Private-sector role is discussed at Habitat III but few businesses show up

As the summit marks the start of implementation of the New Urban Agenda, everyone is interested in financing. But the business presence at this week’s conference was light.

A business assembly met at Habitat III on 16 October. (Habitat III Secretariat)

QUITO, Ecuador — Everyone seems to agree that the business sector is indispensable to getting much done on the big challenges facing cities — particularly the estimated US$78 trillion needed to finance sustainable infrastructure over the coming decade.

But doubts abound over whether business will act, whether it will spend real money and exert serious influence. There have been some corporations represented at this week’s Habitat III summit on sustainable urbanization. However, much of the participation in the process has come not from business directly but rather from those representing various coalitions of firms.

Several of those coalitions — representing dozens or even hundreds of corporations each — did make announcements at Habitat III regarding new and ongoing initiatives around research, monitoring frameworks and multi-stakeholder forums. But no private-sector entity made a major financial announcement. Rather, whatever significant monetary pledges were made at Habitat III were offered by governments and NGOs, according to the Quito Implementation Plan database.

[See: Official commitments to New Urban Agenda off to a slow start]

Still, the role of the private sector has been an issue of significant priority here this week, as has the broader issue of financing the New Urban Agenda, the 20-year strategy on how to plan, build and manage sustainable cities that nations are adopting here this week. Dozens of side events have discussed related issues as the Habitat III summit marks the transition away from policy discussions and toward strategies for how to turn the vision of the New Urban Agenda into reality for cities across the globe.

At a panel here Wednesday, representatives from business stepped up to take on the big questions. Bertrand Benichou of ENGIE, a French multinational electric utility, was quick to call out obsolete regulations. He told a story about an effort to install solar panels on buildings in Barcelona some years back, only to find that doing so was illegal. “Now we need to create space for an accelerated platform,” he said.

Others worry that public policy is not keeping up. Khoo Teng Chye of the Centre for Liveable Cities pointed out that until this century, Singapore had separate departments for nearly every aspect pertaining to water — supply, storm water drainage, sewage —  all of it organized into separate agencies. Now there’s an integrated water system, he said, yielding huge savings.

[See: Business can be a powerful broker in shaping urbanization solutions]

There’s also the matter of the language barrier, and not the usual one. “Business and government don’t speak the same language,” said Shipra Narang Suri, the head of ISOCARP, an international planning association. “And in the past, the process was only transactional — not very inclusive, and so not very effective.” Suri argued vigorously for better incentives and a lot more money.

Alice Charles of the World Economic Forum hit the economic issue even harder, calling for more hard-headed thinking about what actually works, across all fronts of the challenges to cities. She said that the public sector is best for convening at the front end and monitoring results later but urged that “the private sector should take responsibility for designing and implementing solutions.”

And don’t forget the informal business sector — it makes up to three-quarters of the actual business activity in the development world, said Ani Dasgupta of the World Resource Institute Ross Center for Sustainable Cities.

Recognized partner

The good news, said Bert Smolders of Arcadis, is that “it appears that business is now in a serious role” on the urbanization discussion. People are finally realizing, he said, that you must have business at the table from the very beginning. If you’re cleaning up a brownfield for redevelopment or reacting to what Hurricane Sandy did in the New York region, business needs to be brought in as a stakeholder from the outset.

Bolstering that realization could be an important legacy of the Habitat III process, he suggested. Arcadis, a global engineering consultancy, co-led a business stakeholder group in the preparations for Habitat III under an umbrella group called the General Assembly of Partners. Smolders and others this week noted that this was a unique inclusion.

“The fact that we are here is not that obvious. For a long time, the private sector has not been taken as a serious partner in these processes,” he said. “There’s been policy development, and at the other hand there was the daily practice in which the private companies are working.”

Through the group’s work with the GAP, however, Smolders indicated that he thinks business groups “have been able to include important points for the private sector in the New Urban Agenda.”

At the same time, Smolders recognized that increased reliance on the private sector to fund urban development comes with dangers. “This is also a big responsibility,” he acknowledged. “I think we have to be very careful how we as the private sector work in this implementation process.”

[See: Habitat III can galvanize city-business collaboration on sustainable urban infrastructure]

Others also noted increased interest from all sides in deepening participation with the private sector, particularly around innovation and monitoring.

“From the perspective of the three private-sector organizations I’m most involved in, all this year members were very focused on Habitat III,” said Gary Sharkey, with the Global Cities Business Alliance. “I think that the trend of businesses becoming more focused on cities and aligning their products and services to the challenges and opportunities cities face is continuing.”

Still, he acknowledged that thus far Habitat III has seen relatively less direct engagement by business interests than other recent high-level agreements, including the Paris Agreement on climate change and, particularly, the Sustainable Development Goals finalized last year. The SDGs are the U. N.’s 15-year framework to guide anti-poverty efforts; the New Urban Agenda is aimed at guiding efforts at implementing those goals in cities.

“I think now that we have the Paris Agreement, the SDGs and the New Urban Agenda, hopefully that will provide us with good grounds to continue that scale-up,” Sharkey said. “But in particular, the SDGs seem to be the one that businesses are taking to heart now and starting to move forward.”

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Carey L. Biron

Carey is news editor for Citiscope. 

Curtis Johnson

Curtis Johnson is Citiscope’s executive director.