KAMPALA PRINCIPLE: TUs_SUBP 5.C

Sub-principle 5.C

Share risks proportionately to incentivise private sector contributions to leave no one behind

 

Why is it important?

 

Partnering is not a low-cost, quick fix or risk-free option. Partnerships require sharing risks and benefits. The costs of partnering can be high, not least because of the time needed to explore, establish and manage the partner relationships. It is important to recognise that risk is felt disproportionality between partners and stakeholders. Those with greater power may need to take a higher risk to best assure that no one is left behind. Trade unions need to consider the opportunity costs and, preferably, establish some benchmarks against which they will measure whether the intended outcomes of partnering are worth the investment. They are essential to supporting workers within the project to ensure they are not negatively affected by the partnership’s risk taking.

Self-reflection questions
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  • Have the local community and workers involved helped assess local risks in PSE projects? Have your members been asked to provide input to related risk analyses? 
  • Have potential risks for each stakeholder been assessed and given due consideration to the proportionality of risks being taken on by public and private actors vis-à-vis the benefits to local communities?

Actions to consider
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  • Ensure that the provision of free, prior and informed consent and social license to operate was offered as part of the due diligence assessment.
  • Support the identification and assessment of risks for workers and the beneficiary communities.
  • Prioritise shielding vulnerable populations and sectors from risk.

Pitfalls to avoid
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DON’T…

  • Ignore the communities whose land is being affected by the project. 
  • Ignore that potential conflicts of interest are inevitable and not inherently negative.

COUNTRY-LEVEL EXAMPLES

These case studies show concrete examples of risks of PSE when local communities and workers are not engaged: 

  • CIDA-led mining project in Peru that subsidises 85% of different corporate social responsibility policies of Antamina, Barrick Gold and Rio Tinto
  • the IDA and USAID led the construction of the Caracol Industrial Park in Haiti 
  • AECID, Spain, led Water and Sanitation Cooperation Fund in Colombia.

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