World Bank Fragility Forum explores new partnerships for business and peace
This year the World Bank Fragility Forum featured a session on ‘Building Peace and Profit for Private Sector Engagement in FCV (Fragility, Conflict and Violence) Contexts’.
The panel, on 1 March, was moderated by Elizabeth Hume, the Executive Director of Alliance for Peacebuilding, explored the potential of private sector partnerships to align peacebuilding and business ambitions. Panelists included:
- Daniel Hyslop, Senior Peacebuilding Advisor, Interpeace
- Catriona Gourlay, Executive Director, PeaceNexus Foundation
- Frederik Teufel, Lead Coordinator – Partnerships, Innovation, Private Sector Development, African Development Bank
- Rob Jenkins, Assistant to the Administrator, U.S Agency for International Development
Daniel Hyslop introduced the pioneering work of Finance for Peace at Interpeace to reduce the risk and cost of financing projects by integrating a peacebuilding dimension in their design. Finance for Peace has developed a model for this, the Peace Finance Impact Framework. For example, the costs of raising capital for a project in Ghana were significantly reduced with the inclusion of robust community dialogue and monitoring mechanisms. Daniel highlighted that if such innovative financing mechanisms were to be scaled up with just a percentage of investment funding contributing to peacebuilding partnerships, this would amount to more than all aid for peacebuilding.
Catriona Gourlay reflected on the experience of PeaceNexus as a mission-aligned investor in both public and private markets. Through a peace-themed equity fund and other collective shareholder initiatives, PeaceNexus has engaged multinational companies to monitor their exposure to conflict risk and their performance in FCV contexts. A common challenge for this work has been a lack of geographically specific data from companies. She called for more transparency from publicly listed companies on their operational footprint in FCV. Catriona also reflected on PeaceNexus’ experience with impact funds which make private equity investments in SMEs in fragile contexts. She observed that many have peace-relevant impacts e.g. improved access to basic services and employment for marginalized groups, and some successfully mitigate risks fueling social tensions, for example over access to water or employment opportunities. However, very few systematically assess and monitor their impact on conflict or social cohesion. As Development Finance Institutions are often the principal investors in these funds, she called on them to require conflict sensitivity in their due diligence processes.
Frederik Teufel, African Development Bank, noted that peacebuilding organisations and development banks are increasingly aligned and speak the same finance language. In response to rising instability, for example in the Sahel, he noted that governments, business and civil society are seeking new solutions. AfDB’s partnership with Interpeace is as an example of pioneering work to integrate peacebuilding into the Bank’s instruments.
Rob Jenkins, U.S Agency for International Development, confirmed that aid alone was insufficient to meet current peacebuilding challenges and that the US Global Fragility Act law provided an opportunity for new collaboration with business, especially in the pilot region of coastal West Africa.