The announcement that the UK’s Department for International Development (DFID) would be merged with the Foreign and Commonwealth Office (FCO) and a new department created was long expected, albeit with some trepidation, by many in the development community. Whilst it’s not yet clear what this change may mean, it does present a rare chance for fresh thinking about foreign policy, Britain’s position abroad, and how development can adapt to new and emerging challenges. Having initially been uncertain, I’m increasingly seeing this move as a natural step in the mainstreaming of development. Perhaps that’s not such a bad thing?

The clue is in the title

Palladium has been through this type of change more than once, including the integration of development and foreign affairs in Australia and in the Netherlands. Whilst many commentators have jumped to the conclusion that creation of the Foreign, Commonwealth and Development Office (FCDO) is part of the same trend – of development agencies being subsumed within larger foreign affairs departments – I do not see it that way.

Buoyed by Government commitments to retain the 0.7% commitment to aid and the continued focus on poverty reduction, together with assurances that the advocacy, programming, procurement skills and scrutiny associated with DFID will translate into the new department, I cautiously see the creation of the FCDO as an opportunity to refresh how we tackle global challenges. As Steven Dercon and Ranil Dissanayake suggested, “merging two departments does not create a “hybrid” department or a “super” department; it simply creates a new department.” In Australia, Canada, and the Netherlands, development became an element of foreign policy and was removed from the mast head; in the UK, initial signs – including the title – suggest that development will be at the heart of the new department. And herein lies the opportunity!

Today’s global problems require new solutions

Development has had amazing successes and has lifted many people out of poverty. But we have been unable to tackle some of the really sticky problems that beset the globe – persistent poverty in Malawi and insecurity in the Democratic Republic of the Congo are just two often cited examples. On top of these, we need to adapt fast to tackle increasingly globalised development challenges – food insecurity, infectious diseases, migration, modern slavery, and cross border conflict – that affect all of us. It’s essential that we rethink models on issues where progress hasn’t been made, at the same time as we accelerate progress on the most pressing development goals, including climate change, COVID-19, and the associated economic shocks.

As a sector that prides itself on innovation, we should rise to the challenge that this new department offers. How do we integrate different skills sets, better use our global influence, and really demonstrate to the British public that development – in tackling poverty along with the big global problems – is not just morally the right thing, but is also in all of our shared interests?

New solutions require new players

An integrated approach to development and foreign policy is not without challenge – notably, confusing the altruistic intent of development with a potentially more self-interested foreign policy. But over the last few years, we’ve seen a steady move away from development being the sole monopoly of donors. In some ways, development is increasingly being mainstreamed. We can now see development outcomes in the actions of partner governments, businesses, private organisations, banks, finance institutions, investors, and philanthropists. Let me give just two examples:

• We’re seeing private corporations thinking and acting in new ways about their supply chains, sustainability, and their impact on the world. They’re realising that not only is working with the communities behind their supply chains the right thing to do, it’s necessary to ensure their sustainability as a business. Customers, too, are looking for businesses with a story and an impact. Development narratives are now integral to many businesses, as our recent special report on Inclusive Growth illustrates.
  
  
• We’re seeing finance institutions and commercial banks engage in development and finance with purpose. This is not simply confined to impact investing but extends into the heart of financial institutions. Mark Carney, former Governor of the Bank of England was recently interviewed on monetary policy in the wake of the coronavirus pandemic. But, interestingly, most of his interview centred on the role of finance in tackling global climate change and supporting the UK Government’s own commitment to net zero. A decade ago, this would have been unthinkable.

The integration of DFID into the FCDO is in some ways an extension of this trend. Rather than a specialism working in isolation, development is now being positioned at the heart of foreign policy and business thinking and objectives. For me, this is much needed – not least because of the need for additional sources of funding and partnership. The money required to meet the UN’s Sustainable Development Goals (SDGs) is USD 2.5 trillion for the next 15 years. Traditional donor nations simply can’t meet this goal alone. We need leadership and investment from the state, the private sector and civil society working together. In my view, the principles within SDG Goal 17 (“Partnerships for the Goals”) will be critical if we are to realise the levels of investment and transformations required and in the timescales we need.

This change is coming

As a company, Palladium has always set out to create a positive change in people’s lives. We have made a transition in our business from donor-focussed to donor-enabled. We’ve set out a clear intent to work with other committed, long term actors to make the world a better place. The FCDO is coming, and it’s incumbent upon us to maximise all opportunities this change presents. With a looming economic recession and associated drops in donor funding flows, mainstreaming development and maximising partnerships with other organisations is more important than ever.

Sinead Magill is Palladium Managing Partner for EMEA. She has over 15 years' experience leading governance, security and justice programs, and played a key role in the DFID programming in Iraq, Afghanistan, Palestine, Uganda, and Syria. Sinead was featured in Management Today's 35 Under 35 and won the Women of the Future Business Award. 

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