Recognising that private sector companies are not neutral when operating in conflict contexts, Anderson and her colleagues adapted many of the do no harm principles to the private sector. Companies can have unintended negative effects on conflicts by altering the distribution of economic benefits, upsetting existing cultural and societal relations and/or generating negative externalities, such as environmental pollution (Ballentine & Haufler, 2009). In the case of the extractive industry, the main beneficiaries are usually the company and national governments with limited employment opportunities or other benefits to local communities that suffer the most from the environmental impacts (Bray, 2009). Companies and aid agencies need to be cognisant of these effects when developing policies and strategies.
Private sector – conflict scenarios
- Company investment can cause conflict through displacement of local communities to clear land (eg for a mine) that creates tensions between host and relocated communities.
- Company operations can exacerbate pre-existing tensions either among communities, or between communities and regional/national authorities, triggering violence, for example through a hiring policy that selects staff from one ethnic group, increasing resentment from others.
- At a higher geographical scale, revenue payments to government could have a destabilising influence on already poor governance structures, increasing the likelihood of conflict in the long-term. Further, revenue could be used to purchase arms, sustaining or escalating conflict.
(International Alert, 2007)
In addition to assessing dividers, it is important to identify possible connectors – programming and projects that will bring people together (Bray, 2009). Case evidence from literature on business and peacebuilding demonstrates that business can address drivers of armed violence by, for example, building bridges between different communities and between state and society; providing good offices and information; acting as a pro-peace constituency; strengthening local economies; and limiting access to conflict financing (Wennmann, 2012).
Development actors and government policy-makers need to include private sector actors in their context analyses to ascertain how they may influence the context. Bray (2009) asserts that it is essential that they focus on the development of an equitable regulatory environment for the private sector at an early stage of economic recovery. They should also encourage the implementation of ongoing private sector initiatives, such as the Extractive Industries Transparency Initiative (EITI), the Voluntary Principles on Security and Human Rights, the Kimberley Process for the Certification of Rough Diamonds, and the UN Global Compact. In addition, efforts should be made to extend conflict sensitive business initiatives beyond the extractive industry to sectors that receive less attention, such as local, small and medium enterprises. In order to provide incentives for business to support such initiatives, donor governments could review and revise aid, trade and investment support policies in a way that alters companies’ cost-benefit calculations (Ballentine & Haufler, 2009). Other incentives for business to engage in conflict sensitivity include the need for a stable environment in which to operate and concern for reputation.
Key texts
Ballentine, K. & Haufler, V. (2009). Public policy for conflict-sensitive business. UN Global Compact Office.
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Bray, J. (2009). The role of private sector actors in post-conflict recovery. Conflict, Security & Development, 9(1), 1-26. doi: 10.1080/14678800802704895
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Forrer, J. Fort, T. & Gilpin, R. (2012). How business can foster peace. Washington, DC: USIP
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Wennmann, A. (2012). The role of business in armed violence reduction and prevention. International Review of the Red Cross, 95(886).
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Zandvliet, L. (2011). Conflict transformation and the corporate agenda opportunities for synergy. In Berghof Handbook for Conflict Transformation, Section IV.
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Extractive industries
International Alert. (2007). Conflict-sensitive business practice: guidance for extractive industries London: International Alert.
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Prospectors and Developers Association of Canada, World Vision Canada, & CDA. (2013). Preventing conflict in exploration: a toolkit for explorers and developers. Toronto.
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Eftimi, A., Heller, K., & Strongman, J. (2009). Gender dimensions of the extractive industries: mining for equity. Washington, DC: World Bank.
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Additional resources
UN Global Compact. (2010). Guidance on Responsible Business in Conflict-Affected & High-Risk Areas: A Resource for Companies and Investors:
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