Ethical Performance
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Piecing together profitable partnerships

October 2015

As more and more corporates team up with environmental and social campaign groups to help drive improvements in sustainability performance, what impact is the changing landscape of partnerships having on the effectiveness of NGO campaigning and bringing companies to book for poor performance? Tom Idle reports

It’s no time to be working for a non-governmental organisation (NGO) in central Asia. Described as “battering rams” by government officials, China is considering new laws to restrict just what independent organisations can get away with, recently detaining five women for more than a month for campaigning against sexual harassment.

In Cambodia, the state says it must handcuff any NGO workers that cause political trouble. A new law in Indonesia has set tight restrictions on NGOs to deter them from “disrupting the stability and integrity” of the country. And only three months ago, officials in Pakistan shut down the local Save the Children offices, accusing its aid workers of being spies.

While NGO-aversion is widespread in the East, the same can’t be said for what’s happening here in the West, particularly within the business community. Possessing levels of trust that most companies could only dream of, more and more organisations are keen to cosy-up to NGOs, rather than tread in fear of them, in a bid to leverage some of their charm. According to the latest Corporate-NGO Partnerships Barometer, enhancing brand and improving credibility remain the primary motives for companies wanting to get into bed with NGOs. While, for most NGOs (98%), getting access to significant cash resources remains the number one reason to partner with a corporate.

Of course, NGOs have long played a key role in pushing the sustainable development agenda at an international level, with campaign groups acting as key cogs in the wheels of inter-governmental negotiations. Whether it is bringing into force a ban on CFCs or the elimination of slavery – NGOs have been a driving force in bringing about positive environmental and social change in the world.
But facing a retreat by many governments favouring an anti-regulation agenda, NGOs have slowly but surely targeted powerful corporations, some of which dwarf entire nations in terms of their buying power, influence and resources.

Yet, they continue to bring companies to book for poor performance. Only recently, Forest Heroes got creative to force palm oil producer Astra Agro Lestari to take action on forest clearances across Indonesia. The business, the parent company of luxury hotel chain Mandarin Oriental, was targeted by a series of mocking video ads. Playing on the hotel company’s ‘She’s a fan’ slogan and TV spots, regularly backed by celebrities like Kevin Spacey, it created the slogan ‘She’s not a fan’ and splashed images of endangered Sumatran elephants all over the ads – one of the popular animals it claims are being threatened by the loss of habitat associated with Astra Agro Lestari’s expansion of palm oil plantations. The campaign also featured video footage captured by drones revealing some of the evidence that Forest Heroes claims supports its assessment that Astra Agro has cleared some 14,000 hectares of forest since 2007 and cleared 27,000 hectares of peatland in Indonesia.

Meanwhile, the corporate-NGO partnerships we know and love – such as the Sky-WWF team which gave birth to the Sky Rainforest Rescue initiative, or the Marks & Spencer-Oxfam partnership which has popularised ‘Shwopping’ – continue to create mutual value for both parties.

But a new type of relationship has also been emerging – one which sees the traditional protagonists get a lot closer to the so-called ‘enemy’. This new form of partnership, sometimes involving a consortia of players, is a sign that the responsible business agenda is maturing, according to Manny Amadi, chief executive of C&E Advisory, which runs the Corporate-NGO Partnerships Barometer. As companies and NGOs work together to tackle an array of common sustainability challenges, from tackling climate change, to addressing health issues such as obesity, “both parties are recognising the greater reach, impact and value provided by this model of partnering,” he says.

It is in dealing with supply chain issues that these new relationships seem to be gaining most traction. Despite best intentions, big companies with long, complex and wieldy supply bases are failing to trace raw materials and commodities effectively, and have little knowledge whether their products and services are fuelling modern day slavery or deforestation, for example. With a lack of oversight, or presence on the ground, they have realised that NGOs can unlock some of the complexities involved in working with dispersed suppliers, particularly in the developing world.

In early 2013, Greenpeace announced that it would suspend active campaigning against the world’s third largest paper and packaging business Asia Pulp & Paper (APP), after three years of continuous protest against the business for blindly chopping down trees across Indonesia, home to endangered tigers and orang-utans.

In a clear response to the aggressive Greenpeace campaign – which saw it target high-profile APP customers, such as the toy company Mattel and the fast-food chain KFC, urging them to stop buying products packaged in APP’s materials – the paper business released a new Forest Conservation Policy (FCP). It promised an immediate moratorium on any further forest clearance by all of its Indonesian suppliers, as well as a pledge that independent assessments would be conducted to establish areas for protection. It was a big success for Greenpeace and APP’s move was described by environmentalist Tory MP and wannabe London Mayor successor Zac Goldsmith as the “most dramatic turnaround of any global green villain ever seen”.

And it also kick-started a willingness from APP to be more open and transparent about both the challenges it faces and how well it is overcoming them. Now in constructive dialogue with Greenpeace, rather than cowering under attack, the business invited another NGO, the Rainforest Alliance (RA), to independently assess how well it was meeting its new FCP one year on.

Earlier this year, the RA reported its findings, which while not entirely glowing (the company was found to still be failing to stop deforestation and illegal activities in its concessions) it did boost its credibility, drawing many plaudits for its transparency.

Similarly, the chocolate and coffee company Nestlé decided to team up with The Forest Trust (TFT) to ensure its sourcing of palm oil was not contributing to illegal rainforest and peatland clearance – a direct response to another Greenpeace campaign attacking the company’s connections with the Indonesian palm oil producer, Sinar Mas, which had been accused of illegal deforestation.

TFT – which has also worked with Kingfisher and Marks & Spencer to improve the procurement of wood from sustainable sources – will visit plantations and verify that Nestlé’s suppliers are meeting a set of agreed palm oil-sourcing guidelines. It is a partnership that the TFT’s executive director Scott Poynton says “sends a message to the industry that segregated palm oil – that is to say factories that only deal with certified palm oil – is the way forward”.

These types of partnerships, with a clear purpose and an ability to create positive impact at scale, are likely to stand the test of time. By opening up and inviting independent scrutiny, these businesses can ill-afford to mess up.

Similarly, by adopting a more seemingly friendly approach, the NGOs in question are putting their own reputations on the line too.
The importance of partnerships will only grow, according to the C&E data, with pressure on business to demonstrate societal consideration (85%), and a desire for both business and NGO to leverage each other’s assets (80%) being the key drivers for more partnerships to emerge.

Clearly, given the structural and cultural differences of both parties, getting NGO-corporate partnerships to be effective and valuable has its challenges, not least in finding and agreeing on common goals and building trust. But the benefits of teaming up for the common good “are likely to outweigh their inherent challenges,” says Amadi. However, he warns that the perceived value of becoming bedfellows with an organisation seen traditionally as being on ‘the other side’ will only be truly realised “through effective planning and skilful navigation of real and often substantive challenges”. 

Global | Partnerships


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