undertaking.

The second ‘P’ - ‘private’ - orients the concept in another way. The private category could be just one firm that wishes to have a non-traditional relationship with a state actor. Or it could be a consortium of firms in a sector, a MNC and a several local businesses, or a combination of MNCs, transnational banks, and transnational services firms. It is this component of the PPP that is expected to deliver the project in a more efficient manner than the state-institution alone or the firm or sector in a competitive marketplace. The claim for greater efficiency in delivering local public services by granting a strong role for the business sector is central to the GRI’s approach. 1

The third ‘P’ - ‘partnership’- is the most ambiguous term. It seems to suggest a legal partnership, but there are seldom formal, legally binding documents for a PPP. It resonates with the idea of a matrimonial relationship, but there is seldom any meaningful joint interaction in a PPP except at key media events. It also sounds like a reference to a governance system that is consensus-based and mutually rewarding, but is generally driven by one or two key members.

The ambiguity of ‘the partnership’ is crucial for the public acceptance of the arrangement. This ambiguity also allows non-government organizations to participate in a PPP under the public P and allows the international financial institutions (IFIs) and multilateral development Banks (MDBs) to participate in a PPP under the corporate P.     For the WEF, these PPPs are the testing ground for their multi-stakeholder governance proposals. In 1992, Prince Philip observed that 

. . . (B)usiness is uniquely well placed to take a lead and to get things done, but in partnership with local communities, governments, non-governmental organizations and other representatives of the voluntary sector. . . .  The concept of public-private partnerships has gained wider support among business and civil society stakeholders in recent years, with the Forum becoming the world’s foremost catalyst to promote PPPs.  2

The Prince’s observation is reflected in the wide array of calls for public-private partnerships in the GRI taskforces.


Related Ideas: Bribery; Carbon capture; Climate funds; EducationEmissions; Financial Risk Repository; Food redesign; Health issues; Low-carbon growth; Migration; Risk management; Water stress; Worker protection

The Readers' Guide welcomes comments with alternative examples or counter examples, supplemental assessments of the extracted GRI text or commentary – critical or otherwise – of the above interpretation of GRI’s perspective.

  1. ^ “Today, however, the pluralization of political and economic power among states and the greater weight of business, civil society and even sub-national governmental institutions implies that efforts to strengthen international cooperation will increasingly need to have a wider focus, applying … the aforementioned tools : …. In integrating non-governmental expertise into the formulation of policy frameworks, be they formal (legal) or informal (voluntary or public-private); and integrating non-governmental resources into the policy implementation.” Samans, Schwab, and Malloch-Brown introduction pg 18
  2. ^ H.R.H. The Prince of Wales, Address to the World Economic Forum Annual Meeting, Davos, 4 February 1992 The First 40 Years, pg 112
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