On Course for a Better World

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On Course for a Better World
Phase II:
PARTNERSHIPS IN THE DANISH SHIPPING INDUSTRY
An inspirational guide to engage in partnerships
Prepared by:
Janni Thusgaard Pedersen
Louise Kjaer
and
with support and input from CSR on Board, Helle Johansen
September 2012
The project ”On Course for a Better World” is initiated by The Danish Business Authority and
The Danish Shipowners’ Association. The project is financed by The Danish Maritime Fund, The
Lauritzen Foundation, Orients Fond (NORDEN) and The TORM foundation.
The aim of the project is to document how Danish shipping industry creates social,
environmental and economic value globally, and inspire Danish shipping companies to
strengthen their work with social, environmental and economic sustainability issues.

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Executive summary
This report is addressed to the Danish shipping industry and discusses the potential advantages for
shipping companies of engaging in partnerships. It is intended as an inspirational guide that can assist
the industry in implementing responsible and sustainable business practices through partnerships.
A growing number of corporations have come to realise that the manner in which they conduct business
can have a significant impact on the environment as well as on society. Leading corporations have
demonstrated that there is no contradiction between running a profitable business and dealing diligently
with impacts on sustainability – quite the contrary. At the same time, there are increased political and
societal expectations of corporations to act responsibly and make business models more sustainable.
However, sustainability is often linked to complex political processes and societal contexts, which can be
best challenged when joining forces with other actors. Partnerships have therefore become an effective
means for businesses when demonstrating corporate social responsibility (CSR) as they allow partners to
utilise and benefit from their joint expertise.
The report asserts that the benefits of engaging in partnerships depend on the scale of involvement and
on which actors are involved. Some of the direct benefits to businesses can include increased brand
value, attraction of talents and access to specialised knowledge and expertise. Partnerships can also
produce joint benefits for partners, including the possibility to address greater structural issues in society
composing barriers for the industry or business as such.
Partnerships can present opportunities of long-term engagement on relevant issues and enable
businesses to influence legislation and create industry standards. Seen from a CSR point of view,
partnerships present an opportunity to increase impacts when going beyond compliance and creating
strategic value. However, partnerships may also be the most effective way to prevent and mitigate the
corporation’s adverse impacts in society. Whereas corporations cannot be forced into partnerships,
partnerships may often prove more effective to address the companies’ challenges and therefore more
cost-effective.
The report seeks to provide the shipping companies with an overview of the many reasons for engaging
in partnerships, who to partner with and how to get the most out of partnerships in addition to outlining
key considerations in a phased approach to engage in partnerships.
Partnerships cover a vast area of activities. In order to target key considerations typologies are used to
describe different kinds of partnerships, i.e. Public-Private Partnerships, Private-Nonprofit Partnerships
Business to Business Partnerships, and Global Public-Private Partnerships. In addition partnerships take
many forms depending on the level of commitment. Three levels of engagement are described in the
report:
1. Transactional Engagement – providing for sponsorships or donations;
2. Transitional partnerships – integrating CSR activities into core business; and
3. Transformative partnerships – generating innovative solutions to sustainability challenges
The use of partnerships with UN organisations, local governments and NGOs, is particularly relevant
where the partnership aims to create cultural changes in local communities beyond the shipping
industry’s own employees.

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Table of Contents
PARTNERSHIPS IN THE DANISH SHIPPING INDUSTRY.......................................................................1
Executive summary.......................................................................................................................2
Abbreviations ...............................................................................................................................5
Background for the report..............................................................................................................6
Context....................................................................................................................................6
Purpose and target group...........................................................................................................8
Methodology.............................................................................................................................8
How to use the inspirational material ...........................................................................................8
What are partnerships and CSR? .................................................................................................. 10
What is a partnership? ............................................................................................................. 10
Definition............................................................................................................................ 11
What is corporate social responsibility, CSR? .............................................................................. 11
Context of partnerships............................................................................................................ 11
Why engage in a partnership? ...................................................................................................... 13
Benefits to the Company .......................................................................................................... 13
Head-off trouble .................................................................................................................. 13
Accelerate innovation ........................................................................................................... 14
Foresee shifts in demands..................................................................................................... 15
Enhance corporate image...................................................................................................... 16
Joint benefits .......................................................................................................................... 18
Pooling of resources ............................................................................................................. 18
Set industry standards.......................................................................................................... 19
Shape legislation ................................................................................................................. 20
Create a shared platform ...................................................................................................... 20
Reasons for Partners to engage in Partnerships ....................................................................... 21
Potential challenges in partnerships........................................................................................ 22
Who to partner with? .................................................................................................................. 23
Public-Private Partnerships.................................................................................................... 26
Private-Nonprofit-Partnerships............................................................................................... 28
Business to Business- Partnerships......................................................................................... 29
Global Public-Private Partnerships .......................................................................................... 29
Level of engagement ............................................................................................................... 31
Transactional Engagement – providing sponsorships or charity .................................................. 32
Transitional partnerships – integration of CSR activities into core business.................................. 34
Transformative partnerships – generation of innovative solutions............................................... 35
How to get the most out of partnerships........................................................................................ 39
How to engage in partnerships ..................................................................................................... 41

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The partnership phases............................................................................................................ 41
Formation ........................................................................................................................... 42
Initiation............................................................................................................................. 43
Implementation ................................................................................................................... 44
Evaluation........................................................................................................................... 46
Steps to engage in a partnerships ............................................................................................. 46
FORMATION ........................................................................................................................ 48
INITIATION ......................................................................................................................... 49
IMPLEMENTATION................................................................................................................ 49
EVALUATION ....................................................................................................................... 49
Literature .................................................................................................................................. 50
Internet sources...................................................................................................................... 51
Appendix 1 ................................................................................................................................ 52
Why engage in partnerships ..................................................................................................... 52
Who to partner with? ............................................................................................................... 54
Level of engagement ............................................................................................................ 57
How to get the most out of partnerships .................................................................................... 61
Steps to engage in a partnerships .......................................................................................... 64
FORMATION ........................................................................................................................ 64
INITIATION ......................................................................................................................... 65
IMPLEMENTATION................................................................................................................ 65
EVALUATION ....................................................................................................................... 65

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Abbreviations
B2B Business to Business partnerships
CSR Corporate Social Responsibility
GPPPs Global Public –Private Partnerships
MACN Maritime Network on Anti-Corruption
MDGs Millennium Development Goals
NGOs Non-Governmental Organisations
NPOs Non-profit organisations
PNPs Private – Non-profit organisation Partnerships
PPPs Public-Private Partnerships
RSCM Responsible Supply Chain Management
UNGPs United Nations Guiding Principles on Business and human rights

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Background for the report
Context
Since its launch in year 2000, the UN Global Compact has gained widespread acceptance and authority
among businesses worldwide. Throughout the years, the UN Global Compact has come to set the agenda
within CSR internationally and has guided many businesses to become more sustainable and responsible
in their operations. Also the Danish shipping industry has acknowledged the importance and value of
active engagement with the basic principles for sustainability through their corporate activities. The UN
Global Compact plays a central role for this effort and provides a common frame and direction for the
work that Danish shipping companies do in relation to CSR. The UN Global Compact is in itself a global
partnership between a variety of stakeholders, and the UN Global Compact promotes partnerships as a
means of achieving sustainable development:
“The UN Global Compact asks companies to:
1. Internalize the ten principles in their business strategy and operations, and
2. Take action and engage in partnerships to advance the broader UN goals, such as the
Millennium Development Goals (MDGs).”1
The United Nations acknowledges the value and need for partnerships to achieve sustainable
development. The formation of the UN Global Compact was based on realisation that governments
needed to partner with business around the basic international principles for social, environmental and
economic sustainability in order to realise the vision of their implementation and thus enhanced
sustainability.
This is reflected in the UN Secretary General’s understanding of partnerships:
“Partnerships are commonly defined as voluntary and collaborative relationships between
various parties, both State and non-State, in which all participants agree to work together to
achieve a common purpose or undertake a specific task and to share risks, responsibilities,
resources, competencies and benefits." 2
From a corporate perspective CSR consists of two dimensions both necessary to enhance and protect the
financial value of the company:
 Compliance Expectation: On one hand corporations need to ensure that they do not contribute
to adverse impacts on the international principles for sustainable development as defined by the
UN Global Compact principles. The UN Guiding Principles on Business and Human Rights from
2011 (the UNGPs) with their implementation in the OECD Guidelines, in the definition of and
strategy on CSR by the EU Commission and by the Danish Government in its national action plan
have improved considerably the opportunities for businesses to get compliance ‘right’. A common
global reference point for how to avoid adverse impacts on the principles for sustainable
development increases the opportunities for cost-efficiency in implementation; especially in the
longer term. The compliance part of CSR in alignment with the UN Global Compact and the
UNGPs was explored in relation to responsible supply chain management in a separate delivery
under Phase II of this project;; confer the inspirational material: “Making the UN Global Compact
operational in alignment with The UN Guiding Principles on Business and Human Rights in relation
1
See: http://www.unglobalcompact.org/issues/partnerships/index.html accessed 20 July 2012
2
See Report of the UN Secretary-General, August 2003

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to Responsible Supply Chain Management”, 27 June, 2012. If a business faces great risks for
negative impacts on specific sustainability issues, partnerships can be an efficient way to
establish systems to enhance compliance, e.g. by addressing some of the root causes for the
challenge, spread costs, improve credibility etc.; as an example the Maritime Anti-Corruption
Network (MACN) addresses such compliance challenges in relation to economic sustainability
proactively. Establishing partnerships around providing access to remedy for victims of adverse
impacts may present another obvious opportunity to engage in a difficult compliance area via
partnerships. However, there are no direct expectations for business to engage in partnerships or
to improve management of risks through partnerships.
 Proactive Contributions to Sustainable Development: CSR also include the dimension that
corporations contribute to sustainable development. Corporations may choose to do this in many
ways; e.g. through employee and community engagement programs, new product lines, and new
market access strategies. It can be argued that donations and sponsorships are not to be
considered part of CSR since such endeavours do not affect business practices and, thus, do not
lead to sustainable changes for the business enterprise itself. However, it can also be argued,
that donations and sponsorships can be used strategically to promote strategic business
objectives on CSR. As an example Novo Nordisk in creating the World Diabetes Foundation
enhances the CSR objective of contributing to right to health in relation to diabetes care while
enabling business objectives. In partnerships donations can be used strategically as an entry
point for closer partnerships. No matter how business engage, the challenges in relation to
sustainable development are quite massive. In line with the conclusions of the UN, corporations
often experience that they need to cooperate with other actors if they seriously and effectively
want to address some of these key challenges. Therefore they create or participate in
partnerships. As a result, most often partnerships are utilised in proactive approaches. In addition
partnerships open for a range of additional advantages, and challenges, which will be explored in
this report.
International Standards
Proactive contributions:
Should be based on relevant priorities, aligned with
core business activities and business competences.
Focus should be on finding competitive advantages,
or answering particular high risks.
HOW to ensure not to becomie a barrier: The UN Guiding Principles
WHAT:TheUNGlobalCompact
Compliance:
Having a policy and process in place to ensure that you
identify, prevent, mitigate and account for adverse impacts
on international principles for sustainable development
and provide for access to remedy where you do.
Partnerships provide an effective way of contributing
proactively
Responsible Supply Chain Management is how you
manage your responsibility in upstream value chain
relationships; confer other delivery in Phase II
Fig. 1 Illustration of strategic CSR with its two dimensions: compliance and contributions.

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Purpose and target group
The Danish Business Authority, The Danish Shipowners’ Association and its individual members all
recognise the importance of the UN Global Compact to the field of CSR. This inspirational material seeks
to inspire the shipping companies to consider enhancing their opportunities for creating or participating in
partnerships as a way of implementing CSR in their businesses. It seeks to give practical, yet
theoretically well-founded, information on the do’s and don’ts in relation to different forms for
partnerships.
The inspirational material was developed by experts in the field of CSR and partnerships with the input
from CSR departments as the primary target groups. However, the material can also be used in relation
to other personnel groups that would need to consider their role in partnerships while enhancing the CSR
efforts of shipping companies; e.g. a CSR or ethics committees, top management or communication
departments.
Methodology
The inspirational material has been developed based on a wish from the members and on interviews with
individual members of the Danish Shipowners’ Association, The Danish Business Authority and the
experts assigned for the task, Janni Thusgaard Pedersen and Louise Kjaer, based on input from GLOBAL
CSR and CSR on Board. The material is based on a collection of best practices as well as on expert
knowledge of lessons learned within CSR partnerships over the past 16 years.
The work was carried out over a period of eight months in 2012 through a combination of interviews and
a desk review of data collected from members of the Danish Shipowners’ Association. In addition to
meetings with stakeholders, websites and other material relevant to partnerships of the Danish shipping
companies were reviewed. Several meetings were adjourned by the Danish Shipowners’ Association and
its members in order to enable understanding of the scope of work. Lessons learned from stakeholder
interviews and other inputs are incorporated in the material without specifically referring to single
sources.
The experts extend their thanks to the members of Danish Shipowners’ Association that participated in
the work, The Danish Business Authority and all stakeholders participating.
How to use the inspirational material
The inspirational material on partnerships seeks to answer some of the essential questions in relation to
engaging in partnerships. Throughout the inspirational material the content is supported with examples.
In addition each chapter is supported by tables outlining core considerations to be taken into account
when engaging in partnerships. The considerations are supported by more easily accessible ‘do’s and
don’ts’, all supporting the points made in the chapter.
The first chapter “Why partnerships” is outlining the different opportunities and gains from partnership.
This chapter is divided into benefits to the company, emphasising the direct benefits the company may
gain from engaging in partnerships and the joint benefits to partners, outlining some of the indirect
benefits, which all partners involved may gain from the partnership.

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The second chapter “What is a partnership” defines the terms partnerships and CSR and stipulates the
context of partnerships and its role in CSR. The chapter presents considerations on how partnerships can
be a means to work strategically and proactive with CSR. The chapter presents various types of
partnerships, outlining the variety of possibilities for partnering with different actors. Finally, there is a
description of different possibilities for getting involved in partnerships – both emphasising challenges
and opportunities related to the different levels of engagement in partnerships.
The third chapter “How to engage in partnerships” provides a cyclical model of a partnership. It describes
the different phases which are required to carry through with a partnership; formation, initiation,
implementation and evaluation. It also provides a table with key questions to be raised in the different
phases.

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What are partnerships and CSR?
When working with Corporate Social Responsibility (CSR), companies may benefit from working in
partnerships with other businesses or with actors from other sectors. Such partnerships can address both
challenges and opportunities in relation to social, environmental and economic sustainability.
Partnerships may well serve as CSR initiatives, where they address sustainability issues. By collectively
working towards achieving more sustainable business practices, for example through agreements to
reduce carbon emissions or to prevent adverse impacts on human rights in the supply chain, business
partnerships become a vehicle for CSR. Both from an ethical and economical viewpoint, businesses
should only consider engaging in partnership activities that are relevant to core business activities.
The Danish shipping industry is by no means an exception and already has experiences of engaging in
different partnerships across many areas – both within the industry but also externally with other
stakeholders. For example, the industry has engaged in partnerships that aim to ensure sustainable
business solutions in the area of environment, e.g. Green ship of the future, Clean Cargo Working Group
etc., and is currently involved in a new network fighting corruption – the Maritime Anti-Corruption
Network (MACN). Until recently the Danish shipping industry primarily engaged in partnerships and CSR
activities concerned with environmental sustainability. With its focus on anti-corruption and thus
economic sustainability, the MACN network represents a new area of involvement for the Danish shipping
industry in relation to CSR. In comparison the MACN network does not require development of new
technologies to the same extent as the case is for partnerships addressing the environment. Moreover
the joint leverage of the network is aimed at generating changes of the level playing field within the
industry; i.e. changing structures, mentalities and behaviours. The Danish shipping industry
demonstrates very well both the variety of challenges which can be addressed through partnerships and
the various ways of engaging in partnerships.
What is a partnership?
Business collaboration between different partners is not a new phenomenon. However, in recent years
new partnership models have emerged. The new partnership models are to a greater extent shaped by
common interests and values shared by a broad variety of
partners. Another characteristic of these new models is a
willingness to share risks and opportunities between
partners. At the most basic level, a partnership is an
opportunity to address common issues by leveraging joint
resources and using difference as strength. The most
effective partnerships therefore recognise and take
advantage of the strengths of each party.
To maximise the positive outcome of a partnership, it is important to consider the specific characteristics
of different types of partnerships, as well as their potential and limitations. In the following chapter,
different models for partnerships will be presented, including perspectives on the challenges and
opportunities inherent in each type.
Box 1: In partnerships we collaborate to...
 pursue common goals,
 leverage joint resources, and
 capitalise on the strengths of both
partners

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Definition
Partnerships can be defined as:
“a sort of collaboration to pursue common goals, while leveraging joint resources and capitalising on the
respective competences and strengths of both partners”3
.
This rather broad definition of a partnership captures a variety of partnership constellations. This is
important, as partnerships can take many forms and involve many different types of actors.
What is corporate social responsibility, CSR?
Corporate social responsibility (CSR) is when a company integrates social, environmental and human
rights concern into their business operations and core strategy in close collaboration with their
stakeholders4
. The Danish Council on CSR defines CSR as follows:
“The company demonstrates corporate social responsibility and creates value for both the
business and society by entering into dialogue with its stakeholders to address social,
environmental and ethical challenges in accordance with internationally recognised
principles” (Guidelines for Sustainable Supply Chain Management, June 2010).
Capability to adjust to and anticipate future regulative measure is also seen as a part of industry’s
ability to work with CSR.
Behind this definition is the notion that it creates business value for a company to integrate societal
concern in addition to what a short-sighted business calculation immediately shows. Responsible
companies contribute to creating “shared value” – as expressed by the economists Michael E. Porter
and Mark R. Kramer:
”The concept of shared value can be defined as policies and operating practices that
enhance the competitiveness of a company while simultaneously advancing the economic
and social conditions in the communities in which it operates. Shared value creation
focuses on identifying and expanding the connections between societal and economic
progress”.5
Thus, CSR is more than taking on a voluntary responsibility for negative externalities independent of –
or in addition to regulative or economic steering mechanisms. CSR in Danish Shipping companies is
about the industry’s ability to create collective social value and contribute to global development.
Context of partnerships
With the launch of the Millennium Development Goals (MDGs)s and the increasing awareness of global
warming the development agenda entered into a new ear. Among others the paradigm centres on the
acknowledgement of the need to join forces and to share responsibility between public and private actors
to address development challenges. The ties between different actors must be strengthened in order to
generate good governance, sustainable economic and environmental development, peace and security
3
Jamali & Keshishian, 2008: 279
4
EU Commission: A renewed EU strategy 2011-14 for Corporate Social Responsibility (COM(2011) 681 final)
5
Michael E. Porter and Mark R. Kramer (2011)

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and poverty reduction – all factors required to create an enabling environment for people to live a
dignified and productive life and for business to blossom. Also, the increasing globalisation of business
has generated a growing recognition of the impact of multinational corporations on the local community
and the opportunities that lies within joining up forces with such global players. The new scope for
business has enabled a more profound understanding of the underlying drivers of sustainable and long-
term approaches to business development. In that perspective, the possibility to establish partnership
with a variety of actors has both produced new business and development opportunities.

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Why engage in a partnership?
Multi-sector partnerships are complex. They critically depend on establishing strong working relationships
between key individuals/partners often from very different working cultures. Multi-sector partnerships
therefore take considerable effort both to establish and to nurture to maturity. The time required to build
strong and enduring partnerships can lead to frustration and disappointment. When successful, however,
you may obtain also unforeseen advantages.
Partnerships in this inspirational material are seen as a way to implement CSR strategies as well as
improving impacts from CSR activities. The benefits from partnership engagement are therefore linked to
the benefits from engaging in CSR. This material focuses on the benefits for the Danish Shipping
Industry. Partnerships have the potential to generate value for both businesses and society. The degree
to which the benefits will materialise will depend on the level of engagement and the scope of the
activities. The following section highlights individual benefits generated by partnerships; however the
benefits are very much interlinked and some may overlap. Being aware of the potential benefits of
partnership will create a solid foundation to make strategic decisions when approaching different
partnership models.
Fig.2 Illustration of benefits of partnerships
Benefits to the Company
Four potential benefits for corporations engaging in partnerships stand out:
Head-off trouble
Partnerships offer an opportunity to build relationships with external stakeholders. Such relationships
serve several purposes. One important aspect is that partnerships establish alternative communication
channels that constitute platforms for dialogue. These channels may serve as radar to identify and
overcome obstacles before they materialise into actual problems. In order to ensure this, regular
consultations with partners and stakeholder dialogue can prove highly valuable.6
BENEFITS TO THE COMPANY PARTNERSHIP BENEFITS
Alternative communication channel Build relationships
Fig.3 Illustration of benefits to the company and joint benefits
6
Yaziji, 2004
Head-off trouble
Foresee shifts in
demands
Accelerate innovation
Enhance corporate
image
Benefits to
Company
Pooling of resources Set industry standards
Shape legislation
Create a shared
platform
Joint Benifits

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Accelerate innovation
Partnerships give access to new networks and thereby allow for a more holistic approach to business
development. Partnerships may also provide direction to addressing meta-problems by fostering new
perspectives and new ways of framing problems and solutions7
. As such the networks create
opportunities for establishing channels to reach new markets. Companies can gain knowledge about local
markets and innovative processes in order to respond to local and global demands. Partnerships can
broaden the strategic lens of the company and support the company in achieving economic success by
responding adequately to local social demands. Hence, the core business of the company may be
developed to respond to social needs and thereby create shared value.
An increased number of corporations see a business opportunity in developing products that respond to
the needs of the people at the base of society, “the base of the pyramid” e.g. addressing the world’s
poorest with less than 2 USD a day as a consumer8
. Through partnership collaboration with e.g. local
non-profit organisations companies may gain access to crucial knowledge of local consumers and market
conditions. Releasing the potential of the “base of the pyramid” has become yet another strong argument
for businesses to engage in partnerships, meeting the needs and demands from this large yet untapped
segment of consumers.9
Nokia, ICIC, Datawind, Hindustan Unilever and Artiel are examples of companies
who have increasingly considered the potential of untapped consumers at the “base of the pyramid”.
Even though this approach to business development seems promising, it might be less relevant to the
Danish Shipping Industry as such. None the less the potential of entering into new dynamics and
business constellations to respond to challenges in society may inspire the Shipping Industry to an even
larger extent to appreciate and explore opportunities for partnering with a variety of actors.
One of the main arguments for business to engage in partnerships is lack of in-house expertise on
sustainable development and local challenges and the inability to develop these skills and competences in
a timely and cost-effective manner. The involvement of partners means unique access to knowledge and
resources that can foster a dynamic environment for creating sustainable and efficient solutions. Entering
a partnership promotes opportunities for developing new products and services, knowledge sharing,
efficiency improvement and knowledge creation, eventually enabling companies to become more
innovative and competitive. As a result, partnerships may enhance the flexibility and adaptability of the
corporation.
7
Yaziji, 2004
8
Prahalad. Et al, 2005
9
SOS Child Villages, 2011
Box 2: Combating diarrhoea and expanding the soap market in India
Through communication campaigns, HLL the Indian supplier to Unilever has created behavioural changes among
the base of society, by communicating the clear links between the use of soap and health - one of the most
important resources of the poor. Through partnerships with London School of Hygiene and Tropical Medicine, the
US Centres for Decease Control and the Environmental Health Project, the World Bank, USAI and local
governments, Unilever has been able to increase sales of its low-cost, mass-market soap and proactively
contributed to improve the health of the poor (Prahalad2005:2207.241).

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The brand value and image which can be created through partnerships can be used strategically to
attract and retain talents. Internally partnerships can strengthen current employees’ moral and
motivation thereby increasing employee ownership and loyalty. Partnerships may give the opportunity for
the employees to develop at a personal level insofar the partnerships promote active employee
engagement in CSR activities. Interpersonal, administrative and technical skills, reflexive skills, social
learning, and leadership are some of the potential benefits that employees gain from partnerships.
If the Danish Shipping Industry wants to
utilise partnerships as a means to develop the
skills of employees, companies are advised to
engage in partnerships that build on the core
objectives for both partners. A partnership
that builds on the mission of both partners
increases the involvement of employees and
therefore also the possibility for learning and
development10
. Consequently, partnerships
contribute with various dimensions to accelerating innovation and to strengthen competitive ability.
Foresee shifts in demands
Partnerships can create a closer and more direct contact to consumers and costumers as well as bring a
closer connection to political decisions that affect a company11
. As such partnerships can allow for a
greater understanding of trends as well as a foresight to political risks that can influence a company.
10
SOS Kinderdorpen, 2010
11
Yaziji, 2004
Access to new markets
Knowledge about local marked and demands
Broaden strategic lens
Access to specialised expertise
Strengthen adaptability
Addressing meta-problems
Create added value to society
Box 4: DONG Energy engages in partnerships with
costumers
Dong Energy engages in partnerships with its business
clients to develop products and services that can
minimise CO2 emissions and reduce energy consumption
(DONG Energy 2012).
Box 3: Optimising WFP processes and operations using TNT core skills
“Sharing knowledge is an essential part of TNT's partnership with WFP. TNT sends specialist skilled people to all
parts of the world to help WFP build capacity and exchange skills and knowledge. TNT supports WFP with
projects which call upon its core skills and expertise in areas like distribution, supply chains, process
improvement, customers, engaging employees and environmental issues. In 2009, for example, TNT undertook
transport optimisation projects in Mali and Ethiopia. These projects help WFP optimise its transport routes and
improve the efficiency of its transport capacity, leading to reduced workloads and substantial cost savings.
With these projects, both TNT and WFP people gain knowledge and experience which can be applied back in
their day-to-day work.”
(TNT 2012)

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These benefits inherently improve business competitiveness. From the perspective of the Danish Shipping
Industry a partnership may offer an opportunity for the single company to become more adaptable to
changes within the industry, both in regards to demands from costumers who e.g. require services which
are more CO2 neutral or to comply with and influence legislation on cargo.
Fig.5.Illustration of benefits to the company and joint benefits
Enhance corporate image
There is a high probability that the partnership can create a greater visibility of a company’s activities
among stakeholders and improve Public Relations (PR), thereby raising brand value. This can be part of a
strategic approach to gain more control over the manner in which business is portrayed in the media. The
exposure of the partnership can also improve company credibility and trust among consumers and
costumers12
, which e.g. can be measured through the Trust barometer13
. But the increased PR exposure
may also lead to increased vulnerability of the company. Companies have to carefully balance their
communication activities, to avoid any unforeseen risk of being scrutinised by media and consumer
scepticism14
.
Collaborating with independent and legitimate
partners requires establishment of mechanisms of
accountability and transparency, which increases
the credibility of a business15
. As a result,
partnerships may generate trust among
stakeholders and customers, since partnerships
can function as checks and balances mechanisms,
ensuring that businesses not only focus on profit but also act in a socially responsible manner.
Furthermore partnerships’ inherent acceptance by NGOs or multilateral organisations strengthens the
legitimacy of the company. In most cases engaging in partnerships will increase the credibility of the
company, since a third party ‘certifies’ the services, products and the company. Such external
certification can increase customer satisfaction and create trust-based relationships with consumers,
which in the end may result in increased loyalty of the consumers. Consequently, companies can gain an
advantage over their competitors who do not actively participate in partnerships.
12
Bown et.al. 2010
13
http://trust.edelman.com/about-trust/
14
Mette Morsing
15
Bown et.al. 2010
Direct contact to costumers and political decision
makers
Establishing a platform for mutual leverage
Box 5: Green Ship of the future
The objective of this public- private partnership is to
join forces to develop technical solutions for cleaner,
more energy-efficient and sustainable ship and
maritime operations. (Green Ship 2012)

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Fig.6 illustration of benefits to the company and joint benefits
The table below provides you with some bullets outlining core considerations you need to take into
account in order to be successful with your partnership and to gain the listed benefits.
Fig.7 illustration of core considerations on benefits to the company
As outlined above, there are several benefits to the single company which can be drawn from a
partnership. In the table below, we provide a small guide of dos and don’ts to help you gain the most of
partnerships in relation to the benefits of the company.
Fig.8 Illustration of do’s and don’ts
Create visibility
Generate trust and credibility
Establishment of mechanisms of transparency and
accountability
CORE CONSIDERATIONS ON BENEFITS TO THE COMPANY
 If a problem cannot be solved by one company alone, partnerships may be a necessary means
to address the issue
 Evaluate how competencies, information, and resources from partnerships can support the core
business of the company
 Consider how your business can utilise its leverage strategically, while bringing different forms
of knowledge and expertise in play
 Consider how partnership activities can stimulate individual learning internally and foster
motivation and ownership among employees
 Consider how partnerships can enhance contact with costumers
 Consider which kind of PR exposure a partnership may produce
 Consider how different partnerships may strengthen or weaken the brand value of the company
 Consider how to establish mechanisms of accountability and transparency with partners
 Consider how to share costs and resources
BENEFITS TO THE COMPANY – DO’S AND DON’TS
DO’S
 Work with long-term projects, you will not see the results of the partnership overnight
 Establish a team of employees across departments
DON’TS
 Do not think that your partnership will be unnoticed

18
Joint benefits
Even though the focus of the material is on the business opportunities of partnerships’, business is also
dependent on a well-functioning society; thus indirectly the gains of society are also gains to business.
Pooling of resources
One of the advantages of partnerships is the sharing of costs and resources that would otherwise prevent
a company from addressing a societal issue. Sharing of resources allows participants to engage in
projects that have a long-term perspective and are more far reaching than activities that the company
normally engages in. In the context of the Danish Shipping Industry most partnerships, that embraced
long-term targets, have primary been linked to sustainable technology development. In this respect the
MACN provides a good example of the necessity of pooling resources in order to overcome societal
challenges affecting both society and businesses.
In particularly, partnerships are useful when they aim to change cultures, habits, public opinion, attitudes
and behaviour. One example of this is the role that the shipping industry can collectively have in
changing societal views on corruption. The shipping industry faces a particular challenge in changing the
culture around facilitation payments. In order to overcome such challenge a change of culture is needed.
The industry as a whole has to move stakeholders’ perceptions away from considering facilitation
payments as an implicit prerequisite in doing business and move towards a joint understanding of
facilitation payments as unsustainable damaging and an unacceptable condition for business. In order to
change a culture around facilitation payments all stakeholders involved in upholding such culture need to
be involved in order to change. When it comes to changing the environment in which the company is
doing business, partnerships can provide a strategic resourceful platform to operate from.
In the case of the MACN network, partnering with local NGOs, labour unions, Danida and United Nations
Development Programme (UNDP) will provide an opportunity to address the challenges of changing
behaviours and mind-sets in a holistic manner. Whereas the NGOs and labour unions may create
awareness and behavioural changes within civil society and among employees, UNDP and Danida could
push for changes at a political level. Creating changes at both levels is crucial, if you want to create
sustainable solutions to the problems surrounding corruption.
Box 6: Joining forces within the industry
Some of the gains from the Maritime Network on Anti-Corruption (MACN) network are;
 To collaborate to address and solve specific challenges
 To share best practices among members and align policies and approaches in the field of anti-corruption.
 To share resources and create leverage to solve industry challenges.
Corruption and in particular facilitation payments are barriers faced by the whole industry which prevents
operating in a sustainable and responsible manner. Therefore this partnership presents a value proposition for the
industry as a whole and for society.

19
One of the ambitions of the MACN network is to
seek support from government bodies and
international organisations to target corrupt
practices in challenging jurisdictions and encourage
solutions to root causes for the same.
Set industry standards
Partnerships give society increased access to commercial opportunities which may otherwise be
restricted. Partnerships therefore become a crucial platform that companies can operate from when
aiming to gain influence and leverage in the development of business standards. The business standards
that partnerships can influence may be linked
to the quality of products or equalising
the general conditions for business
operations; in particular those that enforce
sustainable behaviour. The leverage to develop
standards may be created by pulling together
the industry in order to reach agreements on
license to operate, but many also focus on stakeholder engagement e.g. engagement of civil society,
public or multilateral organisations. These may serve as neutral participants, assuring fair and
sustainable solutions for all companies in the industry and for society. Furthermore setting industry
standards is also about achieving first mover advantages. For instance Novo Nordisk worked with
“Dyrenes Beskyttelse” (the largest Danish animal protection NGO) to improve the living conditions of
animals used during pharmaceutical trials. The standards developed, and incorporated by Novo Nordisk,
were later mandated by the EU leaving Novo Nordisk with first mover advantages16
.
Influence on business standards Create license to operate
16
http://www.novonordisk.com/images/science/Bioethics/Downloads/Bioethics_Animals%20DK_25-09.pdf
Able to address issues, which you could not
solve on your own
Sharing costs and resources enabling engagement
in long-term projects
Box 7: Sustainable Shipping Initiative (SSI)
The Sustainable Shipping Initiative (SSI) brings together leading companies from around the world, NGOs Forum for
the Future and WWF to plan how the Shipping Industry can contribute to - and thrive in - a sustainable future. The
SSI is designed to help the Shipping industry to make long-term plans for future success.
(Forum for the Future 2012)

20
Shape legislation
Partnerships also offer an extraordinary opportunity to create leverage to address gaps in legislations and
governance17
. Partnering with business may therefore be a reasonable approach for governments, in
order to both attract business and to create sustainable solutions. This is especially the case when a
variety of stakeholders are in partnerships, so-called Multi-Stakeholder Initiatives (MSIs). They create an
opportunity to establish solid and far reaching solutions to complex and over-arching societal problems.
Businesses benefit from participating in shaping legislation ensuring pragmatic solutions for business.
Once legislation is in place all companies are required to follow the same rules. This reduces the risk of
free-riders;; i.e. companies that do nothing, but benefit from peers’ actions. The Danish Shipping Industry
may consider the potential benefits of partnering with the EU commission in programs under the
implementation of EU CSR strategies in order to influence both strategies and legislations. The
International Maritime Organization (IMO) or the International Labour Organization (ILO) could be other
possible partners if striving to influence global technical and environmental regulations for shipping. The
authoritative reference point of the UNGPs may serve as a strategic advantage for the Danish Shipping
Industry, since the Danish Shipping Industry is one step ahead when it comes to e.g. environmental
friendly modes of transport, health and security etc. In the long run aligning expectations to the shipping
industry globally can create a level playing field.
Influence legislation Reduce risk of free-riders
Fig.11 Illustrations of benefits to the company and joint benefits
Create a shared platform
Partnerships generate an opportunity to establish communication platforms that serve as a means of
consultation between affected stakeholders and allow for the inclusion of various perspectives. A
company that engages in such a platform will have the opportunity to be on the forefront of critical
issues.
From a societal perspective, the communication platform offered from partnerships can also be used by
non-private sector actors to pressure companies to address their social responsibilities and bring to the
fore issues that companies may be unaware of. The communication platform offered from partnerships
can help minimise the expectations gaps between stakeholders and thereby assist in creating realistic
outcomes from the onset of a partnership.
17
Yaziji, 2004
Be on the forefront of critical issues Minimise expectation gaps and create realistic
outcomes

21
CORE CONSIDERATIONS ON JOINT BENEFITS
 By sharing costs and resources, consider how your businesses can contribute to addressing
complex societal issues
 Consider how to establish dialogue encouraging different forms of knowledge to flourish
 Consider how your businesses can contribute to influence the development of industry
standards through partnerships
 Consider how your businesses can use joint leverage of a partnership to address gaps in
legislation or other governance issues.
 Consider how partnerships involving with a variety of stakeholders can serve as a
communication platform and as a means of consultation between different stakeholders and
thereby minimise expectation gaps
Fig.13 Illustration of core considerations on joint benefits
JOINT BENEFITS – DO’S AND DON’TS
DO’S
 Establish mechanisms and communication channels
 Engage regularly in stakeholder dialogue, especially when critics emerge
 Identify gaps in legislations
 Identify stakeholders working for the same cause
DON’TS
 Don’t expect to get immediate results
Fig. 14 Illustrations of do’s and don’ts
Reasons for Partners to engage in Partnerships
Partnerships give the partner an opportunity to establish direct relationships with companies, which
normally may be difficult to get in contact with. As a result, partnerships may be a means to gain access
to resources and influence. Since partnerships provide an opportunity to build a relationship with a given
company, there is a greater chance to engage in constructive and transparent discussions with the
company. Hence partnerships offer a leeway to establishing dynamic interaction and better access to
information flows and expertise. The partnership may offer the possibility to capitalize on the respective
competences and strength of both partners. Especially partnerships with international corporations can
result in access to a wide range of different stakeholders for example employees and consumers, which
might be of particular interest to the partner.

22
Potential challenges in partnerships
Although partnerships can create value for a company and entail many positive outcomes, there are also
potential challenges related to engaging in partnerships –for private companies as well as for their
partners. Both the company and the potential partner need to be willing to invest some extra efforts into
building a common language around the partnerships, establish communication channels and work flows,
suiting all partners involved in the partnership. Otherwise bottlenecks of communication and
misunderstandings may compromise the partnership. Partnerships are resource demanding and require a
long time horizon. Therefore, tracking concrete results of partnership activities will only be possible after
a certain amount of time. If conditions are not made clear from the very beginning, it may discourage the
teams working on the partnership activities. This could lead to lack of ownership compromising the
consolidation of the partnership within the organisation. In order to avoid that, it is central to develop key
performance indicators.
Another aspect to stress is the issue around image. Engaging in partnerships requires willingness to
compromise and to reach consensus. Consequently, all parties involved need to consider potential
negative consequences of accepting eventual compromises. Since work methods, organisational cultures
and values may differ, it can be a challenge to reach consensus and set priorities and goals for the
partnership. As a result, it can be a challenging assignment to develop suitable governance structures for
collaboration. An NGO can for example loose legitimacy if it engages in partnerships with too many
companies or if it has to compromise some of its core values in order to reach consensus with the
partners. Also, partnerships involve a risk of loss of reputation, where partners experience scandals.
Other challenges related to partnerships relates to overcoming mistrust and fear of losing control. If such
issues are not addressed early on in the process, they might become a barrier for developing a fruitful
partnership. Since a partnership requires a certain amount of openness from the partners, another risk
related to partnerships is confidentiality.
Engaging in partnerships therefore requires that certain agreements and mechanism are in place to
ensure confidentiality. Seen from a business perspective, some of the main barriers for entering a
partnership are; lack of knowledge about potential partners, lack of relevance to the company and lack of
resources18
. Some of the main barriers for NGOs to start business partnerships are, similarly, lack of
knowledge of partners, lack of clarity how partnerships link to their strategies, lack of resources, lack of
acknowledgement of partnerships, and lack of skills19
18
Hockerts, 2010
19
ibid

23
Public-Private partnerships Nonprofit-Private partnerships
Business to Business partnerships Multilateral-Private partnerships
Types of partnerships
Who to partner with?
Partnerships can be structured and carried out in a number of ways. The choice of a specific partnership
model will depend on a number of considerations. Regardless of which partners you engage with and
which level of engagement you may choose, a partnership will inherently cause challenges for those
involved. But such challenges can often be outweighed by the potential business opportunities.
Partnerships can include a broad range of actors. A shipping company might consider partnering with
industry partners to address common challenges such as; piracy, responsible supply chain management
and compliance with the UN Guiding Principles on Business and Human Rights. Or it might consider
engaging in cross-sector collaborations that draw on the capacity and resources of different societal
sectors. Cross-sector partnerships could focus on several areas linked to the core business of the shipping
industry, such as; trade of arms - violating the right to life, liberty and security, restrictions on freedom
of movement or broadening the current engagement in activities linked to economic sustainability by
looking at taxes.
There are many potential forms of partnerships for companies working in the shipping industry. A
company might engage in a partnership with public institutions, non-profit actors, multilateral
institutions, or with other business enterprises. Partnerships may also include actors from more than two
sectors, such as tripartite partnerships.
The partnership between The Danish
Shipowners’ Association and public
authorities is an example of a public-
private partnership, focused on air
emissions and ballast water. The
consultancy within Engineering,
Environmental Science and Economics,
COWI, provides another example of how it
can be meaningful to involve different
types of actors in a partnership. COWI
builds a bridge in Mozambique in a partnership with the `national roads and infrastructure’ ministry. As
part of the contract COWI is engaging in preventative work on AIDS which they do through a local NGO
called Verde Azul (NGO)20
. Finally, business to business partnerships can be exemplified through the
Global Business Initiative on Human Rights, which is a business-led initiative working towards advancing
human rights in a business context around the world21
.
20
http://www.cowi.dk/menu/tema/temaarkiv/mozambiqueensucceshistorieiafrika/afrikanskbrobyggerimedaidsforeb
yggelse/Pages/afrikanskbrobyggerimedaidsforebyggelse.aspx
21
http://www.global-business-initiative.org
Box 8
 Types of partnerships refers to the constellation of stakeholders, sector involvement
 Partnership Model refers to the construction of the partnership as a whole – including considerations on
which stakeholders to involve and the level of engagement in the partnership by the different partners.
Fig.15 Illustration of different types of partnerships

24
When forming a partnership, it is crucial to consider how different stakeholders could contribute to the
collaboration. It is necessary to consider how the objectives of the partnership will be reached, by what
means and through which resources, capabilities and competences. Specifically how do the different
partners complement each other, and what is the most fruitful constellation of partners? The figure below
highlights some of the potential (social/development) contributions the various types of partners may
contribute with22
.
Fig.16 Illustration of the different actors to partner with
As outlined in the figure, the contributions of the different sectors differ. In order to gain the most out of
a partnership, being aware of these differences and identifying potential synergies is of great value.
Another important factor to consider when engaging in partnerships is the type of resources that are
needed in order to reach the objectives of your CSR activities. Different partners contribute with different
resources. The figure below outlines some of the resources offered by the different partners.
22
Warner & Sullivan, 2004
TYPES OF PARTNERSHIPS CONTRIBUTIONS
Public sector:
International agencies; national, regional
and local government; public sector
services; donor agencies; academic and
educational institutions
• Foundation of justice through law and
regulations
• Physical infrastructure
• Social infrastructure and safety
• Education
• Public finance budget
Business sector:
International and national companies,
associations, networks, financial
institutions, enterprise development
agencies.
• Foundation of economic growth by
employment generation
• Tax revenue
• Trade
• Investment
• Provision of goods and services etc.
Non-profit sector:
Community-based organisations, non-
governmental organisations, not-for-
profit organisations, private voluntary
organisations, interest-based
representations
• Base for liberty, responsibility and personal
expression
• Social cohesion
• Legitimisation
• Training

25
RESOURCES TYPES OF PARTNERS/SECTORS
Public sector Business sector Non-profit sector
Human resource Seconded personnel;
i.e. personnel that
temporarily work for a
different organisation
Seconded personnel
Employee volunteers
Volunteers
Relations Policy makers Business network
Marketing opportunities
Suppliers
Community relations
Media opportunity
Relations to Non-profit
sector
Expertise Technical
Project development
Education
Technical
Project development
Training
Management
Monitoring
Project development
Training
Facilitation
Information Facts, knowledge &
Statistics
Legal background
Market analysis
Forecasting
Local Knowledge
Social sensitisation
Logistics Access
Offices and venues for
activity
Transport
Equipment
activity
Transport
Equipment
Products
Access
activity
Fig. 17 Examples of the resources different actors can contribute in a partnership – source Louise Kjær
Keeping potential contributions and resources in mind, the following sections will describe the different
types of partnerships which involves various stakeholders, emphasising their challenges and their
opportunities.
CORE CONSIDERATIONS ON TYPES OF PARTNERSHIPS
 Consider your motivations as well as advantages of attracting a certain partner
 Consider how your business and can complement a potential partner; take advantage of each
other’s strengths and minimise weaknesses
 Consider if you are willing to share resources, knowledge and skills across different business
sectors or other business partners
Fig.18 Illustration of the core consideration on types of partnerships

26
Fig.19 Illustration of do’s and don’ts in regard to types of partnerships
Public-Private Partnerships
Partnerships between private companies and public bodies – whether they be national governments, local
councils or other authorities – are termed Public-Private Partnerships (PPPs)23
. The term can be used to
describe a variety of arrangements between the public and private sector, involving different
combinations of public or private sector finance and risk exposure.
The overarching objective of PPPs is to address
societal challenges that can best be addressed by
combining resources from the public and private
sector. The expectation is that this will help public
bodies solve problems that are difficult to single-
handedly address, while partnering private companies
can gain long-term benefits – such as continuous
contractual agreements or revenue subsidies – for
engaging in the partnership.
A successful PPP transforms a public project into an attractive investment for a private sector partner.
Hence, PPPs should ideally generate value and meet the objectives for both parties involved. As such,
PPPs are more than one-off transactions and need to be based on the right policies, institutions, and
processes to be successful. Long-term contracts can foster strong mutual interest between parties and
entail large financial benefits as well as generate societal value for both public and private partners. While
public bodies can bring capacities such as a regulatory framework, strategic coordination, and a public
finance budget to a project, private companies can contribute with technical skills, human resources and
23
Farquharson, E. et al. 2011
TYPES OF PARTNERSHIPS – DO’S AND DON’TS
DO’S
 Be open-minded
 Take the time to find the right partner with the right competencies
 Ensure there is buy-in to the partnership at different levels of the partner organisation
 Engage in trust-building activities early in the process
 Ensure mutual confidentiality
 Agree on concrete governance structures for the partnership
 Develop a framework for measuring outcome based results
 Establish centralised points of contact and dedicate personnel to the partnership
 Establish adherence to a common agenda to ensure long-term alignment to shared objectives
DON’TS
 Do not engage in partnerships, if your business is not willing to change
 Do not consider difference to be a barrier. Utilise it as a catalyst for change
 Do not build a partnership on prejudice
 Do not expect immediate results; partnerships involve a steep learning curve
 Do not hesitate to get involved
Box 9: Focus areas of PPP’s
PPPs often focus on infrastructure
development and delivering public services
that have important social implications, such
as water and electricity.

27
additional funds to successfully deliver the service to the general public. If interests are aligned from the
beginning and expectations for the collaboration are clear, the chances for a successful partnership will
increase.
PPPs are attractive to the public sector due to the
benefits of mobilising private capital, which can help
speed up the delivery of public services. Other overall
benefits include greater efficiency in the use of
resources, good quality assurance and risk aversion.
The incentives for private businesses lie in the chance
to boost their CSR profile whilst securing large
contracts. A PPP may also be a means to gain long-
term contractual agreements with the public sector,
which can ensure future business. Engaging in a PPP
will require willingness of the private company to align
their business activities with a rather long-term
project timeframe and the willingness to corporate
with bureaucracy. As such, the described type of
partnership would be defined as a public investment
partnership, where the private company delivers the
service required.
Another PPP worth considering by any business forming part of the Danish Shipping Industry would be
`Danida’s Business Partnership´. This PPP has a very different vision of strengthening sustainable
development in an international donor-context. Any business forming part of the Danish Shipping
Industry should consider taking a closer look at Danida’s Business Partnerships initiative. Engaging in a
partnership with Danida may be slightly different in nature from a traditional PPP, since this partnership
would require engagement in activities in developing countries, but may nonetheless pose an interesting
business opportunity. The challenges of operating in a development country in an international donor
context may be a concern for the company. At the same time, this partnership may be of particular
relevance in relation to areas such as piracy, anti-corruption, restrictions on freedom of movement and
trade of arms.
One of the challenges faced by the Danish and the European Shipping Industries is the growing
competitiveness from the world’s emerging economies. A growing number of shipping centres in
emerging markets strives to attract global shipping companies and employees by offering attractive
economic conditions. While favourable economic conditions remain important, talents are attracted and
Box 10: DANIDA business partnerships
 Danida Business Partnerships serve to lower
the risk for businesses of entering new
partnerships.
 It partly covers relevant expenses related to
the transfer of knowledge and skills.
 The initiative covers up to 50-75 pct. of costs
of activities
 The initiative supports activities such as
partner identification, partner visits, market
analysis, risk analysis, due diligence,
development of business plans, testing of
business models, and outlining of indicators.
(UM 2012)
Box 11: DANIDA business partnerships with Toms – Developing new technologies
Through a partnership, between DANIDA, the Ghanaian Research institute, Cocoa Research Institute of Ghana
(CRIG) and Toms, the partners have been able to develop improved methods of fermentation of coca beans. The
new methods save time and workflows, minimise negative influence on the environment and secure a higher
quality of coca beans.
(Toms 2012)

28
employees retained through thorough CSR approaches. The UNGPs now form a basic expectation under
CSR. Consequently, the UNGPs can serve as a strategic means by which the Danish and European
shipping industries to compete with these emerging economies. Sector partnerships collaborating on the
implementation of the UNGPs in the shipping industry may be a means to work towards a level playing
field for the shipping industry when it comes to addressing adverse impacts on human rights and possibly
the environmental and economic bottom lines as well.
Private - Nonprofit-Partnerships
Partnerships between private companies and non-profit organisations are referred to as Private-Non-
Profit Partnerships (PNPs)24
. Such partnerships can be driven by both economic- and non-economic goals.
To be considered a partnership, the activities between the private sector and the non-profit sector should
be based upon the sharing of resources, knowledge and skills between a company and a non-profit
partner. A financial donation would not in itself be considered as a partnership. Nonetheless starting out
with a donation also called a philanthropic activity (cf. transactional) may be a potential entry point for
the partnership, allowing the partners to get familiar with each other and to establish trust and goodwill
before engaging in a more integrated partnership with higher entry barriers.
PNPs partners often face the challenge of having to balance very different sets of values, beliefs and
modes of operation. Such differences present a barrier which must be overcome at an early point in a
partnership. It is therefore of great importance to initially align interests and objectives and ensure that
all partners share the same partnership vision.
For businesses, some of the possible benefits of
partnering with Non-Profit Organisations (NPOs)
include heading off trouble, accelerating innovation,
gaining legitimacy, foreseeing emerging market
trends, gaining influence on legislation and
establishing new industry standards. Often NPOs are
the preferred partner when trying to enter new
markets, especially in economic developing countries.
Often such NPOs have the needed knowledge of the
local market. In general NPOs specialised knowledge of social and environmental issues add value when
trying to address complex issues such as child labour, corruption, illegal foresting etc. This specialised
knowledge of social and environmental issues is tightly connected to establishing legitimacy. Complex
issues most often cannot be addressed in isolation. They require collaboration with local partners who are
regarded as credible and legitimate representatives.
For NPOs PNPs entail benefits in the form of increased financial or technical support for projects and
causes. Moreover, PNPs will increase the impact of NPOs on corporate behaviour and may eventually
influence industry standards. As such, PNPs entail large potential benefits to both parties25
.
24
Kolk, A. et al. 2008
25
Yaziji, 2004
Box 12: Focus areas of PNPs
PNPs can have many different areas of focus,
including initiatives for environmental,
economic and to a large extent social
sustainability, such as health, labor rights,
equity and education.

29
Business to Business- Partnerships
Business to Business-Partnerships (B2B)26
, cover strategic alliances between different corporate entities.
Through the pooling of resources and skills, partners can work together to achieve common goals, as well
as goals specific to the individual partners27
. The MACN provides a good example of a B2B-Partnership,
since solving the problems around facilitation payments requires a joint effort within the sector. B2B-
Partnerships could also be desirable, if your CSR activity requires you to collaborate with other sectors
than your own.
There are many motives underlying the decision to
engage in B2B- Partnerships, including the
opportunity to gain access to new markets, sharing
marketing- or manufacturing costs, and enhancing
skills. Such partnerships can be between businesses
within the same industry, as well as with other
industries. B2B- Partnerships may also turn into a
network of partners forming strategic alliances around
a common topic of interest, whereby common
industry standards can be developed while members
are enabled to collectively tackle pressing issues.
Most B2B-Partnerships are established through contracts and relate primarily to commercial interests of
the parties. This material relates to B2B-Partnerships that specifically seek to address challenges or reap
benefits in relation to sustainable social, environmental, and economic development.
Under all circumstances B2B-Partnerships need to be extra careful if the partnership is established
between businesses from the same sector. Anti-competition or anti-trust laws are well developed in most
jurisdictions and place a heightened burden of proof on businesses that they are not fixing prices or
establishing illegal cartels, when meeting. This concern needs to be attended to when establishing
projects, possibly in collaboration with the anti-trust authorities.´´
Global Public-Private Partnerships
The term Global Public-Private Partnerships (GPPPs) is
used to indicate transnational, collaborative relationships
between private companies and intergovernmental
organisations – such as UN agencies, development banks
or EU institutions28
. GPPPs cover a relatively new form of
governance and seek to move away from hierarchical
relationships to more horizontal and participatory
arrangements between organisations, companies,
research entities and others.
26
Varadarajan & Cunningham, 1995
27
ibid
28
Buse, K. and Walt, G. 2000
Box 13: A Network Example
Maritime Anti-Corruption Network (MACN) is a
good example of an industry network where
resources and experiences are shared in order
to increase leverage and address a common
problem in the shipping industry; namely
business ethics.
Box 14: UN as a potential partner in MACN
 During the past two decades, collaboration
between different UN bodies and business
leaders has resulted in progress within anti-
corruption (Global Compact Office, 2011)
 Drawing on its vast experiences, the UN
could be a strong partner for the Danish
shipping industry in the work on corruption

30
GPPPs can be characterised as governance mechanisms, which are established by a number of different
partners, ranging from multi- and bilateral agencies to NGOs, private businesses and foundations. It is an
alliance made to achieve a common practical objective through the pooling of competencies, while
sharing risks, responsibilities, costs and resources.
One of the incentives for the corporate sector to engage in GPPPs may be the prospective for individual
businesses to improve their corporate image29
.
Another may be the ability to influence international legal standards30
. Engaging in this type of
partnerships also enables the incorporation of broader scopes in CSR activities. E.g. establishing
partnership projects with the EU or UN enable implementation of bigger scope than when working with
e.g. NPOs.
One of the most commonly faced challenges in GPPPs is to overcome differences in organisational
cultures. Multilateral organisations, such as the UN, often have a much longer time horizon than that of
corporate entities.
Therefore, it is crucial that expectations are aligned and a clear plan for the partnership is made from the
beginning. In addition bureaucracy structures around multilateral institutions are often perceived as a
barrier in itself. Receiving an approval for a partnership may last many months and often corporations
operate on very tight deadlines. However, the establishment of the UN Global Compact has enabled more
smooth collaboration between business and the UN, and in general UN Agencies are becoming more
29
Utting & Zammit, 2009, Buse & Walt, 2000
30
ibid
Box 16: Partnerships with the United Nations
During the last couple of years the UN increasingly engages in partnerships with the private sector. The UN
explicitly encourages public- and multilateral entities to engage in partnerships, as partnerships are perceived
as essential to reach the Millennium Development Goals.
Box 17: The Clean Cargo Working Group - Developing standards for clean cargo
“The Clean Cargo Working Group is a global business-to-business initiative consisting of leading cargo carriers
and their customers. The objective of the working group is to improve environmental performance in marine
container transport through measurement, evaluation, and reporting. In collaboration the members of the
working group develop the practical tools for measuring, evaluating, and reporting the environmental impacts
of global goods transportation.
(The Clean Cargo Working Group 2012)
Box 15: UN as a potential partner in MACN
 During the past two decades, collaboration between different UN bodies and business leaders has resulted
in progress within anti-corruption (Global Compact Office, 2011)
 Drawing on its vast experiences, the UN could be a strong partner for the Danish shipping industry in the
work on corruption

31
accustomed to participating in partnerships with the private sector and thus establish fix procedures and
integrity measures, shortening the processes.
Fig.20 Illustrations of core considerations on types of partnerships
Level of engagement
When companies engage in partnerships, they have to consider their level of engagement. This decision
will depend on the goals, ambitions and available resources in the company.
The level of engagement can be viewed as a collaborative continuum. This continuum ranges from an
arm’s length31
relationship between the partners, in which the company plays a rather invisible role in the
actual implementation phase, to an intensive alliance where both partners take leadership of the
implementation. Arm’s length relationships are characterised by exchange of resources, while intensive
alliances are characterised by pooling of resources.
It is important to consider the level of engagement prior to engaging in a partnership. Different levels of
engagement entail different challenges and opportunities. These must be weighed against each other.
Partnerships can range from one-way information sharing, through two-way dialogue and collaboration.
The presented definitions of the different partnership models should be understood as a continuum. A
company’s engagement in a partnership can therefore be seen as a gradual process.´
Fig. 21 Illustration of the level of engagement in partnerships
31
Rondinelli & London, 2003
CORE CONSIDERATIONS ON TYPES OF PARTNERSHIPS
 Consider how your business and a potential partner can complement each other; take
advantage of each other’s strengths and minimise weaknesses
 Consider self-interests as well as advantages of attracting a certain partner
Transactional Partnership
• Philantropy
• Arm's Length Relation
• Passive
Transitional Partnership
• Reciprocal Exchange
• Interactive Collaboration
• Participative
Transformative Partnership
• Symbiotic Value
• Intensive Alliance
• Leadership

32
Fig.22 Illustration of the characteristics of the different levels of engagement
The figures emphasise that the level of engagement is closely linked to objectives, activities and benefits
of the different partnership models.
Transactional Engagement – providing sponsorships or charity
The reason for engaging in transactional activities32
is normally grounded in the idea of giving back to
the community, e.g. through philanthropic contributions. A transactional engagement is a discrete effort,
typically providing donations of time, financial resources or skills. In other words, transactional activities
typically consist of transfers of resources from the corporation into operational activities of another
entity. This level of engagement can be considered as a sponsorship or as charity rather than a
partnership, since the company may support the realisation of different projects. Most communication is
one-way communication from a company to a partner e.g. in terms of information sessions. These
activities will only occur occasionally and the corporate partner has a high level of control over the
process. On the other hand, the receiving partner has full responsibility for implementation activities. As
such, a transactional level of engagement is not based on a long term approach. This makes engagement
easy and leaves a great level of flexibility. The engagement can be used as a means to improve brand
value, increase employee morale and enhance legitimacy.
32
Brown et. Al., 2010
Transactional Transitional Transformative
Aligned to core
business
Not aligned with the
core business
Closely aligned with
the existing core
business
Enlarging the core
business or
development of new
business
The objective Extra activities Improving
environmental or
social performance of
existing business
operations
New products and
services
Expected benefit Improvement of image
and reputational
impacts
Improvement of
environmental and
social aspects of core
business
Alleviation of social,
environmental or
economic problems
• Philantropy
• Passive
• Participative
• Symbiotic Value
• Leadership

33
In itself the transactional engagement is not considered as a
CSR partnership; firstly because the corporate partner is not
willing to share risks and opportunities33
, secondly, because
the supported activities are addressing sustainability issues
without direct involvement of business interests. In other
words, activities linked to transactional engagement
typically takes place outside the corporations own core
business. There are no direct change to core business
operations, which would improve sustainability of the
business and no long-term strategic business benefits
created through this engagement. A partnership would take
the interests of all partners into account. Although, the
transactional engagement may serve as a starting point for
establishing contact across sector boundaries, these are still
preliminary steps in forming a genuine partnership.
Despite the simplicity of transactional engagement, important challenges may arise from this approach.
The short-term horizon risks are addressing problems only at the surface without considering root
causes; i.e. the intervention risks not being sustainable. Arbitrary community engagement and donation
activities are, by many CSR practitioners, considered insufficient in addressing CSR. The challenges of
changing the business model to continuously contribute to, while not becoming a barrier for, sustainable
social, environmental and economic sustainability is not addressed by such activities.
CORE CONSIDERATIONS ON TRANSACTIONAL LEVEL OF ENGAGEMENT
 Consider how activities can be linked to your core business
 Consider how the transactional level of engagement can become a starting point for engaging
in collaborative partnerships
 Consider the strategic value of supporting different stakeholders
 Consider if you want to join a consortium or if you want to establish a direct relation to a
stakeholder
Fig.23 Illustration of core considerations on transactional level of engagement
33
Kjær, 2003
TRANACTIONAL LEVEL OF ENGAGEMENT- DO’S AND DON’TS
DO’S
 Establish clearly outlined donation processes
 Engage in transactional engagement if you wish to have a high level of control over the process
without active participation
 Engage in transactional engagement if your objective is to improve brand value and employee
morale as well as to enhance legitimacy of the business – but with little responsibility and risk
involved
Box 18: Example of transactional
engagement
After the tsunami 2004 Citigroup
provided office space in Bangkok for the
UN operations coordination. The French
food corporation Danone donated
packages of high-protein biscuits, water
and milk drinks through its local
distributors and through UN’s World Food
programme (Harvard Business review,
2006).

34
• Philantropy
• Passive
• Participative
• Symbiotic Value
• Leadership
Fig.24 Illustrations on do’s and don’ts in regard to transactional level of engagement
Transitional partnerships – integration of CSR activities into core business
A transitional level of engagement is driven by the idea of building bridges between different partners34
.
Contrary to the transactional engagement transitional partnerships aim at integrating responsibility and
sustainability aspects into the core business. The focus of these partnerships is on carrying out existing
business operations more responsibly and sustainably35
.
The emphasis in such partnerships may evolve around
ensuring high product quality, Responsible Supply Chain
Management (RSCM) – e.g. preventing child labour, health
and safety at the workplace, diversity etc. A good example
on transitional partnerships within the Danish Shipping
Industry is the development of a shared toolkit for RSCM
based on the UNGPs by five Danish shipping companies as
part of the project “On Course for a Better World. Another
example is the establishment of a working group aiming to
develop a common Code of Conduct on RCSM for the
relations on dry-docks.
Consequently, CSR considerations are incorporated into the
operations of the corporation both internally and externally in its relations. This level of engagement
requires corporations to be more involved in the process than in transactional engagement. Transitional
engagement can lead to joint learning and increase understanding between partners. Typically, these
partnerships draw on partner dialogues and consultations to facilitate joint learning.
Transitional partnerships revolve around stakeholder dialogues where public, private and third parties
discuss and develop e.g. private sector regulations36
. An output could be to develop common guidelines
34
Brown et.al 2010
35
Kourula & Halme, 2008
36
DON’TS
 Do not expect to generate new business solutions
 Do not expect to get involved in long term projects
Box 19: UN Global Compact – A
transitional Partnership
 The UN Global Compact aims at
mainstreaming the principles in
business activities around the world in
order for companies to act
responsible.
 A multi-stakeholder forum of
governance and corporation.
 The partnership builds on dialogue
and best practices.

35
for environmental and social issues. Focus is on improving social, environmental and economic
sustainability aspects of the core business. As a result, engagement in transitional partnerships will
require repeated interaction and accordingly, the responsibility of controlling the partnership is more
equally shared between partners. The transitional partnership is worth considering if the aim is to
improve legitimacy, improve risk management and attract talent.
TRANSITIONAL LEVEL OF ENGAGEMENT – CORE CONSIDERATIONS
 Consider how to make use of joint learning and understanding
 Consider how to involve stakeholders
Fig.25 Illustration of core considerations on transitional level of engagement
Fig.26 Illustration of do’s and don’ts in regard to transitional level of engagement
Transformative partnerships – generation of innovative solutions
Contrary to the transitional and transactional levels of engagement, the driver of transformative to
develop new business models to alleviate societal, environmental and economic issues37
or enhance
sustainability in these areas.
37
TRANSITIONAL LEVEL OF ENGAGEMENT – DO’S AND DON’TS
DO’S
 Engage if the objective is to improve legitimacy, manage risks and attract talents
 Engage if you aim to improve social or environmental issues based on existing business
operations
DON’TS
 Do not engage if you wish minimal involvement
 Do not engage if you are not willing to engage in stakeholder dialogues and consultations
• Philantropy
• Passive
• Participative
• Symbiotic Value
• Leadership

36
Does the partnership engage a team of
appropriate stakeholders?
?
Does the partnership include capacity to reach
scale and lasting impacts?
Thus, the objective of the partnership is to create win-win solutions for society and business. Hence,
transformative partnerships possess a large potential for value creation, as they can generate new
solutions and efforts that are hard to duplicate. In this way, the transformative approach can give
partners competitive advantages that cannot be achieved through transactional or transitional levels of
engagement. Here focus is on using CSR as a vehicle for innovation through partnerships, e.g. to develop
new products or services that aim to address a social and/or environmental problem.
This kind of engagement is distinct from transactional partnerships, since it provides the opportunity to
achieve outcomes that are unattainable without the engagement of all partners. The focus on innovation
requires a high level of involvement and frequent interaction between partners. Often partnerships build
on a transformative level of engagement seek to restructure ´the rules of the game´ for companies and
for the markets in which they operate, e.g. by developing new business models or through a wish to
change society38
.
The process is driven by co-ownership and established through trust-based relationships and mutual
understanding. Communication is characterised by two-way flows, and all partners are in control of the
partnership process. This approach is also characterised by the willingness of all parties to share risks as
well as skills, knowledge and resources. The synergies created through the partnership thus become
drivers of change.
With multiple partners engaging in transformative partnerships, decision-making processes and
management structures can become very complicated. Transformative partnerships therefore require
solid organisational efforts and are most likely to be successful when only a few partners are involved.
Transformative partnerships also appear to have greater potential for long-term positive business
outcomes than transactional partnerships. Further, in relation to social outcomes, the transformative
partnership appears to have a higher potential for generating local income-generating mechanisms and
supporting local self-sufficiency39
.
In order for individual companies to increase the value of their business activities, it can be beneficial to
move in the direction of a transformative approach to partnerships and engage with partners outside
their industry. Such re-organisation may create new working groups, which in turn could improve
operations or trigger product development. For some companies it may be easier to start partnership
engagement at the transactional or the transitional level and gradually move towards a transformative
level.
38
Brown, et.al., 2010
39

37
Box 20: Clean Cook Stoves – a transformative partnership
 The objective of the partnership: Poverty reduction and improved health from increased access to clean energy
and reduction of harmful indoor air pollution
 Systematic issue addressed: Respiratory diseases and high energy costs in household – resulting from the use of
polluting, inefficient cooking practices
 Necessary stakeholders involved: The UN Foundation, the World Health Organization, Shell, the Shell
Foundation, Morgan Stanley, Impact Carbon and other governments, implementing organizations and donors
necessary for the partnership.
 Core Competences leveraged: The UN Foundation used its convening and brokering capacity to convene partners
and raise funds for the effort. Shell is using its knowledge of energy markets assess the demand for clean cook
stoves in several developing countries. Morgan Stanley and Impact Carbon are exploring ways to subsidize the
cost of cook stoves through carbon credits generated by the reduction in pollution that results from their use
(UN Global Compact Lead, 2011:15).
 Capacity for scale and lasting impacts: Through a combination of information sharing, consumer marketing, and
financing mechanisms for affordability, the Alliance aims to create a self-sustaining market for 1000 million
clean cook stoves worldwide.
UN Global Compact Lead, 2011:15.
There are no watertight shutters between the different levels of engagement. A partnership might entail
elements of all. E.g. transactional level of engagement might form part of a transitional partnership. This
is best seen with Novozymes that donated money to WWF while at the same time collaborating on
developing a new framework for product life cycle analysis (transitional)40
. It is important to realise that
the main driver behind a business’s interaction will determine the type of engagement that is formed.
CORE CONSIDERATIONS ON TRANSFORMATIVE LEVEL OF ENGAGEMENT
 Consider if you appreciate co-ownership and if you are willing to share control over processes
and risks
 Consider if you are willing to allocate the required resources to partnership activities
 Consider if you have the support from top management
Fig.27 Illustration of the core considerations on transformative level of engagement
40
See http://novozymes.com/en/sustainability/stakeholder-engagement/ngo-engagement/Pages/default.aspx

38
Fig.28 Illustration of do’s and don’ts in regard to transformative level of engagement
TRANSFORMATIVE LEVEL OF ENGAGEMENT – DO’S AND DON’TS
DO’s
 Engage if the objective is to generate innovative solutions in relation to processes, products or
services
 Engage if the objective is to generate win-win solutions for business and society
 Utilise resources in order to trigger the innovative potential of partnerships
 Create an enabling environment for dialogue and two-way communication
DON’TS
 Do not get involved if you are not prepared to engage at a high level
 Do not expect of your partners to take on your management structures

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