Creating Value Through Cross-Sector Collaboration
Attend any meeting of the minds within industries such as mining, oil and gas, food and agriculture, or major manufacturing, and you’ll hear about today’s changing demands and requirements. Shareholders expect financial success to be paired with ethical operations. Local stakeholders require increasing levels of transparency and information disclosure. Technology’s exponential progress demands ever-improving management frameworks and applications.
Embedded within these and other changes is the reality that global connectivity and access to information is forcing all industries to rethink what success looks like and how to achieve it.
Enter cross-sector initiatives. These are not novel concepts; we have a reasonably lengthy history of cross-sector collaboration and related programs. However, their importance is growing. Rising populations, increased energy distribution, climate change, and other macro-level trends are bringing cross-sectoral cooperation into the spotlight as one of the most crucial means to the collective end of financial, social, and environment success.
The following three examples are certainly not an exhaustive representation of the various efforts happening around the world. They do, however, demonstrate an expanding commitment to integration across sectors and focus areas.
- In Ghana, the Oil4Food Campaign is encouraging investment of the country’s oil and gas revenues into small-scale agriculture, which involves more than half of all economically active Ghanaians. Oxfam and other organizations teamed with governmental and industry partners after recognizing that oil exports, in excess of $1 billion annually, could be used to drive sustainable improvement within the country’s agricultural system. Improved access to food, enhanced economic success for farmers, reduction of hunger and poverty—these and other objectives are entirely achievable by directly linking extractives to food and agriculture.
- The Cross-Sector Biodiversity Initiative “is a partnership between IPIECA [International Petroleum Industry Environmental Conservation Association], the International Council on Mining and Metals (ICMM) and the Equator Principles Association to develop and share good practices related to biodiversity and ecosystem services in the extractive industries.” The initiative brings together some of the world’s largest and most significant industries in a cross-cutting effort to mitigate the negative impacts of resource extraction.
- The Integration Initiative, conducted through Living Cities, is a broad-based effort “to ensure system level partnerships, policies, processes, and practice are designed to induce economic security and close racial wealth gaps for low income people and people of color in cities.” Living Cities recognizes that certain benefits can only be realized by bringing together commercial entities, foundations, local and regional governance, and other stakeholders in pursuit of clearly stated objectives managed through formalized agreements.
Naturally, there are numerous challenges to successful cross-sector collaboration. The diversity of skills and knowledge, the need for effective communication, the ability to properly identify and coordinate among partners, and experience in integrating disparate methodologies and approaches are only a few of these.
Yet, there are organizations with the multi-disciplinary skills, experience, and holistic perspective to make it work. Industries that work with the right partners and participate in these efforts are able to recognize financial and ESG value that cannot be achieved in any other way.