Public Responsibility and Private Enterprise in Developing Countries

In developing countries, firms encounter distinct challenges that place them in situations where they take on functions typically handled by the public sector. These functions range from the provision of health care and education for local communities to the development of political capacity and public policy. Drawing on 30 case studies of companies operating in developing regions of the world, this article presents a typology of four strategies that describe the different ways in which firms can engage in public responsibilities. For each strategy, it outlines the key challenges faced by firms along with suggestions for overcoming them. The burdens firms bear in providing services in response to public policy failures are substantial. Only by effectively developing an appropriate strategic orientation can programs be created that add value both to businesses and to the communities in which they operate.