Governance and public policy

As retailers in the North increasingly adopt codes of practice containing social and/or environmental provisions in global supply chains, there is a need for rigorous assessment of their social impact. Moving beyond the rhetoric, it is important to establish the actual impact of such codes on poorer workers, their families, and other local stakeholders. This paper sets out the key methodological and conceptual issues arising in such an assessment as identified by a three-year study on the South African wine.

In the last two decades, the private sector has been placed under intensifying pressure to ensure it operates in an environmentally and socially responsible manner. Companies have moved through various phases of response, starting with a `deny and defend' position, moving to `paying penance' through donations and philanthropy, and currently settling on risk management through mitigating the negative impacts of their business operations.

Good governance is essential for sustaining economic transformation in developing countries. However, many developing countries currently lack the capacity, as opposed to the will, to achieve and then sustain a climate of good governance. This article addresses, from a practitioner's field perspective, the fundamental objectives, principles, and key areas that need to be addressed for developing capacity for good governance.

This article examines the inadequate delivery of social services by city governments in Nigeria. It identifies three problems: lack of transparency and accountability in governance; under-qualified staff and administration; and the tenuous relationship (an 'us' versus 'them' dichotomy) between the urban residents and local governments. It can no longer be argued that lack of funds is the key constraint.

The World Bank and IMF have proposed the Poverty Reduction Strategy Paper (PRSP) framework for all poor countries as a condition of receiving unconditional debt relief under the HIPC Initiative. The PRSPs will also be the key vehicle for the World Bank and IMF and other donors for various assistance packages, including loans. Like its predecessors, the PRSP framework promotes the ideas of 'participation' and 'ownership'.

Engaging with and assisting marginalised communities remains a major challenge for governments of developing countries, as many national development strategies tend in practice to further marginalise chronically poor communities. Development aid strategies, including poverty-reduction initiatives, have focused primarily on economic development. As a result they have contributed to the erosion of the asset base of these communities, and in particular their access to natural resources.

Since the 1990s, development agencies and international institutions have promoted private-sector involvement in infrastructure, assuming that this would inject both investment and efficiency into the under-performing public sector. In the water and energy sectors, these expectations have not been fulfilled. Private-sector investment in developing countries is falling, multinational companies have failed to make sustainable returns on their investments, and the process of privatisation in water and energy has proved widely unpopular and encountered strong political opposition.

A corporation has only limited ability to create social capital through philanthropic activity, and in the context of a decline in official aid, the corporate sector is increasingly assuming a de facto developmental role. The presence of social capital assists communities in moving towards sustainable development and may contribute to the business case for corporate- community partnerships.

Although the concept that corporations are responsible not only to their shareholders but also for the social and environmental impacts of their activities has now entered the mainstream, pressure is still required to ensure that companies honour their public commitments. This article describes the work of the Ecumenical Council for Corporate Responsibility in harnessing the power of individual shareholders and ethical investors in order to hold companies to account, with particular reference to the activities of Shell in Nigeria and the Republic of Ireland.

Few issues in the development process raise as much heat as the role of the international private sector in the form of transnational corporations (TNCs) and foreign direct investment (FDI). This article reviews the most recent research on the impact of FDI on economic growth and poverty reduction in developing countries. A brief history of FDI is given. This is followed by discussion of the conceptual transmission mechanisms linking FDI, growth, and poverty. The available empirical evidence is then discussed.