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Fair Returns, Job Creation, Not 'Just Charity' Is Path To Success For Business In Developing Economies, Says First-Ever Survey Of Fortune 500s, NGOs & Media

Published 09-15-05

Submitted by Edelman

New York -- In an in-depth survey, fielded by Edelman, the Corporate Social Responsibility Initiative of Harvard's Kennedy School of Government, and Prince of Wales International Business Leaders Forum, of a sample of Fortune 500 companies, global NGOs, investors and the media, about the roles and responsibilities for business in international development, companies and NGOs agreed that corruption in poor countries is the greatest obstacle to companies deciding to enter these markets. There was also general consensus on the need for innovative partnerships when doing business in developing countries, however there were differing perspectives on other key questions of priorities, roles and desired outcomes.

Key findings of the survey, Business and International Development: Opportunities, Responsibilities and Expectations, include:

  • Companies and NGOs agree on lead role for government: poor countries to reduce corruption; rich countries should address trade policies and not just focus on aid

  • Companies acknowledge the value of partnership in developing markets; they recognize that NGOs contribute technical and on-the-ground expertise; less understanding and awareness among companies about the specific role and contribution that multi-lateral institutions offer

  • Mixed awareness among companies of Millennium Development Goals; companies using different language from NGOs and multi-laterals regarding international development

  • Companies rank Africa lowest among all regions for opportunity to: "advance international development and produce returns for companies"; East Asia ranked highest

  • Unilever, P & G, BP, Nike, Citigroup cited multiple times by businesses, NGOs and media as leaders in international development

  • All respondent agree that business' greatest contribution to developing countries is job and enterprise creation, not charity

  • Both companies and NGOs agree that media coverage on business and international development slants negative

  • NGOs more inclined to trust companies that point to profit motive - as opposed to "corporate citizenship" - as key driver in decision making in poor countries

  • Free local press cited as key factor in establishing stable markets in which companies want to invest
Edelman CEO, Richard Edelman, observed, "We are constantly counseling companies to engage NGOs and other stakeholders, about their own activities and impacts. These survey results demonstrate that the international development community - NGOs and multi-laterals - need to re-double their own efforts to engage business about the Millennium Development Goals and related issues with both an approach and language that companies are going to understand and respond to."

Jane Nelson, director of the Corporate Social Responsibility Initiative at Harvard's Kennedy School of Government, noted, "Over the last ten to fifteen years, leading companies have learned the value of engaging and partnering with stakeholders around various aspects of their sustainability and ethical business strategies. It is encouraging to see that companies - and NGOs - also recognize the critical role that partnerships can play around leveraging business' role in developing countries."

Adrian Hodges, Managing Director of the Prince of Wales International Business Leaders Forum, added, "The research findings indicate that thanks to the growing ranks of responsible companies and responsible NGOs, we are moving away from an era too often dominated by the focus on 'what business should not do' to a period which recognizes 'what business can do'. This shift in mood will have the most impact if companies are given appropriate incentives to invest in different business models and new markets, and if civil society and public sector partners are willing to come to forward to form partnerships for common goals."

The full report will be available on-line at 12:00 pm EST: http://www.edelman.com/insights/.

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The Corporate Social Responsibility Initiative at the Kennedy School of Government (KSG) is a multi-disciplinary and multi-stakeholder program that seeks to study and enhance the public role of the private enterprise. It focuses on exploring the intersection between corporate responsibility, corporate governance and strategy, public policy, and the media. The initiative aims to bridge the gap between theory and practice, encourage innovation, build leadership skills and support constructive dialogue and collaboration between different sectors.

The Prince of Wales International Business Leaders Forum (IBLF) is a not-for-profit organization established in 1990 to promote responsible business leadership and partnerships for international development. With a membership of over 80 member companies from around the world, IBLF works in over 50 countries mobilizing visionary leadership and engaging the capabilities of companies in creating innovative and sustainable development solutions.

Edelman is the only independent global communications and public relations firm, with 1,900 professionals in 43 offices worldwide. Advertising Age recently profiled Edelman as one of their "Best Agencies in 2004" and The Holmes Report named Edelman the 2004 International Agency of the Year.

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