7 May 2018
SDG Knowledge Weekly: Supply Chains and Public-Private Partnerships
Photo Credit: Lynn Wagner
story highlights

A research article in Sustainability explores the extent to which the SDGs provide a basis for supply chain decisions in the construction sector.

The UN Economic Commission for Europe released a draft two-part report on Guiding Principles on "people first" public-private partnerships for the SDGs.

New platforms were launched around SDG statistics and development cooperation.

The last SDG Knowledge Weekly brief made quick reference to agricultural supply chains. However, supply chain management can facilitate significant progress on both the climate and development agendas. This week’s brief takes a deeper look at sectoral supply chains to explore their potential to contribute to the SDGs, as well as public-private partnerships (PPPs) and means of measuring progress.

Supply chains span the breadth of the 2030 Agenda, affecting issues ranging from decent jobs (SDG 8) to climate action (SDG 13) to responsible production and consumption (SDG 12) to life on land and deforestation (SDG 15). A research article published in Sustainability asks whether the SDGs can “provide a basis for supply chain decisions in the construction sector.” The authors, from the University of Surrey, focus primarily on SDG 12, and review two contrasting approaches to increase supply chains’ sustainability. The first is a bottom-up approach, or third-party monitoring, as exemplified by the Forest Stewardship Council in sustainable timber certification. The second is a top-down model, typified by regulations and legislation such as the UK Modern Slavery Act. The article finds that, for ensuring sustainable consumption and production, third-party monitoring is more effective than standards imposed through legislation.

The business and environmental impact opportunities to be found in streamlined and efficient supply chains appear to be quite large, as the Sustainability article notes that 10-30% of the construction industry’s 380 million tonnes of resources procured annually are wasted. A 2016 report by Corporate Citizenship and the Business & Sustainable Development Commission reviews business opportunities by sector, one of which is the construction industry. However, the above article claims that: the SDGs offer little guidance on how to capture these opportunities; the SDGs do not challenge an incremental approach; and the business-focused targets and indicators – which are few – look only at the reporting process, rather than outcomes. While the authors acknowledge the SDGs’ success in raising broad awareness on sustainability, they ultimately contest the assertion that the Goals are transformative given the complexities of global supply chains and the need to provide industries with “a practical decision-making framework.”

Embedding sustainability into supply chains also calls for a more collaborative business model, and may benefit from a “playbook,” Sue Lubeck writes on GreenBiz. As the Sustainability article highlights, “design, build, operate” models are becoming common in public-private partnerships (PPPs), which are playing increasingly significant roles in the fulfillment of major contracts. A document transmitted to the UN Economic Commission for Europe (UNECE) from the Expert Team, Infrastructure, Concessions – Public-Private Partnerships (ETIC-PPP) adds nuance to this. The ETIC-PPP is an independent association based in Paris, France, working in the partnerships space. Their note sets out a definition of a “People First PPP,” and distinguishes contracted services, or traditional public procurement, from those where the private sector is paid only upon satisfactory delivery of a service over time.

UNECE is hosting the International Forum on people-first PPPs for the SDGs from 7-9 May 2018, in Geneva, Switzerland. In support of the Forum, UNECE published a report in two parts on ‘Guiding Principles on People-First Public-Private Partnerships for the SDGs.’ These principles build on prior guidance and events, such as UNECE’s 2008 Guidelines on Good Governance in PPPs and the UNECE-hosted PPP Forum held in March 2016. They could potentially form the basis of a playbook, as envisioned by Sue Lubeck.

Part I of the guiding principles report introduces people-first PPPs as a solution to SDG implementation. It also summarizes some of the mixed reception to PPPs. Critics have noted that the PPP model is not “fit for purpose,” that it delegates key public responsibilities to the private sector and civil society, and that it introduces a dangerous profit motive into public services, among other issues. It also describes PPPs’ evolution in the water and sanitation, energy, health and transport sectors, and outlines common areas for improvement in terms of capacity building, risk, innovation and the broader project environment.

Part II describes eight guiding principles for people-first PPPs. The principles cover project plans, capacity building, legal frameworks, transparency and accountability, risk, procurement, resilience and climate change, and innovative financing. For each, the report addresses challenges, risks, SDGs impacted, and where applicable, myths address or recommended government actions. According to the document, the eight principles will enable people-first PPPs to deliver outcomes around essential services, economic effectiveness, replicable and scalable projects, and inclusive development that brings all stakeholders into the decision-making process. Part II also makes reference to the Addis Ababa Action Agenda (AAAA), paragraph 48 of which “calls for the promulgation of guidelines” around the structure and use of PPPs.

Still, the guidelines and other recent actions on PPPs have not been without their critiques. The Civil Society Financing for Development (FfD) Group has flagged concerns about the establishment of international standards by regional commissions, where not all countries have a role in the decision-making process. A PPP Global Campaign Manifesto signed by 152 organizations in October 2017 highlights perceived threats to public finances, equality, democracy and fundamental rights. This follows a March 2016 letter released during the 2016 PPP Forum. An updated version of the letter is expected this week around the May 2018 Forum. The SDG Knowledge Hub has previously reported on concerns about PPPs, in addition to featuring guest articles by experts from Global Policy Forum and Clingendael. Broader coverage of multi-stakeholder partnerships can be found here.

On statistics and the global partnership for sustainable development, the Global Partnership for Effective Development Co-operation (GPEDC) launched a new Monitoring Dashboard. The tool offers visualization for 2014 and 2016 data from Global Partnership monitoring, in addition to external indicators still being added. Relatedly, a report of the UN Secretary-General on trends and progress in international development cooperation was released in late March 2018. The report feeds into the 6th Biennial High-level Meeting of the Development Cooperation Forum (DCF), to be held from 21-22 May 2018, at UN Headquarters in New York.

related events