The Payoffs to Partnerships

Working in partnership has been one of five drivers of change in ADB’s 2008 corporate strategy labelled Strategy 2020. Now that the organization has set its eyes on a new Strategy 2030, it is vital to find out what the experience has been in implementing partnerships thus far. That was the purpose of a new evaluation of ADB’s partnerships from Independent Evaluation.

The evaluation finds that partnerships grew in number and quality. ADB focuses on infrastructure, especially energy and transport, putting a relatively small amount of resources in others such as agriculture, education and health. By the same token, engaging in partnerships in these latter areas with more agencies has been a way to provide support and ensure those areas would get sufficient attention. The crucial questions addressed by the evaluation are not only about the size and quality of partnerships but also about their success in delivering on their objectives and to the extent possible also about their impact. We take these questions in turn below.

Have partnerships increased over the years? 

We found that, yes, the number of partnerships had more than doubled since 2009, after the Strategy had called for expansion. We counted an impressive 422 partnerships in all in 2015, 41% established before or in 2008 and 59% after. The number of knowledge partnerships after 2008 was two times higher than before; the rise was even more pronounced for coordination partnerships. ADB has become more connected to all sorts of agencies and networks, even at its remote location, the Philippines. A more difficult task was to expand the financing partnerships. Most of the financing partnerships were established before 2009, and grew by about 50%. Clearly, it was not as easy to get partners to spend more on projects with ADB as to produce and share knowledge together, or do more strategic coordination work– not surprising given that there has been a climate of austerity in many donor capitals since 2008.

How much has cofinancing increased over the years? 

Is it possible, all other things equal, to have a step change in the amount of cofinancing generated, such as ADB wanted in 2008? The tremendous rises reported by ADB since 2009 in cofinancing value generated (from 10% to over 50% of ADB’s own financing) are to a significant extent due to changing definitions of what counts as cofinancing. Most of it was in collaborative (lighter) cofinancings, not joint or contractual ones. Some developments affecting particularly cofinancing of private sector operations also led to a steep rise. The rise in ADB staffing by around 25% over the same period will have played a part in the growth. If we stick to the joint cofinancing, the increase was around 34% (as against a staff increase of 25% ), from 3.6% of all financing over 2000-2008, to 4.8% over 2009-2014. The conclusion is again that it is possible to increase but less easy to have a quantum leap in cofinancing and partnerships, without significant increases in staffing to do the legwork.

Does corporate targeting and scorecarding help cofinancing grow? 

We have concluded yes in the report but the previous point shows the limitations, and we do not expect cofinancing in real value added terms to get to 100% or more of ADB’s own financing. 50% achievement may be more realistic – especially considering that ADB’s own financing is also increasing dramatically. Nevertheless, targeting and scorecarding against progress surely raised the profile of cofinancing in IED, and led for some years also to special rewards for the department that raised its cofinancing most. The report concludes that it cofinancing target should be further subdivided in more precise and more realistic targets in some areas, otherwise the highly unattainable target runs the risk of becoming less inspiring but more off-putting.

Was ADB able to engage more in partnerships with others in less prioritized areas? 

Well, yes and no. ADB did better than expected in non-prioritized areas, in many ways. The corporate cofinancing target and the Strategy 2020 endorsement may indeed have helped. The cofinancing ratio in the noncore areas of agriculture, health and some others was 34% before 2009 and grew to 41% after. But an even higher proportion of cofinancing had been achieved in the areas in which ADB itself was putting most of its effort – in core areas such as transport and energy and water. The cofinancing ratio there went from a low 16% before 2009 to 54% after. Lesson: to really generate more cofinancing from partnerships with other development agencies, you need to also prioritize yourself in those areas.

Are cofinanced projects more successful? 

We checked success ratings of completed projects with and without cofinancing. Although ADB staff often find cofinancing tedious as it takes a lot of effort and it can delay project implementation and leads to higher reporting requirements, the surprising finding was that they are actually statistically significantly more successful. 81% of cofinanced projects were rated successful, compared to 67% of non-cofinanced projects. This may of course be explained by various reasons, some not to do with the act of cofinancing itself. Projects chosen by partners for cofinancing may have had already a higher profile and/or have been better designed from the start, so they engendered more interest from partners. But from the many interviews with the partners , we became convinced that there must be other reasons as well, directly linked to the cofinancing factor – the projects often get extra scrutiny because staff from the partner organization brings their own perspectives and provides suggestions for improvement to the design. In cases, staff of the partner organization joins missions during implementation bringing additional expertise, that helps improve the quality of supervision. Cofinancing may lead to the project taking about 10% more time to complete, but this investment pays itself back in the results being more often more successful.