Business-Government Partnership – Benefits vs. Risks
Recently Chevron CEO John Watson expressed support for the idea of creating a Business-Government Partnership to promote the American values abroad (1). Public-private partnerships are an intrinsic element of the complex sovereignty in a globalized world…the problem with this idea is that this is a multinational global company and we live in 2013 not in the ’70 or the ’80 (actually it might have worked in the ’90)… and there seem to be some inherent long term risks.
Nevertheless the idea could bring benefits first by consolidating the industries and businesses behind a common goal which could in the long run bring benefits at a national level. Second it is possible that such business-government partnership could have in theory a positive developmental effect from the point of view of institutionalism. One question that would need an answer before shaping the business-government partnership concerns the leadership role in the process because the idea to promote values requires convergence of national interests and business interests. At the expense of what will leadership compromises be reached? Another problem is that this model could start resembling the model adopted in the energy sectors of Russia and China and other countries with similar political model. What would be the positive effect in terms of promoting values?
We live in a globalized world whether we want it or not, whether we realized it or not. In a globalized world the nation-state concept with everything that this notion encompasses cannot or better should not be the one Bismarck envisioned or if Realpolitik is at the core of foreign policy then developmental goals would hardly be reached. From the point of view of social emergence the country and political risks as well as the strategic risks associated with business-government partnerships are internal – at organizational level as well as external – at global level. This model could hinder the companies by internalizing the notion of national interests and affecting their concept of diversity, their organizational culture and finally the success of their global operations. The concept could create new more complex risks associated with the creation of a complex global business environment where business-government relationships would be first “exported” globally and then “imported” in a specific country of operations. Thus the risks from a strategic point of view would come from internal and external conflicts, would have stronger geopolitical connotations, and would be in the realm of transnational activities with all the inherent asymmetric threats. The main risks would be systemic change and reshaping of the global system. How the global system would look in the future would largely depend on the capacity of the companies to adapt and evolve independently.
The fact that governments have become bigger is undeniable. But have they become more efficient? Or more importantly have they become stronger? Were they in fact able to manage or even find answers to the expectations of the societies, of the individual? Why answering in all sincerity to these questions matters? Because the complexity of the emergent global governance system is such that the traditional nation state no longer possesses the level of monopoly of force to leverage all the arising complex national and international issues. A government is responsible for the creation of institutional conditions for prosperity but cannot be the driving force for change management and cannot offer solutions to an organization nor create developmental organizational potential or adaptive capabilities.
In order to manage and mitigate risks the Multinational companies have the capability to leverage and transform their operational environment based on their corporate responsibilities policies and stronger cooperation with the local population by using the collaborative emergence for developmental purposes. A global company does not operate under a flag; it can have inherent values as well as commitments related to its national origins but in order to achieve stable long-term success it should serve the interests of a global community. Business-government partnerships might be successful from a developmental perspective only if they were an element of the global governance system. Are governments and businesses ready to take this risk for the benefits of development?
(1) “Chevron CEO Calls for Business-Government Partnership to Promote American Values“, James Joyner, 02/05/2013; http://www.acus.org/new_atlanticist/chevron-ceo-calls-business-government-partnership-promote-american-values
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