This guest blog was written by Selma Hilgersom (Simavi). The original blog post is available here and is re-published with permission and thanks from Simavi.
Last week, I attended the AGUASAN workshop. This yearly event is organised by the Swiss Agency for Development and Cooperation and joined by a broad variety of WASH practitioners. The key focus of this year’s workshop were ‘service providers that take an inclusive business approach and drive the advancement of the human right to water and sanitation’. Within the conference, six cases of young and inspiring entrepreneurs were put forward during the week and participants teamed up to dive into the business cases and assess the human rights angle of making a business out of WASH.
If anything, the week has given me a serious mind exercise on the role of the private sector in development. I have a background in the field of water technology and supporting the development of innovative business propositions. I do believe that the private sector is key in addressing global challenges. Business comes with internal drivers to guarantee the delivery of products and services that meet the demands of costumers, as entrepreneurs depend on the success of their business to generate an income. This drives efficiency, cost-efficiency and the continuous exploring smarter ways of working.
So, if business has the potential to provide everyone in the world with well-functioning WASH infrastructure, why are we not collectively entrepreneuring into the most rural areas of this world and ensuring that the human right to water and sanitation is fulfilled? And why are NGOs still funded to do a job that business can do while making money out of it?
Let’s first set the perspective straight. I work for an NGO. I am not afraid to re-consider my role in a fast-changing world. I do believe business has an key role to play in accelerating development and strengthening (business) ecosystems in-country. Especially local entrepreneurship and equal North-South partnerships can go a long way in providing people with the basic services that they need. Especially the businesses that pro-actively include women and girls and effectively respond to the needs of all members of a given community, regardless of who they are and their circumstances, seem to have the exact same goal as many NGOs. And stepping away from the ‘beneficiary perspective’ and including people as ‘costumers’ creates a different perspective. Two sidenotes: let’s try to avoid the discussion whether capitalism is the system that ensures everlasting happiness here and at the same time acknowledge that disadvantaged people benefit from a system in which they are participating as more than just ‘costumers’ that are defined by their purchasing power.
The nature of business is to ensure that there is a profit made. And from my experience in start-ups, this is a challenge when starting-up a business. The question that comes to my mind is then how feasible it is to design a self-sustaining business model targeting consumers with the least purchasing power, especially in the beginning. And whether it is possible to focus on the lower-bottom of the pyramid; even if this comes with challenges. A few examples: geography (what if a village is located at a remote mountain), reaching relatively few costumers per community, having to invest a lot in demand-creation before WASH services and products are bought. Are there smart models that make this ‘work’? Or stable financing mechanisms that can blend different revenue streams to cover the high need with the limited profitability? And how do you create a business ecosystem with local entrepreneurs to serve the people who currently lack access to WASH? What is the role and contribution of the government?
There is a broader development perspective to this too. Including ‘impact indicators’ in doing business, which reflect the aim of development work, does require extra efforts that may conflict with business interests. But results in lasting positive change in communities. Think of delivering water in a community where people are at high risk of a specific disease; is this just solved by delivering water? Or does this require the provision of additional health information and working towards improved service delivery? Or in the case that women are not allowed to decide over their own bodies, does the delivery of WASH provide an answer to the broader challenges that exist in the community?
Even if we would imagine an all-inclusive model of the private sector that perfectly responds to the needs of people, there is still one discussion that was put forward more than once during AGUASAN: (government) systems are the enablers of the success and upscaling of any business. The central question is therefore how business models fit in existing local, national and global systems? This links into the very basis of acknowledging that people have rights, and that they should be able to claim them, wherever in the world that may be.
And this is not ‘just a remark’ – it links into the issue of rightly anchoring the responsibility where it belongs: who is (or should) take the responsibility for fulfilling the human right to water and sanitation, and what is the place of the private sector therein? What to do if there is no profitable business case for providing WASH? Maybe the consideration is whether the ideal business model, if it would exist, would silence this discussion: does access to WASH equal that human rights are fulfilled? Even if this is done independently from the government, and in a profitable way? And if so, is it possible (capacity wise) to reach the 2.1 billion people (!) that still do not have safe and sustainable water delivery? Should the private sector be made responsible for fulfilling the human right to water and sanitation, if governments fail to do this?
I am not afraid of profit. I believe that businesses and NGOs both play a vital role in development. I believe in systems that are driven by (young) entrepreneurs and create a broad-range of value to consumers and are self-sustaining. There are many examples in the world where the private sectors makes a huge difference in the lives of disadvantaged people. I refer to the two amazing female entrepreneurs of Pad2Go who want to break the barriers women face in Nepal due to their menstruation (and with whom I had the honour to work with during the week). I am incredibly happy that many entrepreneurs are positive towards cooperation with NGOs. However, I also believe that this comes with a joint dream and a joint responsibility.
Often, the cooperation between NGOs and the private sector is defined by the roles ‘taking care of the business’ and ‘taking care of development’. I advocate for a more integrated business case, where investing in business and investing in development are one and the same thing. Could we agree that the success on the broader impact indicators is equally important as the development of a sustainable business model? And not from a ‘charity perspective’, but from the believe that this will increase the integrated value proposition of businesses. And thereby open up new markets and potential (impact) costumers. And a call to NGOs – can we move beyond the output, outcome and impact indicators, and join hands with those who will remain long after the funding of our NGO programmes has run out? And create built-in incentives to be as successful as we can? And not be guided by pre-set targets?
One of the things that stayed in my mind after AGUASAN is the presentation of human rights superstar Ms. Catarina de Albuquerque, who challenged us to “make the last mile the first mile”. Let’s do that. Together.
Edit from the author: I had some discussions about the extent of ‘pushing (Western) values upon local communities’, and whether businesses or even NGOs should be involved in this at all – or that we should limit ourselves to basic product or service delivery. I can write another blog on my thoughts on this. As this blog has a slightly different focus, I refer to Simavi’s aim to ensure that disadvantaged people in low and middle income countries are enabled to practice healthy behaviour based on their own free and informed decisions and free from coercion and violence. By doing this through supporting civil society to claim its rights with and through local organisations, development is no more than amplifying positive changes that start locally.
About the author
Selma holds a master degree in ‘Human Geography’ and ‘Policy and Organisation’ with a specialisation in transnational advocacy and business and innovation. She has worked in international organisations to promote and support the development of new business models, sustainable innovations and the uptake of new water technologies. Currently, she coordinates programs of Simavi in Tanzania and Nepal that aim to ensure that disadvantaged people, and especially women and girls, can live healthy lives