Engaging the Private Sector in Research for Development
We see the private sector as a critical player in the development landscape.
We work on and with a diversity of for-profit entities to advance development outcomes. These include smallholder farmers, micro, small and medium-sized enterprises, entrepreneurs, investors, national and multinational companies. We encourage our partners and grantees to explore meaningful opportunities with private sector actors. We also encourage the private sector to explore collaboration possibilities with us and our grantees.
Why does private sector engagement matter?
In a complex and resource-constrained environment, actors from every corner of society – including the private sector – need to make smart, evidence-based decisions. Research is an essential tool to identify solutions, set priorities and guide public and private investments to ensure they meet objectives, scale impact and, ultimately, change lives for the better.
The private sector must be fully engaged for research to be targeted, effective and positioned for use. Private sector actors bring resources, innovation, market access and the ability to sustainably deliver solutions. Strategy 2030 reflects our efforts to develop enhanced relationships with a variety of private sector actors, to help move research into use and expand the reach and impact of our initiatives. This includes working both directly with the private sector and on issues that shape the environment in which the private sector operates, for example revising government public procurement policies in East Africa, to better enable women-led businesses to bid for and secure contracts.
The private sector: A key partner for sustainable development
What can private sector engagement look like in research?
Private sector engagement can take many forms. IDRC’s strategy focuses on three main outcomes, with key approaches for achieving each:
Aligning research and private sector priorities
The private sector and development community can have mutually aligned interests, even if their motivations are different. For the private sector, business interests typically include increased profitability or business performance, which are crucial for its sustainability and thus benefit clients in the long-term. These outcomes also provide an incentive for businesses to scale their operations and reach additional customers. Alignment between research and private sector priorities is achieved when a company is providing a good or service that contributes to development outcomes.
Approaches to achieve this outcome include:
Strengthening the enabling environment
IDRC defines the enabling environment in terms of policy instruments (including regulations and laws) and government capacity and systems. These can be at the local, sub-national national or regional level.
The following approaches are used for achieving this outcome:
Expanding access to resources
Businesses in low- and middle-income countries often face a shortage of resources. This includes capital, expertise, networks, data or support, including from business development service providers. This is especially true for MSMEs, which are the majority of enterprises in low and middle-income countries. Addressing these resource challenges is at the core of this outcome.
Several approaches help advance this outcome:
See more examples of IDRC projects working with and focused on the private sector.
What principles guide IDRC’s approach to private sector engagement?
IDRC engages with the private sector in ways that are grounded in development priorities, strategic alignment and meaningful collaboration. Our approach is guided by the following principles:
- Development-driven: All private sector engagement must contribute to building communities and systems that are self-sufficient, healthy and prosperous. Collaborations should help spur innovation, trade and expand economic opportunities for underserved populations in emerging economies.
- Value-adding partnerships: IDRC seeks partnerships where the combined effort delivers results greater than what either party could achieve alone. These collaborations must produce clear value for public investment, while meeting the interests and incentives of private actors. Roles and responsibilities in all partnerships must be well-defined, complementary and transparent.
- Collaborative ecosystems: We value initiatives that foster collaboration across sectors, disciplines and geographies. This includes connecting researchers, universities, civil society, policymakers and private sector organizations at national and global levels. Engaging the private sector in concert with other key stakeholders leverages the distinct strengths of each actor and promotes mutual learning and innovation.
- Strategic relevance to IDRC’s program areas: Private sector engagement should align with our Strategy 2030 research priorities.
By adhering to these principles, IDRC ensures that private sector engagement is not only strategic but also meaningful contributing directly to our mission of advancing knowledge and innovation for a more sustainable and inclusive world.
Is private sector engagement a good fit for your research proposal?
IDRC welcomes research proposals that thoughtfully engage with the private sector — whether as a subject of study, a partner in innovation or a pathway to impact and scale.
IDRC defines private sector actors as profit-seeking organizations with majority private ownership. This excludes non-profits and public entities. We also work with private sector-facing entities — such as industry associations, incubators and accelerators — that support or influence private sector activity.
Proposals from private sector actors are welcomed, either as individual applicants or in partnership with other actors. Proposals can also engage actors that shape the environments in which the private sector operates, such as policymakers and regulators, when those actors can help unlock a solution to a development challenge or address factors contributing to a development problem.
Applicants should be clear about the type of private actor involved, the nature of the collaboration and the contribution to broader development goals. Whenever possible, IDRC strives to incorporate Market Systems Development (MSD) principles in private sector engagement initiatives. Consult IDRC’s Frequently Asked Questions – Private Sector Engagement for additional guidance.
Private sector engagement as part of a research proposal is not a requirement. But when appropriate and done well, it can significantly enhance the relevance, uptake, scale and sustainability of research.