One of the main drivers of economic development is the private sector’s ability to create jobs and investments that are vitally important for states’ stability and security. Armed conflict and post-conflict situations have a substantial impact on economic life and present a hostile environment to business and investments. The positive connections between the role and needs of the private sector and peaceful development are however still less explored.

Economic development is an important basis for peace and actors in this field are numerous and varied. However, economic development does not automatically lead to peace. Rather it takes unconventional approaches from economic actors to contribute to peace and it takes collaboration from a variety of actors to make this link work.

Considering the multiple risks and associated high costs of violence, a peaceful development and improved socio-economic conditions typically converge with the self-interest of businesses with a long-term objective. The private sector, international and local, can contribute in at least two rather different ways: by conducting its core business and by actively promoting certain elements of peacebuilding.

Although often highly profitable, fragile or complex environments present numerous challenges for an international company. This risk-opportunity balance must be carefully managed to cater for long-term success. Weak formal institutions, opaque power structures, commercial and political interdependencies and ethnic tension are some examples of challenges of the fragile context the company needs to navigate.

The private sector’s main contribution to developing economies and societies stems from its core activity; its ability to offer products and services meeting local demand, and the related effects on job creation and economic growth. In their interaction with suppliers, consumers, employees, and governments and institutions, companies may transfer know-how, promote peaceful tools of conflict management and good governance through their core business conduct.

However, to be successful, companies can’t go about doing ‘business as usual’. In complex or fragile environments, operations and products need to contribute to a virtuous rather than vicious circle of economic and societal development. If implementing conflict sensitive approaches in strategies and operations, companies can facilitate economic development while also contributing to establishing essential conditions for peacebuilding.

In addition to conducting business sustainably and responsibly, private sector actors (individual companies, multinational or local, as well as organized business) are well rooted in local situations, have good local knowledge and are attuned to the dynamics of conflict in the setting in which they operate. They have access to varied networks and players in the local conflict, including armed groups and shadow authorities. Their ability to navigate difficult political environments to ensure continuity of their business operations may be quite advanced. And finally – they may provide a certain degree of stability at the local level through provision of goods and services even in highly fragile settings.

However, they do not automatically lend themselves to peacebuilding: as part of a fragile and /or conflict context they may face greater vulnerability as they cannot easily move their operations out of a conflict context, and they command less socio-political clout. To deal with this situation, they may utilize a range of coping strategies, some of which may directly contravene basic peacebuilding values and practices to function and survive in a fragile context. And some also benefit from conflict and / or might even be direct instigators of communal violence and conflict.

Business should be viewed – and view itself – as a stakeholder in sustainable development, even though a company’s status as a commercial entity may render it difficult to engage in far-reaching development work as such. Today, we have a unique opportunity to make use of the Sustainable Development Goals (SDGs) as a framework to include private sector actors as parties to the development agenda, aligning long-term business goals with global sustainability goals. In fragile and conflict-ridden environments, where the SDGs are likely to meet with the greatest challenges, the participation of business will be vital.

A substantial step towards engaging the public sector in the international efforts in achieving peace is the Business for Peace initiative, launched by UN Secretary-General Ban Ki-moon, which aims to expand and deepen private sector action in support of peace – in the workplace, marketplace, and local communities. The platform assists companies in implementing responsible business practices aligned with the UN Global Compact Ten Principles in conflict-affected and high-risk areas and catalyze actions to advance peace. Companies who join Business for Peace commit to paying heightened attention to the implementation of the UN Global Compact Ten Principles in high-risk and conflict-affected areas; take action to advance peace, either individually or in collaboration with others; and annually communicate on progress.

To conclude, sustainable, responsible business practices and values are not merely complementary features of long-term successful business, but a pre-requisite. As such, the core business and the way it is conducted is the major contribution of a company – not only as a source of financing, innovation, job creation and growth – but through its impact on stability and governance issues, including anti-corruption, peace and security and the rule of law.