The right business environment for more – and better – jobs
Nine out of ten jobs worldwide are in the private sector. An attractive and sustainable business environment can only be built if there are effective state institutions, good public service delivery and corporate responsibility in place.
A solid infrastructure and services like electricity, water and basic sanitation are as important for business as conducive economic, legal and regulatory conditions. To this end, Switzerland supports its partner countries with the reform of their public services and efforts to strengthen state institutions.
A programme in Peru, for example, helps the public financial administration improve its budget planning and expenditure controls, and increase its tax revenues. In Albania, Switzerland has supported local water utilities with efforts to improve the delivery of water supplies to public and local businesses. In the last few years, they have performed better and boosted their operational efficiency. The introduction of water meters means that costs are now charged more accurately, and these are now recovered more efficiently thanks to improved invoicing.
SDC project: The SABA water and sanitation experience: boosting impact at global scale (SABA+)
Good corporate governance: when the private sector shoulders its responsibility
A sound infrastructure is not enough. Just as states have to provide a solid and advantageous framework, the private sector needs to have guidelines in place to ensure that companies are run responsibly. Corporate governance – the regulations, values and principles that stipulate how private firms are to be managed and policed – has been a focal point of Swiss international cooperation efforts since the late 1990s.
Corporate governance as well as the creation of a conducive environment for private-sector growth are in keeping with the 2030 Agenda for Sustainable Development, which was adopted by the UN in 2015 and calls for the mobilisation of private capital and the creation of public-private partnerships to fund development goals. According to the Dispatch on Switzerland’s International Cooperation 2017-20, Switzerland will boost its contribution to the creation of decent jobs by investing in business and strengthening international standards.
2030 Agenda for Sustainable Development
SECO provides support when statutory provisions are non-existent or patchy. Its efforts focus on assisting with the creation of an institutional framework that is conducive to corporate governance standards and capacity building to that effect. SECO also helps to make stakeholders aware of the importance that investors give to compliance with corporate governance and corporate social responsibility standards.
Corporate governance efforts in Indonesia
In 2015, SECO, together with the International Finance Corporation (IFC) of the World Bank Group, supported various corporate governance projects in Indonesia. The IFC directly advises Indonesian firms on matters such as greater transparency and better shareholder protection, and it assists the government with the drafting and implementation of legislation and regulations. The IFC also builds the business advisory capacities of local partner organisations.
In 2015, more than 3,000 individuals – including more than 900 women – from family-run businesses, limited companies, banks and state-run firms in Indonesia benefited from the support of the IFC and its partners. As a result, these stakeholders have been able to develop measures specifically geared towards their own organisations.
More to Swiss commitment than corporate governance
In 2012, SECO launched a project in Indonesia which addresses other issues besides corporate governance. The Sustainable Cocoa Production Programme (SCPP), which is jointly run by SECO and its partners, seeks to create a better enabling environment for sustainable economic growth. The aim is to make the entire cocoa production value chain more effective and environmentally friendly and, in doing so, improve the lives of around 60,000 smallholder cocoa farmers.
The SCPP works with 4,500 cocoa producer groups, which have business ties with around 1,000 upstream and downstream micro-, small and medium-sized companies, farmers’ organisations and 10 multinational cocoa and chocolate producers. Other project participants include the local authorities and NGOs. SECO provides roughly CHF 6.5 million of the CHF 16 million project budget.
