The private sector has tremendous influence in today’s world. Businesses have the power to both contribute to the creation of a fairer world, or undermine it; exploiting the poor and vulnerable, and destroying the environment.
Oxfam believes that inclusive, sustainable, and fair market development requires a responsive private sector as much as an effective national and local government. Our interventions aim to maximise the contribution that business can make towards poverty reduction by challenging some practices, and building a model for ethical trade that is both better for business, and better for the planet.
Working with the private sector can be a complex process.
Once you’ve identified the companies you want to work with by using the market mapping and power analysis tools, this section will help you to initiate the partnership; clarify the terms, and analyse any potential risks. This guide is primarily for developing partnerships with the private sector.
For more on how to engage for advocacy or influencing public policy see the influencing pages.
Average time investment for using this toolThis depends on your context, and who you’re trying to engage with. It is a long-term process that requires constant attention.
Who leadsProject Manager
Who needs to be involved
Project team, partners, smallholders and other stakeholders as necessary
Activity 1: Managing riskIdentify and mitigate potential risks of working with your chosen company.
Step 1: Assessing risk
Working with the private sector can present new risks to your programme, and to your organisation. The risk template to the right of this page lists the most common types of risks to consider when managing these partnerships.
Use the consequence/probability framework in the template document to assess the level of risk for each, and work with your partners to determine your risk management strategy.
Step 2: Ethical screening
The following is specific to Oxfam only. Check with your own organisation for what procedure they have in place.
An ethical screening ensures that you only work with organisations that do not compromise your own organisation’s aims and values.
If your target company operates only in your chosen region, follow regional/country processes for getting ethical clearance.
If your company is international, Oxfam partners will need to complete an ethical check form for sign off at global Oxfam level. The questions on the form may also prove useful to non-Oxfam partners. You can download an ethical check form to the right of this page.
Check for existing ethical screens on your company on the Corporate Contacts Database. These can be used for new interactions within 12 months of the date the screen was completed. Otherwise they should be updated.
Step 3: Share your risk analysis and ethical screening
Share a copy of the risk analysis and/or ethical screening with your country director, and ensure they agree with the conclusions.
Share your screen with the Corporate Contacts Database (CCD).
Step 4: Monitor and update
As your project goes on, the situation may change. Be aware that you may need to refresh your ethical screen or risk analysis.
Activity 2: Initiating a partnershipTips on establishing a successful partnership.
Step 1: Establishing first contact
The most appropriate way to engage with the private sector for partnership will be different for each country, and each situation.
Other teams have found it useful to:
- Ask colleagues for existing relationships with companies (Oxfam staff can also check the SUMUS Corporate Contacts database)
- Go through other contacts (Check with your broader contacts, or your LinkedIn community for opportunities to connect you)
- Attend key conferences that companies attend (these could be CSR or more traditional industry events)
- Contact the sector association (they may be able to connect you with interested partners)
This section outlines one of the ways in which partnerships can develop. There are also many other ways, such as a company approaches the NGO and suggests a collaboration; or the NGO already knows the company and they jointly decide to do something etc.
Step 2: What's the hook?
By now, we know our motivations and we know the benefit to the producers. We’re convinced that this is the partnership we want to explore further, but is our target company convinced?
You will need to find a hook to engage private sector interest. This is best done by working out how the business will benefit, and explaining that clearly to them in terms they will appreciate.
They will likely be driven by different fears and ambitions than the NGO sector, and it may help to appeal to these.
For example: “Empowering 50 women to take greater control of their income” may not resonate with all companies; it may be better to focus on demonstrating how this may increase the product’s reliability and quality instead.
Does the business want to improve its brand name? Does it want to improve product quality? Does it want to reduce cost by sourcing more locally? etc.
Find out, and determine how this partnership could help them to achieve their goal.
REMEMBER: There are a lot of benefits businesses can gain from engaging with smallholders, but don’t over-promise. Ensure opportunities for businesses are grounded in evidence and fact.
Step 3: The business case for the partnership
Giving a company ideas for the business case of a partnership can be the most effective way of convincing them to buy into the idea.
Prepare your plan before meeting with your chosen company.
Your plan can address the following points:
- Show off your unique selling points. What makes your project different?
- Show sustainability, scalability and competitiveness.
- Show that it meets customer needs and addresses real demands.
- Show profitability.
- Reputational benefits
Step 4: The pitch
At some point during the early stages of developing the relationship with the company-partner, you may be asked to present/pitch the idea to a larger team within the company. This meeting can be crucial for generating the necessary buy in and support for your idea.
Using your hook, and your business case, prepare a pitch that includes:
- Your vision and ideas on the shape of the engagement opportunity
- The business case for the company
- Key stakeholders for the engagement
Tips for a good meeting
- Do your research: a good understanding of their business will earn their respect
- Do presume a lack of trust
- Do be diplomatic: their objectives and working style may be different to yours
- Do be adaptable: watch their body language
- Do invest in building personal rapport and relationships
- Do be honest and believable
- The people you speak to may not be making the final decision. Make it easy for them to share with their board.
- Summarise the meeting and highlight the next steps
- Don’t expect your audience to be familiar with your organisation, or your expertise
- Don’t over represent your organisation: it’s a partnership, not a dictatorship
- Don’t criticise their business model, products or services
- Don’t be disappointed if the first meeting doesn’t go well. This is common! Just be ready to handle the situation diplomatically.
Step 5: Prepare your beneficiaries
Remember that Oxfam’s role is to facilitate and broker relationships, not to drive them.
Ensure your beneficiaries understand how large organisations may work, and that they have the skills to work with them. This doesn’t mean you should stay silent and let them do all the work though!
REMEMBER: We only have two things to sell – programmes and knowledge. We never sell products on behalf of producers.
Activity 3: Setting the termsAgreeing on appropriate terms and writing an MoU.
Step 1: Determine the roles
Use the following diagram to determine what your organisation’s role can be in the partnership.Often, an inclusive business model will require input in all four areas. However, your company cannot always play all roles. In these instances it may be necessary for other roles to be filled by other actors. Discuss and agree this in advance.
Step 2: Define terms
Discuss terms with the company and other actors, guided by the checklist in step three below.
There are many aspects to agreeing a partnership, and most are negotiable. However, there are some terms that your organization might want to consider not negotiating on:
– It can be problematic to agree to partner exclusively with one company in that sector. Partnership is not a commercial arrangement. Your organization may wish to keep the discretion to engage with other companies if that would be more impactful.
– If your organization is involved in advocacy and campaigning, they may wish to maintain their right to keep campaigning on issues the company engages with.
For companies, the key term that they will want to include is:
– Companies will want to ensure that your organisation keeps confidential any commercially sensitive information that they share (strategies, costs, etc.). They will often ask for confidentiality or non-disclosure agreements (NDAs). You need to assess how reasonable this is in your context.
Step 3: Write up your MoU
The following checklist gives guidance on what should be discussed and decided upon with your chosen company when writing up your agreements:
- The objectives for the cooperation;
- Initial actions and interim accomplishments that are essential to the cooperation;
- Clear details of how the achievement of targets, and initial and interim activities will be measured and evaluated.
- Clarity about which failed accomplishments constitute grounds for disengagement;
- Details of the rights of both parties to end the arrangement and the circumstances under which disengagement can happen;
- The limit of time and resources allotted to the cooperation;
- The right for automatic cancellation and disengagement on the part of Oxfam when the conduct of the company could damage Oxfam’s reputation.
- Details on how the Oxfam name and logo should be used in all forms of company interaction.
Where the relationship is a complex one, the agreement should contain details of:
- Notice period for disengagement;
- Procedures for closing down the joint activities;
- Deadlines for removal of publicity material about the relationship and any corrective publicity;
- The division of any assets related to the relationship.
Ensure that all parties are clear on the terminology used.