Seeking Solutions Across Sectors

NGOs Seek Solutions Across Sectors

By BizEd Staff

December 20, 2016

The sustainable benefits of collaborations among NGOs, buyers, and sellers.

WITH SO MANY PEOPLE in the world living in poverty, conflict zones, or both, more researchers are examining how the involvement of business could help improve their plight. Two recent papers—one on supply chains, one on the Syrian refugee crisis—focus on how cross-sector partnerships could provide much-needed solutions:

NGOs and the sustainable supply chain. Academics often don’t consider how nongovernmental organizations (NGOs) help make for-profit supply chains more sustainable. That's why a recent paper examines NGOs’ collaborations with emerging-economy suppliers and for-profit buyers. Its authors find that NGOs’ “nontraditional” activities in the supply chain help alleviate poverty and mitigate environmental hazards such as excessive pesticide use in farming.

The co-authors include Jorge Rodríguez, assistant professor of supply chain management at Escuela Superior Politécnica del Litoral (ESPOL) in Guayaquil, Ecuador; Cristina Giménez Thomsen, professor of operations, innovation, and data sciences, and Daniel Arenas Vives, associate professor of social sciences, both of ESADE in Barcelona, Spain; and Mark Pagell, professor of sustainable supply chain management at University College Dublin in Ireland.

The team cites examples such as the Rainforest Alliance, which has trained small suppliers to work with larger firms, and Solidaridad, which has helped farmers become certified to work within agricultural supply chains. That training has “resulted in reductions in child labor and improvements in poor producers’ profits and women’s access to labor opportunities,” the authors write. “NGOs are often better placed than for-profits to address many issues of social sustainability and we know that they manage their supply chains to do so. What motivates this study is how little we know about these phenomena.”

The team looks specifically at a multinational NGO operating in Latin America, Africa, and Asia. This NGO, focused on poverty alleviation, had begun its first implementation of private sector initiatives. The researchers’ final sample included six of the NGO’s supplier development initiatives in Ecuador, about which they collected data from December 2011 to July 2013. During this time, the NGO visited potential suppliers—who worked in areas such as farming, carpentry, and metal scrap collecting—to learn their biggest challenges. It designed training programs to help them adopt best practices and improve efficiency, and it facilitated their relationships with buying firms. The NGO acted as a “bridge” between suppliers and buyers to ensure that practices improved suppliers’ livelihoods and protected workers and the environment.

“This bridging capability reduced the buying firms’ transaction costs when dealing with poor suppliers," the authors write. They conclude that NGOs play invaluable roles in building sustainable supply chains without economic tradeoffs. They suggest that buying firms seek out NGOs’ expertise in adapting to local markets and invest in helping poor suppliers integrate into the supply chain.

The authors suggest several paths for future research, including studies that determine what happens to suppliers after an NGO initiative ends. “It is unknown,” the authors write, “whether poor suppliers are better off under long-term relationships with the buying firm or whether their new capabilities would be better off in the market.”

“NGOs’ Initiatives to Enhance Social Sustainability in the Supply Chain: Poverty Alleviation Through Supplier Development Programs” appeared in the July 2016 issue of the Journal of Supply Chain Management.

Cooperation and the refugee crisis.

The conflict in Syria has forced 4.5 million Syrians to seek refuge in neighboring countries, leaving governments scrambling to address the social, economic, and political strain of sustaining growing refugee populations. So far, few workable strategies have emerged from state actors. However, a working paper argues that partnerships among the private sector and NGOs might be the key.

Author Derya Büyüktanir, an assistant professor of international relationships in the School of Social Sciences at Abdullah Gül University in Kayseri, Turkey, first points to successful collaborative multistakeholder initiatives (MSIs). These include the United Nations Global Compact, which aims to achieve the U.N.’s Millennium Development Goals. She then turns to private sector involvement in a specific pressing issue: the Syrian refugee crisis.

In the early years of the crisis, Büyüktanir writes, private sector involvement was minimal. Instead, government agencies and individual NGOs such as Doctors Without Borders tried to manage the crisis, but their efforts were largely ineffective. However, starting in 2014, local companies and multinational corporations “began working with governments, [intergovernmental organizations], and NGOs to decrease the short-term and long-term consequences of massive refugee flows.”

Since then, the number of these MSIs has been increasing. For instance, a partnership between NGOs Oxfam and UNICEF helped supply more than 85,000 people in Lebanon with clean drinking water and supplies. NetHope and Microsoft partnered to create technology centers for refugees in Jordan, Turkey, and Lebanon, where they could access the internet and learn technology skills.

Even so, more MSIs are sorely needed “to inspire others to act proactively,” Büyüktanir argues. “The private sector … is still not taking active roles in both leading and funding multi-sectoral initiatives by using more innovative solutions.”

She calls for more research into best practices when it comes to forming strong alliances among private sector companies, governments, and NGOs. “The private sector,” she writes, “can significantly address humanitarian needs and solve problems by using its knowhow, resources, and innovative methods with the cooperation of other partners, and improve their own standing and global economics in the process.”

Büyüktanir presented “Increasing Multi-stakeholder Initiatives and Cooperation in the Private Sector: The Case of the Syrian Refugee Crisis” at the Maastricht School of Management’s sixth annual research conference in the Netherlands last September. The working paper is available for download at ideas.repec.org/p/msm/wpaper/2016-2.2.html.

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