By Judith Randel, Executive Director, Development Initiatives
The debate is no longer is about whether the private sector has a role to play in ending poverty but how. Over the course of this week, we have explored where business can do more to end poverty.
What we haven’t discussed in detail up until now is how the private sector can achieve this. The event hosted by Development Initiatives and Business Fights Poverty last night sought to explore just this.
A key message emerging from the meeting is the need for the private sector to move beyond engagement to commitment and then action for sustainable development. Without private sector involvement, delivering the post-2015 development agenda will be difficult. But it becomes next to impossible without more and better data and access to information.
So why does data and access to information matter?
A lack of data is the biggest challenge preventing better use and understanding of private sector finance – where it goes, to whom and why – and how it is influencing poverty reduction. We especially need to know how resources invested in different sectors deliver benefits, especially for people on less than $2 a day who are often bypassed by growth.
We need data on how finance reaches different regions, down to the sub-national, and even to the level of households and individuals. Without this information, all resources, including private sector resources, cannot be optimally allocated and tracked, progress in contributing to poverty reduction cannot be effectively monitored, lessons about effective and efficient policies cannot be learned and people in developing countries cannot be empowered to demand accountability.
What does this mean in practice?
It means contributing to a development data revolution by collecting and disaggregating data on different types of resources flows to developing countries, and using this information to better target resources at the poorest people.
Harnessing the best data techniques to end poverty
None of this is new ground. We just need to better harness these opportunities.
The good news is that the private sector is well placed to provide, and has a comparative advantage in accessing, this type of data. It holds and has access to a wealth of data on people in developing countries that even governments of those countries do not.
There are many examples of where the private sector has been able to collect and use disaggregated data for poverty reduction at low cost. Sproxil, a pharmaceutical company in Nigeria, added unique scratch codes to drugs so consumers could text the code to a free phone number and receive a reply confirming whether the drug was genuine and in date. Through this process, Sproxil gathered critical data on the prevalence and distribution of Malaria, as well as the use of pharmaceutical drugs.
Orange, a telecoms business, launched the Data for Development challenge in 2011. This challenge encouraged research teams from around the world to use four ‘big data’ datasets of anonymous call patterns of Orange's Ivory Coast subsidiary to analyse social development needs. Orange was keen to see how data it collected daily could be used for better development outcomes. One use correlated mobility analysis with information on the spread of disease leading to the strengthening of models used for predicting the spread of disease, more effective preventative measures and the optimum allocation of medical resources.
Moving this agenda forward: what opportunities exist?
Involvement in the Global Partnership and discussions around the post-2015 development agenda offer the private sector an opportunity to foster public-private partnerships and to work together with international partners to drive a development data revolution.
We know that transparency helps create a level playing field and an open, stable environment for business. By engaging with mechanisms such as the International Aid Transparency Initiative (IATI), the private sector can help make sure that all private sector resource flows to developing countries can be tracked alongside aid flows, making it easier to trace delivery and impact. The large amount of data and expertise belonging to the private sector represents a leadership opportunity to add another dimension to Business Fights Poverty.
This blog is part of a series hosted with Development Initiatives.
Business Fights Poverty and Development Initiatives hosted an event in London on Thursday 27th February to explore the ways in which the private sector can contribute towards ending poverty. To find out more click here.
Connect with Development Initiatives on Twitter @devinitorg
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