Business (not) for peace: Incentives and disincentives for corporate engagement on good governance and peaceful development in the African context.

This research is a review piece that examines assumptions about the private sector and its peace and development impact, and also questions those assumptions that are underlying major policy instruments, particularly in Europe.

Professor

Brian Ganson

Professor

Faculty of Economics, Business & Management

Stellenbosch University

Professor Brian Ganson heads the Centre on Conflict & Collaboration at the Stellenbosch Business School. His focus is the private sector, conflict, and inclusive development.

American
This research is a review piece that examines assumptions about the private sector and its peace and development impact, and also questions those assumptions that are underlying major policy instruments, particularly in Europe.

Key Takeaways

    How To Apply Insights

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    Why This Research Matters

    There is a major assumption underlying important policy instruments, especially in Europe, that there is an inherent benefit to private sector development, that the private sector has a positive impact in reducing conflict and promoting peace and development. The assumption is also that the private sector is therefore a necessary partner in development, who has an incentive to pursue positive peace and development goals. This article’s significance is that it critically analyzes this assumption.

    Findings & Research Conclusions

    The main argument of the article is that this assumption is untrue. The article rallies evidence that shows that the private sector is not a necessary nor consistently positive actor in promoting development and peace. This is especially true in the African context, where business and private interests are often implicated in conflict escalation rather than peaceful development. Actually, periods of fast growth of the private sector are often associated with conflict escalation and violence. One of the main reasons for it is that the private sector benefit from having a chaotic environment. It allows the businesses not to pay workers a living wage, to not care about negative externalities on the environment, to not contribute to making the social conditions of the area better. If a company can externalize and not bear these costs, it can be very profitable. But companies that do that are profitable for the wrong reasons. Another reason for this is also that the states, the government in power that bargains with the private sector has interests different than creating broad, inclusive development and peace.

    The fundamental conclusion of this article is that you cannot rely on the supposed natural incentives that companies have to be good actors in fragile places. Rather, a regulatory approach is required. An effective regulatory regime will enable good actors that act in a positive way for development and peace. Without regulations in place to guarantee behaviour, these good actors are unable to compete with their opportunistic counterparts. Because regulatory regimes are complex, it is best to gather as many actors to the table as possible. This is easier said than done. However, one thing especially European policy makers could do is to stop subsidizing and actively pushing companies into fragile areas.

    Research's methodology

    This article is a qualitative review and case study article grounded in secondary theoretical and empirical evidence. Journal articles, government reports, documents from international organizations and many similar types of sources were used, and then applied to 11 particular cases.

    However..

    This article presents a strong argument that holds up on average, and theoretically. However, it is not very useful at the level of project implementation, and does not yield insights about particular regions, areas or cases.

    Reference this research

    Ganson, B. (2019). Business (not) for peace: Incentives and disincentives for corporate engagement on good governance and peaceful development in the African context. South African Journal of International Affairs, 26(2), 209-232.

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